The Federal National Mortgage Association Deals with natural disasters and their effect on mortgaged properties and their owners. For guidance on special circumstances related to servicing loans in areas affected by natural disasters, servicers may contact Fannie Mae’s Single-Family Servicing Servicer Support Center Where to Find Selling Guide Requirements for Disaster Relief. In that section they describe all the various disaster related financial products like home equity loans for repairs, mortgage protection, etc. they provide grants and loans to homeowners with property and livelihoods negatively impacted by natural disasters.
Details of Fannie Mae’s Function as Support for the Homeowners in Natural Disasters
Fannie Mae (FNMA/OTC) is reminding those affected by the floods in the Harvey affected parts of the country of the options available for mortgage assistance. Under Fannie Mae’s guidelines for single-family mortgages, servicers have the ability to grant an initial period of forbearance to any borrower they believe has been affected by this natural disaster. Additional forbearance is available with approval from Fannie Mae. In addition, Fannie Mae guidelines authorize servicers to delay foreclosure sales and other legal proceedings in these areas. In addition, borrowers may use lump-sum disaster-relief grants or loans to satisfy Fannie Mae’s minimum borrower contribution requirement.
Other Functions of Fannie Mae
There is certainly not room here to discuss Fannie Mae’s role in the macroeconomic real estate market in the United States. Suffice it to say that Fannie Mae is a purchaser of mortgages; loans from approved mortgage sellers and securitizes them; it then sells the resultant mortgage-backed security to investors in the secondary mortgage market, By purchasing the mortgages, Fannie Mae and Freddie Mac provide banks and other financial institutions with fresh money to make new loans. This gives the United States housing and credit markets flexibility and liquidity. They also serve as a watchdog for mortgage fraud and disseminate standardized software to create uniform banking practices.