What was this important question?
Can a borrower refinance or purchase a home after needing to use the forbearance program?
In March of this year the government initiated the forbearance program to allow people to postpone making their mortgage payments. The program did not address an important question regarding how to qualify borrowers with loans that are in or had been in forbearance. This week the FHFA, which regulates Fannie Mae and Freddie Mac, shed some light on this question. It announced that borrowers in the forbearance program and those who have left it may now refinance or purchase a home with a new mortgage. The main condition to qualify is that the borrower must have made at least the last three consecutive months of payments. Previously the guideline required the borrower to be current on their mortgage for at least a year, or have repaid the full amount of any payments missed.