Freddie Mac Extends Hurricane Foreclosure Moratorium Through May 31, 2006 In 21 Gulf Coast Counties

February 16, 2006

"One-Size Fits All" Policy Adjusted to Reflect Local Levels of Damage

McLean, VA – Freddie Mac announced it is extending its foreclosure suspension until May 31, 2006 in 21 counties and parishes in Alabama, Louisiana, Mississippi and Texas that suffered the most severe damage due to 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. The announcement was made in a February 10 Guide Bulletin sent to Freddie Mac's Seller/Servicers.

"We are replacing our one-size-fits all approach with a zone approach," explained Janet Eakes, senior vice president of Freddie Mac's operations division. "Our servicers have done an outstanding job helping borrowers with Freddie Mac owned loans in the immediate aftermath of the storms. Today's announcement builds on our commitment and on our servicers' commitment to continue to provide relief to borrowers in the worst disaster areas while resuming normal business operations elsewhere."

According to the February 10 Guide Bulletin, the zone approach divides the 119 Gulf Coast counties covered by last year's foreclosure moratorium into three separate zones and applies appropriate policies to each. Specifically,

  • 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;
  • Freddie Mac is requiring servicers to obtain Freddie Mac's prior approval before initiating a foreclosure in Zone 2, which includes 34 counties and parishes with less severe damage;
  • Freddie Mac is lifting its blanket foreclosure moratorium in Zone 1, the remaining 64 counties where there was no or minimal storm damage.
reddie 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 mortgage relief options are described in the "Owning and Keeping a Home" section on

The February 10 Guide Bulletin instructs servicers to help borrowers strengthen their credit reputations by reporting timely mortgage payments to credit reporting agencies as they bring their mortgages current. Until then, the bulletin reminds servicers not to report storm-related forbearances or bankruptcies to credit bureaus and to waive prepayment premiums for storm victims in some cases.

For more information, lenders can contact their Freddie Mac Account Representative or review the February 10 Guide Bulletin at

Freddie Mac Zone Designations by County/Parish

State Zone One Zone Two Zone Three
AL Greene, Hale, Pickens, Sumter, Tuscaloosa Choctaw, Marengo Baldwin, Clarke, Mobile, Washington
LA Allen, East Baton Rouge, East Feliciana, Evangeline, Iberville, Lafayette, Livingston, Pointe Coupee, Sabine, St. Landry, Vernon, West Baton Rouge, West Feliciana. Ascension, Assumption, Acadia, Beauregard, Iberia, Jefferson Davis, Lafourche, St. Charles, St. Helena, St. James, St. John The Baptist, St. Martin, St. Mary, Tangipahoa, Terrebonne, Vermilion, Washington Calcasieu, Cameron, Jefferson, Orleans, Plaquemines, St. Bernard, St. Tammany
MS Adams, Amite, Attala, Choctaw, Claiborne, Copiah, Covington, Franklin, Hinds, Holmes, Humphreys, Jefferson, Jefferson Davis, Kemper, Lauderdale, Lawrence, Leake, Lincoln, Lowndes, Madison, Neshoba, Newton, Noxubee, Oktibbeha, Pike, Rankin, Scott, Simpson, Smith, Warren, Winston, Wilkinson, Yazoo Clarke, Greene, Forrest, Jasper, Jones, Lamar, Marion, Perry, Walthall, Wayne George, Hancock, Harrison, Jackson, Pearl River, Stone
TX Angelina, Fort Bend, Brazoria, Galveston, Harris, Montgomery, Nacogdoches, Polk, San Jacinto, Shelby, Trinity, Tyler, Walker Chambers, Hardin, Liberty, Sabine, San Augustine Jasper, Jefferson, Newton Orange

Source: Freddie Mac

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