On August 21st a news release was issued by the Federal Housing Finance Agency (FHFA) providing new standard guidelines for Fannie Mae (FNMA) and Freddie Mac (FHLMC) short sales.
Starting on November 1, 2012, Fannie Mae and Freddie Mac will ease the rules to speed up the short sale process on the loans they guarantee, even for borrowers still current on their mortgage.
One of the positives - homeowners could enter a short sale while current on their mortgage payments, but only with hardship reasons of:
• Divorce (legal separation may apply)
• Employment relocation of 50 miles or more.
Other notable highlights of the new FHFA short sale guidelines include:
- Servicers are required to reviewand respond to short sales within 30 days of receipt of a short sale offer; they must provide weekly status updates to the borrower if the offer is still under review after 30 days.
- Servicers must make and communicate final decisions to the borrower within 60 days of receipt of the offer and complete borrower response package.
- These borrowers will be eligible for a new mortgage backed by Fannie Mae or Freddie Mac for at least two years after a short sale.
- Fannie Mae and Freddie Mac will offer up to $6,000 to second lien holders
to expedite a short sale.
- Military families who receive Permanent Change of Station orders will be eligible for a short sale.
- Fannie Mae and Freddie Mac will waive the right to pursue deficiency judgments in exchange for a financial contribution when a borrower has sufficient income or assets to make a cash contribution or signs a promissory note.
Real estate agents... time to focus on taking more listings! The Las Vegas market and many markets around the country are experiencing unprecedented low inventory. Here is some positive news that hopefully will make Fannie and Freddie short sales easier to process... time will tell!
Need a Short Sale Certification? Become a Certified Foreclosure Alternatives Consultant (CFAC).
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