Summary
 
This Order stops South Carolina courts from finalizing foreclosure sales on properties securing loans guaranteed by Fannie Mae, Freddie Mac or other mortgagees participating in a federal assistance program.  The Order is significantly broader than the Motion filed by Fannie Mae, which only requested the action for Fannie Mae loans.  
 
The Court reasoned that this freeze would give homeowners more time to take advantage of a new federal program to help them refinance mortgages.  The Court felt that the homeowners would have otherwise been deprived of this opportunity if their homes had been sold, which counsel felt would be "irreparable injury" for which a TRO is an available remedy

Fannie Mae felt said the ruling was necessary because South Carolina law already has a mechanism where judges can cancel a foreclosure case and start over if the sale is delayed for too long. Fannie argues that the existing law already gives lenders an incentive to expedite foreclosure cases--if the process could be cancelled and restarted, it could result in increased costs to the lender.

The court had initially been requested to address about 1,000 South Carolina Fannie Mae home loans facing foreclosure. However, South Carolina Supreme Court Chief Justice Jean Toal expanded the stoppage to foreclosures backed either by Fannie or Freddie. This is a significant expansion as Fannie and Freddie own or guarantee more loans than other lender who has agreed to participate under HMP.

Note:  The Order sets a May 15 deadline for plaintiffs (Loan Servicers/holders) in foreclosure actions to submit an Affidavit that indicates whether the loan is subject to  modification under the federal program.  The Order states that if the affidavit shows that the loan is subject to modification requirements, the foreclosure will be stayed pending a determination of whether it will be modified. If modified, the foreclosure action will be dismissed.  If the loan is not modified, the case may proceed and the Plaintiff must execute an Affidavit stating that the loan does not qualify for any of the available government programs, or that it did but the lender has exhausted all loss mitigation efforts required under the government programs.