Under the category of 'what took so long' two secondary market players announced a couple of small changes; one that may help financially squeezed troops the other that adds an extra layer of security to a small sector of the mortgage market.

Effective June 18, the Federal Housing Administration (FHA) will start validating Social Security numbers for consistency with borrower names and dates of birth in an attempt to reduce identity theft and fraud in its single family insurance program.


The validation, which will be free to lenders, requires the lender to enter the borrower's name, date of birth, and Social Security number into the FHA automated processing system. Only if the three numbers are found to match with reasonable confidence elements in other databases to which FHA has access will a case number be issued that will allow loan processing to continue.

This verification is available only for FHA loans but sure seems like a good idea for other lending programs.

On another front, Freddie Mac has revised its guidelines to require that each of its 2,300 servicers automatically extend a 90 day period of forbearance to borrowers recently released from active duty with the armed services.

Under this directive, servicers cannot initiate or resume foreclosures for at least 90 days from a borrower's military release date. This will give borrowers and lenders more time to work through problems and explore options that may be available.

Previous servicing requirements, under the Service Members Civil Relief Act, protected members of the military only during the time they are on active duty.

Recently released armed forces service men and women who are experiencing financial difficulty with their home mortgages should contact their mortgage servicer (the party which sends out statements, not the original mortgage company or broker which arranged the loan) to see what help may be available.