Fannie Mae, Freddie Mac To Extend Multifamily Forbearance Through March 31
The Federal Housing Finance Agency announced yesterday Fannie Mae and Freddie Mac will continue to offer COVID-19 forbearance to qualifying multifamily property owners through March 31, 2021. The programs had been set to expire December 31.
“Due to the continued presence of COVID-19 in our communities and its disproportionate impact on renters, FHFA will extend forbearance multifamily offerings and tenant protections beyond the end of the year and through the first quarter of 2021,” said FHFA Director Mark Calabria.
Property owners with enterprise-backed multifamily mortgages can enter a new or, if qualified, modified forbearance if they experience a financial hardship due to the COVID-19 emergency. Multifamily property owners who enter into a new or modified forbearance agreement must:
–Inform tenants in writing about tenant protections available during the property owner’s forbearance and repayment periods, and
–Agree not to evict tenants solely for the nonpayment of rent while the property is in forbearance.
FHFA said additional tenant protections apply during the repayment periods. These protections include:
–Giving tenants at least a 30-day notice to vacate,
–Not charging tenants late fees or penalties for nonpayment of rent, and
–Allowing tenant flexibility in the repayment of back rent over time; not necessarily in a lump sum.
In addition to requiring written tenant notification, the Enterprises have posted the tenant protections to their respective online multifamily property lookup tool websites. The property lookup tools make it easy for tenants to find out if the multifamily property in which they reside has an Enterprise-backed mortgage.
As a secondary mortgage market participant, Freddie Mac does not have a direct relationship with multifamily borrowers or renters, but it has established several tools to aid borrowers and renters throughout the pandemic, including a loan lookup tool so renters can see whether their multifamily property has a loan purchased or securitized by Freddie Mac. The GSE also established a hotline staffed by HUD-certified counselors for renters facing financial distress as a result of the pandemic. Those resources are available at http://myhome.freddiemac.com.
“Our forbearance program is just one way that Freddie Mac Multifamily has worked to support multifamily operators and renters throughout COVID-19, and we will continue doing what we can to provide for stability, liquidity and affordability,” said Freddie Mac Head of Multifamily Debby Jenkins.
Michele Evans, Executive Vice President and Head of Multifamily with Fannie Mae, said the forbearance extension will safeguard renters by suspending all evictions for nonpayment of rent and allow for flexible repayments, “which will help keep people in their apartments.”
Fannie Mae hosts a Renters Resource Finder to help renters facing financial hardship due to COVID-19 understand their options.
FHFA said it will monitor coronavirus’ impact on tenants, borrowers and the mortgage market and update policies as needed.