Hurricanes Katrina and Rita Information for Sellers and Servicers

(Revised as of March 31, 2009)

Since Hurricanes Katrina and Rita devastated the Gulf Coast in August and September 2005, we've been working closely with our Sellers and Servicers to provide ongoing assistance, relief and support to borrowers impacted by the storms.

We are proud and appreciative of the outstanding work that our Sellers and Servicers have done to help borrowers who were affected by Hurricanes Katrina and Rita. Together, we have demonstrated our mutual commitment to assist these borrowers, focusing our relief efforts on the most impacted areas, while gradually resuming normal business operations in step with the recovery progress.

To best apply Katrina-Rita specific policies to your Freddie Mac mortgages, you need to know:

• If a property securing a mortgage is located in an eligible Disaster Area, as described in our Guide Bulletins, and
• When originating mortgages in the eligible Disaster Areas, the current Zone number Freddie Mac has assigned to the county/parish in which the property is located. The three-zone methodology for mortgage servicing has been discontinued.

Our Current Temporary Requirements For Sellers

• The three-zone methodology, which assigns a zone number to each county/parish in eligible disaster areas.
• Mortgages secured by damaged properties located in Zone One
• Special Characteristics Code (SCC) 821 on Forms 11 and Forms 13SF, as applicable when selling mortgages affected by Hurricanes Katrina and Rita.

In addition, Home Possible® Mortgages with note dates on or after July 1, 2008, that are secured by properties located in eligible Disaster Areas affected by Hurricanes Katrina and Rita must comply with the median income limits described in Guide Section A34.7.

Our Current Temporary Requirements For Servicers

Servicers servicing mortgages secured by properties in the eligible Disaster Areas should continue to use:

• Temporary requirements for credit reporting and borrower-paid mortgage insurance cancellation remain in effect for eligible mortgages until no longer applicable.
• Servicers must follow our Guide requirements for managing distressed and abandoned properties (Sections 67.27 and 67.28) and for properties impacted by a disaster (Chapter 68).
• Servicers should continue to work with borrowers to provide appropriate assistance, including continued suspension or reduction of mortgage payments, to address the particular circumstances faced by each borrower.