FHFA issues new guidelines for Fannie/Freddie Short Sales

Back in June, the Federal Housing Finance Agency 'FHFA' announced that strict timelines for servicers to respond to short sales within 30 days of receipt of a short sale offer, provide weekly status updates to the borrower, and communicate a final decision to the borrower within 60 days of receipt of the offer. They have followed that up with new guidelines that will take effet November 1, 2012: •Eliminates current Fannie Mae and Freddie Mac short sale programs and creates a single standard short sale process for both entities (Fannie and Freddie HAFA programs will expire at the end of the year). •Enables servicers to quickly and easily qualify certain borrowers who are current on their mortgages for short sales without waiting for an approval from Fannie Mae or Freddie Mac •Offers special treatment for military personnel with Permanent Change of Station (PCS) orders. •Standardizes and clarifies foreclosure suspensions on a property with an approved short sale. •May pay borrowers up to $3,000 in relocation assistance. •Fannie Mae and Freddie Mac will offer up to $6,000 to subordinate lien holders to expedite a short sale. In addition, FHFA clarified that a borrower experiencing a hardship must wait at least two years before becoming eligible for a Fannie Mae or Freddie Mac loan. We haven't experienced the complete implementation and follow through of the items from June and hope that will improve. It will be interesting to see how these guidelines are implemented from November 1st forward and what the transition will involve for HAFA qualified applications that don't close by year end. Stay tuned and Keep the faith! La Quinta Real Estate