Fannie-Freddie Not Buying Problem Loans Has U.S. Seeking Fix
- Mortgage giants aren’t purchasing new loans in forbearance
- Resistance a problem as borrowers miss payments due to virus
Photographer: Daniel Acker/Bloomberg
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Fannie Mae and Freddie Mac’s regulator is confronting a fresh crisis for the U.S. housing market: The companies won’t buy recently issued loans that were made to borrowers who already can’t afford their monthly payments because of coronavirus.
Industry executives have told the Federal Housing Finance Agency, that the issue is causing severe disruptions for the real estate sector because it’s keeping the mortgage giants from guaranteeing new loans in forbearance. In response, FHFA may announce an update to Fannie and Freddie’s policies aimed at easing the problem as soon as this week, said people familiar with the matter who requested anonymity because no changes have been publicly announced.