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Lenders halt Foreclosures for Holidays

Several major US lenders, as well as mortgage giants Fannie Mae and Freddie Mac, have pledged not to evict delinquent homeowners during the upcoming holiday season. Fannie and Freddie have each instituted a moratorium on foreclosures, active between December 19th and January 2nd. The agencies said that legal and administrative proceedings will continue during the moratorium, but families will be allowed to remain in their homes until after the holiday season.

In addition, JP Mortgage Chase and Wells Fargo's mortgage divisions have each said they will not evict delinquent homeowners between December 22nd and January 2nd, though preliminary foreclosure proceeding will continue as normal. Earlier in the year, Bank of America said it would "avoid foreclosure sales or displacement of homeowners or tenants around the Thanksgiving and Christmas holidays," though it did not offer a specific timeframe when it would cease home seizures like the other banks.

The promises made by major lenders do not, however, extend to loans the banks service that are actually owned by third parties. In those cases, the banks indicated, they will honor the wishes of the owners of the loans, meaning that foreclosures may occur during the holiday period. According to data from RealtyTrac, the moratoriums could affect tens of thousands of lenders, as there have been an average of 89,000 foreclosure auctions scheduled per month this year.

December 7, 2011