CoronavirusMortgage

Fannie Mae lender letter expands its temporary policies

Announces one-month application extension

Fannie Mae sent out a lender letter Thursday announcing that it is extending the application deadline for it’s temporary policies until July 31, 2020.

“We are extending the temporary policies in this lender letter to loans with application dates on or before Jul. 31, 2020 from Jun. 30, 2020,” the company said in its letter. “Each applicable date has been updated in the remainder of this Lender Letter. All other effective dates remain unchanged.”

Previously, Fannie Mae had sent out a lender letter with additional requirements for borrowers who are self-employed. That letter announced that lenders would be required to obtain additional documentation to see if self-employment income meets Fannie Mae requirements.

“We are actively monitoring the spread of COVID-19 (coronavirus) in the United States and understand there are concerns about its potential impact on borrowers, businesses, and loan originations,” Fannie Mae said in its latest letter. “Our ability to continue to serve our customers is a top priority.”

So far, the U.S. has seen more than 2 million confirmed cases of COVID-19 and nearly 115,000 deaths. However, even as the virus continues to spread, states across the U.S. are increasingly beginning to reopen. Continuing jobless claims, measuring the total number of people receiving unemployment benefits, eased by 339,000 to 20.9 million, the latest Labor Department report showed. Nevertheless, jobless claims totaled 1.5 million over the last week as backlogged jobless claims are processed.

“The purpose of this lender letter is to address a number of questions and concerns that industry partners have raised to us,” it continued. “We are working closely with Freddie Mac under the guidance of FHFA to offer temporary measures to help ensure lenders have the clarity and flexibility to continue to lend in a prudent and responsible manner.”

To read the letter in full and see all the temporary policy changes Fannie Mae has enacted, click here.

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