What’s New In Short Sales Today?
On August 27, AAR published a Federal Housing Finance Agency (FHFA) announcement informing members of new short sale processing guidelines which would become effective November 1. The article, FHFA Announces New Standard Short Sale Guidelines for Fannie Mae and Freddie Mac linked to FHFA’s news release describing the program and effective date. The new “Standard Short Sale Program” guidelines, now effective, for Fannie Mae and Freddie Mac mortgages will further streamline the process in short sale approvals.
Highlights to the new program are:
- A more streamlined short sale approach for borrowers most in need.
- Fannie Mae and Freddie Mac will offer up to $6,000 to second lien holders to expedite a short sale.
- Enable servicers to quickly and easily qualify certain borrowers who are current on their mortgages for short sales.
- 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 case contributions or sign promissory notes.
- Special consideration for military personnel with Permanent Change of Station (PCS) orders.
- The consolidation of existing short sales programs into a single uniform program.
- Provide servicers and borrowers clarity on processing a short sale when a foreclosure sale is pending.
To review the program and servicer guidelines, refer to FHFA’s August 21, 2012 announcement: http://www.fhfa.gov/webfiles/24211/ShortSalesPRFactFinal.pdf