WASHINGTON - Citigroup Inc. will suspend foreclosures and evictions for 30 days in a temporary break for about 4,000 borrowers during the holiday season.
The Manhattan-based bank said Thursday the suspension will run from Friday through Jan. 17. It applies only to borrowers whose loans are owned by Citi. Borrowers who make payments to Citi but whose loans are owned by other investors are out of luck.
"We want our borrowers to have a much less stressful time, to spend their time with their families during the holidays as opposed to worrying about their homes," Sanjiv Das, head of the company's mortgage division, said in an interview.
The suspension means Citi will halt foreclosure sales and stop evicting homeowners from properties it has already seized. The company projects it will help 2,000 homeowners with scheduled foreclosure sales and another 2,000 that were due to receive foreclosure notices. Das also said the company is working on "some long-term fundamental alternatives" to foreclosure, but declined to be specific.
Most major lenders suspended foreclosures last winter while the Obama administration developed its $75-billion loan modification program. Foreclosures picked up again after those suspensions lifted. In recent months they have fallen as banks evaluate whether borrowers qualify for the government program.
Industrywide, lenders and housing advocates say getting troubled borrowers to call is one of the biggest problems in saving homes. Many homeowners never contact lenders, abandoning their homes.
Citibank spokesman Mark Rodgers said the suspension period is timed for the holidays partly because that's when a lot of people take off work and have the chance to handle personal issues.
"It's kind of a pause button that we've hit," he said. "Oftentimes we are unable to contact these borrowers, so there's nothing we can do except move to foreclose."
Staff writer Ellen Yan contributed to this story.