Often I am helping or advising folks here in the Wilmington NC Real Estate market area. A surprising number of them are upside down in their homes and are facing the need to sell due to hardships. It is very difficult for these folks and though "short sales" or "Deeds In Lieu" of Foreclosure are usually better than foreclosures, credit wise, it is still quite a hit to their credit and ability to purchase a home in the future. I saw this article and thought I would share it. Looks like Fannie Mae also realizes bad things happens to good people and is making some policy changes to keep the wait to buying a new home more reasonable and less of a credit "prison". Here's the story:
Daily Real Estate News | April 26, 2010 |
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Fannie Adds Incentive to Avoid Foreclosure
Beginning in July, Fannie Mae will allow financially troubled home owners to complete a “deed in lieu of foreclosure” or a short sale and be eligible to apply for a new Fannie-backed mortgage in two years.
Currently, borrowers who have completed a deed-in-lieu must wait four years to apply for a loan that Fannie will purchase. Home buyers who go through foreclosure must wait five years.
All these waiting periods can be reduced further, if the potential buyer can show extenuating circumstances. "We are beginning to think about post-recession, how you address borrowers who became unemployed through no fault of their own ... and now deserve the right to re-enter the housing-finance system," said Federal Housing Association Commissioner David Stevens.
Source: The Wall Street Journal, Nick Timiraos (04/26/2010)
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