Citi and Fannie Suspend Foreclosures, Payments in Oil Stricken Gulf

June 16, 2010 No Comments »

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Both Citi and Fannie Mae announced separate foreclosure moratoriums today for homeowners affected by the BP oil spill.

Citi said it would suspend foreclosure notifications and sales on CitiMortgage-owned first mortgages in coastal regions of the Gulf of Mexico “hard-hit by the oil spill” for three months.

The suspension is effective from June 17 until September 17, and applies to CitiMortgage borrowers who occupy homes in zip codes within approximately 25 miles of affected coastal areas.

Additionally, evictions on real estate owned properties (REO) will cease during the moratorium.

Fannie Mae also said today that servicers may immediately suspend or reduce mortgage payments for those negatively impacted by the Gulf oil spill.

Under Fannie’s “Special Relief Measures” policy, loan servicers may suspend or reduce a borrower’s payments for up to 90 days while they determine what impact the disaster is having on the condition of the property and the borrower’s finances.

“At the conclusion of that assessment, servicers have additional flexibilities to evaluate the appropriate loss mitigation alternative based on a case-by-case determination, including an additional three months of forbearance, a loan modification or other customized solution,” Fannie Mae said in a release.

I’m assuming Freddie Mac and others will get on board as well, but only time will tell.

If you live in an affected area and need assistance, contact your loan servicer as soon as possible.

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