National mortgage company Freddie Mac announced it is extending its suspension of foreclosures until May 31 in 21 parishes and counties in Louisiana, Mississippi, Alabama and Texas that suffered the most severe damage from hurricanes Katrina and Rita. At the same time, Freddie Mac said it would lift the moratorium on foreclosures in areas that experienced the least damage.

Freddie Mac is one of two home-lending giants created by Congress to pump money into the home mortgage market. They buy home loans from banks and other lenders and bundle them into securities for sale on Wall Street.

Freddie Mac has taken a “zone approach” in determining when the suspension of home loan foreclosures will expire. It divided the 119 Gulf Coast parishes and counties in Louisiana, Mississippi, Alabama and Texas covered by last year’s foreclosure moratorium into three zones and applies foreclosure policies to each zone.

n Freddie Mac is extending its foreclosure moratorium through May 31 in Zone 3, which includes the 21 counties and parishes in federally designated disaster areas where Federal Emergency Management Agency individual assistance is available.

This zone includes Calcasieu, Cameron, Jefferson, Orleans, Plaquemines, St. Bernard and St. Tammany parishes, along with Hancock and Pearl River counties in Mississippi.

n Freddie Mac is requiring home loan servicers to obtain Freddie Mac approval before initiating a foreclosure in Zone 2, which includes 34 counties and parishes with less severe damage.

These include Ascension, Assumption, Acadia, Beauregard, Iberia, Jefferson Davis, Lafourche, St. Charles, St. Helena, St. John the Baptist, St. Martin, Tangipahoa, Terrebonne, Vermilion and Washington parishes.

n Freddie Mac is lifting its blanket foreclosure moratorium in Zone 1, the remaining 64 parishes or counties where there was no or minimal storm damage.

This includes Allen, East Baton Rouge, East Feliciana, Evangeline, Iberville, Lafayette, Livingston, Pointe Coupee, Sabine, St. Landry, Vernon, West Baton Rouge and West Feliciana parishes, along with Adams, Amite and Pike counties in Mississippi.

Freddie Mac, however, is strongly encouraging servicers to extend mortgage relief to borrowers with Freddie Mac loans on a case-by-case basis regardless of zone. Freddie Mac authorizes servicers to provide a wide range of mortgage relief to storm victims, including forbearance for up to one year from the date of the disaster.

Freddie Mac’s mortgage relief options are described in the “Owning and Keeping a Home” section on http://freddiemac.com.

For more information, lenders can contact their Freddie Mac Account Representative or review a Feb. 10 Guide Bulletin at http://www.freddiemac.com/sell/guide/bulletins.

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