Freddie Mac (FRE) said on Thursday that it has ordered the suspension of all evictions involving occupied single family and 2-4 unit properties that have been foreclosed and had Freddie Mac-owned mortgages for about two weeks during the holiday season.
The period of suspension will be from Dec 19, 2009 to Jan 3, 2010. Freddie did not estimate how many homeowners would get this grace period.
Concurrently, another mortgage finance company Fannie Mae (FNM) is also suspending foreclosures and evictions for about two weeks.
Earlier on the same day, Citigroup Inc. (C) also announced a 30-day suspension of foreclosures and evictions, affecting about 4,000 borrowers.
Freddie Mac’s third quarter net loss came in at $1.94 per share, compared to a net loss of 11 cents in the prior quarter and $19.44 in the prior-year quarter.
Though the results improved significantly over the prior-year quarter, the company expects its provision for credit losses to remain high during the fourth quarter of 2009.
Freddie Mac has been among the firms hardest hit by the housing slump, credit crisis and ongoing recession. We anticipate losses to increase in the coming quarters and the conservatorship to continue for a long time, and thus see no value for the common shareholders.
However, we do foresee its increased participation in the Making Home Affordable Program potentially bringing down losses from foreclosures in the upcoming quarters. The company is also trying to improve the profitability of its guarantee business by tightening its credit standard.
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