Up until now short sales were a two edged sword. On one side, they offered an out for those upside down in their homes and needing to sell. On the other side, they were difficulty to navigate and some banks seemed to be in no hurry or have no interest in getting them to close in a timely manner. This has supposedly changed!
On Nov. 1st Fannie and Freddie Mac set in place new guidelines to improve the short sale process and make it easier for home owners and banks to complete these stressful and difficult transactions.
Here are some of the changes or “adjustments” made:
Sellers now no longer have to be delinquent on their mortgages. This was recently the case. Sellers normally had to be 60 days delinquent, even though in the past this was not the case. Now, as long as the seller has a hardship, there is no need to be late on the mortgage. This makes total sense and should help.
Now there is no need for specific Fannie or Freddie Mac approval of a short sale as long as the seller has had one or more of the following types of hardships:
- Death or the borrower or co-borrower
- Job Relocation
This allowance will definitely speed up the time it takes to close a short sale.
A deficiency can be waived buy the bank if the seller has the means to make a financial contribution. Recently, even if the seller contributed towards the mortgage short fall, the bank still retained the right to come after the seller for any deficiency at a later date.
Military personnel automatically qualify for a short sale as long as their PCS orders change.
Fannie and Freddie Mac will now offer second lean holders $6,000 towards their losses. This has been a huge obstacle and one of the main reasons I have seen short sales not go through.
While these changes will not correct all of the inequalities in the short sale process, this is definitely a move in the proper direction.
If you or anyone you know is in danger of becoming delinquent on their mortgage, losing their home or needs to sell due to a hardship incurred or job relocation, please contact me. I am a Certified Distressed Property Expert(CDPE) and Short sale and Foreclosure Resource(SFR) agent. I have been tackling short sales and foreclosure prevention since the collapse of the real estate market over 5 years ago. I would be happy to address any concerns or answer any questions.
Also, if you are a buyer looking to capitalize on the now easier process, feel free to contact me for a complete list of short sale listings or visit these links: