Mortgage providers Fannie Mae and Freddie Mac have announced plans to freeze evictions and foreclosures over the holiday season.

The two companies said around 16,000 mortgage borrowers who are facing foreclosure between now and January 9th.

Proceedings will be suspended until the new year, allowing homeowners to speak with advisors and renegotiate the terms of their loans.

It is hoped that the arrangements will allow thousands of customers experiencing severe problems with mortgage debt to stay in their homes.

David Moffett, chief executive of Freddie Mac, said the lender is set to help three in five borrowers avoid foreclosure this year.

He said the new announcement "builds on this momentum and provides a new measure of certainty to many of these families during the holidays."

Earlier this month, Fannie Mae and Freddie Mac announced details of a mortgage support package that would ensure struggling borrowers spend no more than 38 per cent of their income on mortgage repayments.

-----------------------------------------------------------------------