Freddie Mac Extends Help to Borrowers Affected By Hurricane Isaac

Freddie Mac announced that it will offer disaster relief policies for homeowners whose homes were damaged by Hurricane Isaac.

In the aftermath of the hurricane, President Barack Obama declared Louisiana and Mississippi as major disaster areas. Many borrowers in these areas might be unable to make on-time mortgage payments and Freddie Mac’s policies are designed to help those in distress.

Freddie Mac has asked mortgage service providers to assist and help borrowers by suspending foreclosure and eviction proceedings for up to 12 months; waiving assessments of penalties or late fees against borrowers with disaster-damaged homes; and not reporting forbearance or delinquencies caused by the disaster to the nation's credit bureaus, Freddie Mac said in a statement.

"Freddie Mac has authorized the nation's mortgage servicers to provide a full range of mortgage relief options to affected borrowers with mortgages owned or guaranteed by Freddie Mac," Tracy Mooney, Senior Vice President of Single-Family Servicing and Real Estate Owned at Freddie Mac said in a statement. "Forbearance on mortgage payments for up to one year is one of several options our servicers have been instructed to offer borrowers on a case-by-case basis."

Meanwhile, officials are still gauging the extent of damage caused by the hurricane. In Louisiana, at least at least 13,000 homes were damaged, Christina Stephens, a spokeswoman for the Louisiana Office of Homeland Security and Emergency Preparedness, told BBC.

Though floodwaters are receding, many have been forced out of their homes and close to 1,500 evacuees were still in shelters, BBC reported.

But the construction work that is set to follow will boost the ailing economy, believe economists, who predict the loss to be several millions of dollars, the Greater New Orleans reported.