FHFA to Phase Out COVID-Related Loan Flexibilities By End of May
The Federal Housing Finance Agency said it would extend some temporary loan origination flexibilities for Fannie Mae and Freddie Mac through May 31—and that’s it.
All temporary flexibilities were originally set to expire on April 30. Alternative appraisals on purchase and rate-term refinance loans are among the flexibilities that will now be extended through May 31. Those temporary flexibilities related to employment verification, condominium project reviews and expanded power of attorney are being allowed to expire as scheduled on April 30.
FHFA said due to low usage of the temporary flexibilities, FHFA expects to retire all temporary selling flexibilities on May 31.
“Throughout the COVID-19 pandemic, FHFA has actively monitored the pandemic’s impact on mortgage market participants’ use of the temporary selling policies,” FHFA said in a statement. “Low usage of the flexibilities make the temporary flexibilities no longer mandatory to ensure efficient market function.”
More information is available at consumerfinance.gov/housing.