[Moe Bedard]

FannieMae doesn't offer principle reductions as an option............this is why NACA has such a hard time submitting proposals to them..........

The roadblocks that NACA runs into with FannieMae........

Homeowner’s must be late – Fannie requires the homeowner to be four months late prior to restructuring (i.e. modifying) the mortgage thus requiring them to destroy their credit.

Limited Interest Rate reductions – They will only permanently reduce the interest rate to the market rate, refusing to go lower to make the mortgage payment affordable. This will result in the eventual foreclosure.

No Principal Reductions – Fannie will not reduce the principal, in virtually any circumstance, to make the mortgage payment affordable.

Short-term Solutions – The primary solution has been the HomeSaver Advance (“HSA”) that puts the unpaid arrearage into a second loan. This does nothing to address the underlying unaffordable mortgage. It is deceptive to have the loan appear current when the mortgage payments continue to be unaffordable.

Foreclosure Sales - Fannie requires full documentation to delay a foreclosure sale. This prevents the comprehensive counseling and long-term solutions that may have been possible.

Predatory Practices – Fannie continues to advocate interest only solutions. These IO plans do not provide for long-term affordable homeownership and in fact are equivalent to renting since no equity is created through making the mortgage payments.

NACA states.............
While we continue to get affordable solutions for many at-risk homeowners, we have encountered a serious roadblock due to the refusal of Fannie Mae to support long term affordable solutions