Freddie Mac is one of the many mortgage industry giants that have taken a proactive approach to handling the government shutdown, in regards to its effect on borrowers, servicers and sellers.
The company issued an update to its Guide Bulletin that provided temporary guidance for borrowers and sellers who faced a number of obstacles since the shutdown began on December 22, 2018.
"With the shutdown extending for a longer period than originally anticipated, we are concerned with the impact that continued income interruption may have on a Borrower’s ability to meet a mortgage payment and other monthly obligations," said the company in its latest Guide Bulletin.
"Therefore, we are adding a minimum reserves requirement, intended to offset the risk associated with the interruption of income as a result of the shutdown. In addition, we are providing further flexibility in circumstances when, as a result of the shutdown, the Seller is unable to meet the Freddie Mac requirements for a 10-day pre-closing verification of employment (10-day PCV)."
Naturally, once the government shutdown has ended, the temporary guidance and requirements will be terminated. The guide addresses interruption in pay, reserves requirements, verification of income and employment and government mortgages.
To view the full details of the Freddie Mac Guide Bulletin issued on January 16, click on the image above.