Industry News

Katrina could impact up to 360,000 real estate loans

Mortgage bankers offer relief to hurricane victims

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The Mortgage Bankers Association estimates that up to 360,000 real estate loans could be directly or indirectly impacted by Hurricane Katrina and are valued at up to $48 billion. The mortgage banking trade group and its members encourage victims of Hurricane Katrina to directly contact the mortgage company that they regularly make mortgage loan payments to as soon as possible. While policies may differ from company to company, most mortgage bankers are offering extended grace periods and are postponing any foreclosure action, MBA said. This means that any borrower who lives within the ZIP codes published by FEMA as being federal disaster areas will not – during the lender's grace period – be charged late fees nor have late payments reported to credit agencies, which can negatively impact their credit scores. MBA and its members urge consumers to call their loan servicer to confirm the length of the grace period and to discuss additional or long-term solutions. In addi...