Short Sale Changes to Freddie and Fannie
Good news for real estate investors, first time home buyers, and agents that work in short sales!
Starting June 15 agents working with distressed homeowners whose loans are handled by Fannie Mae and Freddie Mac can expect to get a decision of their short sale offer within 30-60 days. The new guidelines issues by the GSEs fall under the Servicing Alignment Initiative rolled out last fall and aims to bring more transparency to the short sale process and also to expedite decisions related to these types of pre-foreclosure sales.
You can find more info on what short sales are here.
In essence a short sale is not only an effective foreclosure alternative when keeping the home is not an option but it also helps keep homes occupied and maintains a more stable community. These new changes will hopefully address real estate agents number one complaint concerning short sales by establishing a new uniform set of minimum response times that services must follow.
So what happens if more time is needed?
If more than 30 days is required services must provide the borrow with weekly updates on progress and must come to a decision no later than 60 days from the date of the BRP/offer was received. Should a service make a counteroffer the borrower is then expected to respond within 5 business days; the servicer must respond within 10 business days of receiving the borrower’s response.
For the most part these changes come as a welcome relief to what can be a complicated process. Are you facing foreclosure, or need help understanding short sales? Talk to me and see how working with a qualified REALTOR® can help you!