Fannie Unveils New Workout Option

Fannie Mae has announced the introduction of a mortgage workout option under which servicers can offer an unsecured personal loan to enable qualified borrowers to cure the payment default on a mortgage loan owned or securitized by Fannie Mae. The option, called HomeSaver Advance, "will help Fannie Mae streamline its loss mitigation efforts and offer loan servicers a new way to cope with a delinquent loan," said Mike Quinn, Fannie's senior vice president for single-family credit risk management. Fannie Mae said it expects the new option to reduce the number of delinquent mortgage loans it buys from its mortgage-backed securities trusts and decrease the fair-value losses it would record in connection with those purchases. Fannie Mae can be found on the Web at http://www.fanniemae.com.