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1.5.4.2 Mortgage Forbearance

Fannie Mae has authorized a forbearance period of up to twelve months for borrowers affected by Hurricanes Harvey, Irma, and Maria.159 The servicer “must use its discretion to determine the appropriate duration of the forbearance plan based on the extent of damage to the property and/or the financial impact to the borrower” and must receive Fannie Mae’s approval before granting disaster relief that exceeds ninety days.160

For current loans, loans fewer than or equal to ninety days’ delinquent, or loans under a trial period plan, and when the borrower’s employment or income is seriously affected by a disaster event, the servicer is authorized to offer a forbearance plan. If the servicer is in touch with the borrower, (known as achieving “quality right party contact”) during the disaster relief period, the servicer is authorized to offer a forbearance plan term of up to six months. If the borrower is unable to provide a complete Borrower Response Package at the end of the initial six months of forbearance, the servicer may offer a successive forbearance up to six months in length, but not to exceed twelve months without obtaining a complete Borrower Response Package.161

If the servicer does not achieve quality right party contact during the disaster relief period, the servicer is authorized to offer a forbearance plan term of up to three months.

If the loan is more than ninety days’ delinquent, and quality right party contact has been achieved during the disaster relief period, the servicer is authorized to offer a forbearance plan term of up to six months.162 If the loan is more than ninety days’ delinquent, and quality right party contact has not been achieved during the disaster relief period, the servicer is authorized to offer a forbearance plan term of up to three months.163

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