Fannie mae and Freddie mac have come up with new rules.:
As reported by the LA Times, Fannie and Freddie have finalized their new “streamlined” short sale guidelines effective Nov.1st.
Here are the highlights of the finalized criteria:
Fannie Mae and Freddie Mac will allow borrowers who are current on their mortgage payments to qualify for short sales, provided they fit the hardship criteria.
Hardship criteria are defined as:
Unemployment; divorce; long-term disability; a change of employment that is more than 50 miles from the current home; a business failure; death of the primary or secondary wage earner; or a natural or man-made disaster.
Under the new Fannie-Freddie rules, second lien holders will be entitled to a maximum of $6,000 (vs. $3K) out of the proceeds of the sale. This could be amazing. We could approach 2nd lien holders who have a large lien and offer them way more than 6k.
In states where Fannie and Freddie have the legal right to pursue “deficiencies” when short-sale proceeds do not pay off the existing debt, homeowners who have sufficient assets or income instead will be “ASKED” cover part of the shortfall.That’s funny. Suppose they say no?