An Express Article from the California Land Title Association
Bulletin 12/13-53 - November 15, 2012
Short sales involving home loans guaranteed by federal mortgage lenders Fannie Mae and Freddie Mac will now be simplified under new rules that went into effect November 1st. The rules attempt to speed up the short sale process through three different means, chief among them allowing borrowers current on their payments to qualify for a short sale if they can prove a hardship. Eligible hardships include: relocation for a job, divorce, death of a borrower or co-borrower, disability, among others.
Deficiency judgments can also be waived under the new rules if the borrower pays a portion of the loan balance or signs a promissory note. Lastly, Fannie and Freddie are attempting to make reluctant second lien holders more amenable to short sales by allowing them to collect up to $6,000 during the short sale process.