Fannie Mae

Fannie Mae and Freddie Mac have recently issued new short sale guidelines to their mortgage servicers. The intent of these new guidelines is to consolidate existing short sales programs into one standard short sale program, and streamline program rules in order to quickly and easily qualify eligible borrowers for short sales. The new guidelines take effect November 1, 2012. 

A summary of the changes: 

• Short sale documentation to be reduced or even eliminated for those who are behind on payments, have bad credit and serious financial hardships.
• Servicers will now be allowed to approve short sales without investor approval for those who are current on payments but face certain hardships including: death, divorce, disability, and distant…

I’ve been hearing a lot lately about Fannie Mae forcing customers to go into default in order to approve their short sales, so I knew we’d be up for a rough road with this client. While most of my clients are behind in payments by the time they call me, this CT home seller had reasonable income, heavy liquid assets, great credit and intended to not miss any payments in order to preserve her excellent credit.

Any condo in Connecticut is a tough sell right now as condo financing options here have really crumbled. However, after 2 months on market a buyer was secured for the condo. Chase’s (the servicer on this Fannie Mae loan) short sale processing has really eroded over the last few years, and gets more difficult and time consuming all the time.…

Fannie Mae Guidelines Update: No new mortgages for 7 YEARS after foreclosure

Fannie Mae has recently introduced new guidelines for mortgage underwriting, and is getting tougher on those who have experienced a prior foreclosure.

The time that must have elapsed after a foreclosure is up to 7 years from the previous 5. The changes highlight the importance of borrowers working with their servicers to avoid foreclosure and pursue other workout solutions, including short sales. 

Fannie Mae Waiting Period Requirements as of 10/1/2010

BANKRUPTCY Chapter 7 or 11: 4 years

BANKRUPTCY Chapter 13: 2 years from discharge date or 4 years from dismissal date

FORECLOSURE: 7 years

DEED IN LIEU OF FORECLOSURE, PREFORECLOSURE SALE, SHORT SALE:

• 2…

Effective April 30, 2010, Fannie Mae has changed the required waiting period for a borrower to be eligible for a mortgage loan after a preforeclosure event. The waiting period commences on the completion date of the preforeclosure event, and may vary based on the maximum allowable LTV, CLTV, and HCLTV ratios (referred to herein as LTV ratios) and occupancy of the property.

A summary of the changes: 

Read the entire Fannie Mae announcement

Are you considering or involved in a short sale in Greater Hartford/Eastern Connecticut? Wondering what it will take to buy a new house again one day?

Guidelines for post short sale borrowers are getting better all the time. Assuming you have taken other measures to improve your credit post short sale, gaining new financing is very possible after just a few years. 

A Fannie Mae mortgage will be available to you two years after your short sale, assuming you qualify otherwise. In fact, if you managed to not miss any payments prior to your short sale, you can get new financing immediately.

The FHA will also lend to you immediately after a short sale with no missed payments, or three years later if you were in default at the time of the short…