Great news for Fannie Mae and Freddie Mac borrowers who are facing foreclosure!
Fannie Mae and Freddie Mac has announced that starting November 1, 2012, they will be conducting new Short Sale guidelines that allow easier and quicker Short Sale approval process for homeowners who are behind on payments and requesting for Short Sale.
This act demonstrates Fannie Mae and Freddie Mac’s willingness, determination and commitment to Short Sales by increasing the efficiency through streamlining the processes and expanding the acceptance requirements.
These changes include:
- Servicers such as the banks have the ability to approve the Short Sale that follows the guidelines without asking Fannie Mae and Freddie Mac for approval.
- Allow Short Sales for people who need to relocate more than 50 miles due to their jobs.
- People who are 90 days or more behind on their payments and with a credit score of 620 or lower will no longer need to prove hardship.
- Borrower who has enough income can sign promissory notes and Fannie Mae and Freddie Mac will not pursue deficiency judgments.
- To prevent second lien holder holding up the Short Sale, they will be offered up to $6000.
- Borrowers who are not in default but incur hardships such as divorce/legal separation, death of borrower or co-borrower, illness or disability or job transfer can now qualify for Short Sale
- Military personnel who are required to relocate will automatically be approved for Short Sale even if they are not behind on payments.
- Short Sale decision by the servicer has to be made within 30 to 60 days.
The hope is that these changes will allow the lending industry to prevent foreclosure and assist Freddie Mac and Fannie Mae’s vision to help people minimize Foreclosure impact to their credit.
This is definitely excellent news for people who are experiencing hardship and delinquent on their mortgage a sigh of relief and the light at the end of the tunnel!