Fannie, Freddie to Unveil Plan to Cut Mortgage Principle for Distressed Borrowers

Fannie Mae (OTC: FNMA) and Freddie Mac (OTC: FMCC) could soon release a plan to forgive some principle for borrowers who are underwater and delinquent on their mortgages, according to a report Wednesday afternoon from the Wall Street Journal. Details of the new plan could be released as soon as Thursday, the Journal said.

Borrowers would need to owe more than their homes are currently worth and already be at least 90 past due on payments to qualify for the new plan. The plan would also come with a threshold that, after the reduction in principle, borrowers would still owe 15% more than their homes are worth.

Link to WSJ story

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