Fannie Mae and Freddie Mac announced this week that they’re going to stop evicting those in foreclosed homes until after the New Year. Many big banks have similar policies. Is this altruism or a publicity stunt?
It could be both.
Elonda Crockett of Fannie Mae says the government-sponsored mortgage giant wants to do the right thing.
“We want to give families who’ve had a hard time some relief at the holidays,” says Crockett, vice president for REO fulfillment at Fannie Mae. REO refers to repossessed homes.
Fannie Mae’s moratorium runs from December 19 to January 2. The foreclosure crisis is one reason Fannie Mae made this grace period a nationwide policy five years ago.
Big banks are also getting into the holiday spirit. Bank of America, Citigroup, and US Bank are among those taking a break from evictions. Wells Fargo has had this policy for decades.
“It’s a very traditional step for us to take. It’s not unusual,” says Vickee Adams, vice president for External Communications at Wells Fargo.
So, is this out of the goodness of their hearts or something else? It depends on who you ask. In the goodness camp: Pamela Banks of Consumers Union.
“I think they should be applauded,” Banks says. “This is a very humane, charitable thing to do.”
Then, there’s Ira Rheingold.
“Wow, that’s so great of them. I’m completely unimpressed,” says Rheingold, executive director of the National Association of Consumer Advocates.
His theory about the moratoria is that the Fannie Mae and the banks "simply don’t want to be on the local news at night putting a family out at the holidays.”
Mortgage lenders aren’t the only ones who don’t want to look like Scrooge. FirstEnergy, an electric utility with six million customers in six states, says it won’t turn off the lights for nonpayment during the last week of December.
“It’s just our way of doing something a little special during the holidays,” says FirstEnergy spokesman Mark Durbin.
If you’re looking for a grinch, try the repo man. The ones we called said they’ve been known to take property even on a holiday.