Freddie Mac HAMP Comments 11/6/09 From Quarterly Report

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Freddie Mac HAMP Comments 11/6/09 From Quarterly Report

MCLEAN, Va., Nov. 6 /PRNewswire-FirstCall/ --

Making Home Affordable was the company’s number one focus and the centerpiece of its foreclosure-prevention efforts. During the quarter, Freddie Mac continued to enhance its infrastructure and capacity to support the MHA program, and saw significantly increased activity in both of its key programs - HAMP and the Freddie Mac Relief Refinance Mortgage(SM), which is Freddie Mac’s implementation of the Home Affordable Refinance program.

The completion rate for HAMP loans, which is the percentage of loans that successfully exit the trial period due to the borrowers fulfilling the requirements for the modification, remains uncertain due to the number of new requirements of this program and the ability to obtain updated information from borrowers.

Freddie Mac has launched several initiatives to modify more loans under HAMP and to drive an increase in the number of successful trial period completions. As part of these efforts, Freddie Mac has:

* Engaged a vendor to help ease backlogs at several servicers by processing requests for HAMP modifications by providing them with document collection and signature services;
* Launched a program to complete more HAMP modifications by retaining a vendor who will visit eligible borrowers at their homes to help them complete the required trial period documents; and
* Implemented a second-look program to review whether borrowers are being properly considered for HAMP by servicers. Borrowers who do not qualify for HAMP are then considered under the company’s other foreclosure prevention programs.

Freddie Mac continued the purchase of refinance mortgages originated under the Freddie Mac Relief Refinance Mortgage(SM) during the quarter. The company helped refinance approximately 98,000 loans totaling $20 billion of unpaid principal balance as of September 30, 2009 under this program. Freddie Mac expects that the recent enhancements to the Freddie Mac Relief Refinance Mortgage(SM), which provide for the increase in the maximum allowable loan-to-value ratio up to 125 percent and the ability to refinance through any servicer and which became effective on October 1, 2009, will enable more borrowers to take advantage of the program in the coming quarters. As of September 30, 2009, Freddie Mac had refinanced over $300 billion in home loans during the year, creating an estimated $3.8 billion in aggregate annual interest savings for 1.5 million borrowers.

Full report at Freddie Mac Releases Third Quarter 2009 Financial Results
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