Freddie Mac today announced it is temporarily relaxing some of its guidelines in an effort to cut the time it takes the nation's mortgage servicers to get insurance money into the hands of borrowers who have suffered property damage in locations declared MajorDisaster Areas because of hurricanes Charley or Frances or Tropical Storm Bonnie. Getting funds into borrowers' hands more quickly will help them
compete more effectively for contractors, building materials, and other scarce
resources. Under the new temporary guidelines, mortgage servicers can immediately release insurance funds made payable jointly to an insured borrower and the servicer. The amount can equal the highest of:

* $20,000;
* One-third of the amount of the insurance draft;
* 10 percent of the affected mortgage's unpaid balance;
* The amount by which the released funds exceed the unpaid balance of
the mortgage.

To advance funds using these temporary guidelines, a mortgage must be
current and a borrower's payment history must not indicate delinquencies of
two payments or more.
"Temporarily relaxing these insurance loss requirements is absolutely the
right thing to do," said Freddie Mac Senior Vice President Mike May. "This is
a critical policy change that we believe will not only help families recover
more quickly from this year's disastrous wave of hurricanes, but will also
help our Servicers to better cope with the extraordinary demands these storms
are placing on their resources."
In addition, Freddie Mac is continuing to urge servicers to provide
borrowers affected by hurricanes Charley or Frances with relief through the
company's disaster relief guidelines. Under these guidelines, impacted
borrowers whose mortgages are owned by Freddie Mac may qualify to have their
mortgage payments reduced or suspended for up to 12 months. Each case will be
individually assessed to determine which relief alternative will best fit the
homeowner's circumstances.
Freddie Mac is also strongly encouraging mortgage servicers to waive the
assessment of penalties or late fees against borrowers with disaster-damaged
homes and not report forbearance or delinquencies caused by the disaster to
the nation's credit bureaus.
For more information on mortgage payment relief, homeowners should contact
their mortgage servicer -- the company to which they send their monthly
mortgage payment -- or call Freddie Mac at (800) FREDDIE.

Freddie Mac is a stockholder-owned corporation chartered by Congress in
1970 to create a continuous flow of funds to mortgage lenders in support of
homeownership and rental housing. Freddie Mac purchases mortgages from
lenders and packages them into securities that are sold to investors. Over
the years, Freddie Mac has made home possible for one in six homebuyers and
more than two million renters across America.

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