{"id":911,"date":"2012-04-23T00:38:56","date_gmt":"2012-04-23T00:38:56","guid":{"rendered":"http:\/\/blog.topbev.com\/?p=911"},"modified":"2012-04-23T00:52:05","modified_gmt":"2012-04-23T00:52:05","slug":"short-sale-review-time-shortened-by-the-fhfa","status":"publish","type":"post","link":"https:\/\/blog.topbev.com\/?p=911","title":{"rendered":"Short Sale Review Time Shortened by the FHFA"},"content":{"rendered":"

The time consuming process of selling and buying a home through a short sale may be getting much shorter in the near future. The Federal Housing Finance Agency (FHFA), the regulator and conservator of Fannie Mae, Freddie Mac, sent out a bulletin on April 17th.<\/sup> It announced the faster short sale review process and the increase in the communications sent to the short sale borrower. The new rules apply to short sale applications made on or after June 15, 2012. FHFA is also requesting that the mortgage servicers apply these new rules sooner if at all possible. What the FHFA did not do was change what the mortgage servicer must consider when it reviews the short sale application. The result of the short sale request may be the same as it would have been before, but it will be given faster. However, it does appear from tenor of the bulletin that the FHFA’s intent was to increase the number of short sale approvals as well as making the review timeline shorter.<\/p>\n

A short sale is the sale of a home in which the debts owed on the house exceed the sale price of the home. The seller is upside-down or underwater in their home. It is estimated that 25% of all homes in the U.S. are underwater. As a result a large percentage of the homes currently for sale are short sales candidates. The general observation of short sales has been that they are anything but short. For whatever reason the review process has been lengthy and the paper work has been substantial. The FHFA wants to shorten the review period. It also intends on working on the other short sale issues in the near future.<\/p>\n

The FHFA considers borrower communication and decision time lines as critical elements in the short sale process. Once the borrower files the complete application for a short sale review the mortgage servicer must provide a response within 30 calendar days from application. The servicer must notify the borrower if the application is missing information. If the application is still under review after thirty days then the servicer would have to provide the borrower with weekly updates until a final decision is made. A final decision would have to be provided within sixty calendar days from the date of the application. It is safe to assume from these changes that the FHFA was not satisfied with the current short sale application process especially as it has been applied to borrower communication and decision time lines. The FHFA changes have been universally praised as welcome revisions to the process. If the quicker responses are also combines with increased short sale approvals, the struggling housing market might get a huge shot in the arm.<\/p>\n

This quicker short sale review process is just the beginning of the FHFA’s push to avoid foreclosures. It will be making additional announcements later this year addressing borrower eligibility and changes in the evaluation, documentation simplification, property valuation, fraud mitigation, payments to subordinate lien holders and mortgage insurance, all of which are intended to increase foreclosure avoidance. FHFA wants to explore other liquidation options such as short sales and deeds in lieu as additional tools to prevent foreclosure and to keep homes occupied and help maintain stable communities.<\/p>\n

Any improvements made to the short sale process will be welcomed. The shorter review process will reduce the stress that both the seller and the buyer must endure. The additional status communications will provide information to the parties as they wait for the final approval so they are not waiting in the dark. The FHFA’ support of short sales could result in a significant increase in home sales with a positive impact on the economy in general. The short sale borrower will have to be prepared to submit their complete application from the beginning of the process to take advantage of the shorter review. An earlier negative response is still a negative response just received sooner. Competent counsel should be used as a partner in this process so that the borrower can take full advantage of this faster review process. The sale of the underwater home could be the fresh start that the borrower needs to move on with their lives. Contact Robert T. Bevans, Esq. at 781-890-6230 or at rbevans@topbev.com<\/a> with your short sale questions or other real estate questions.<\/p>\n","protected":false},"excerpt":{"rendered":"

Any improvements made to the short sale process will be welcomed. The shorter review process will reduce the stress that both the seller and the buyer must endure. The additional status communications will provide information to the parties as they wait for the final approval so they are not waiting in the dark. The FHFA’ support of short sales could result in a significant increase in home sales with a positive impact on the economy in general.<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"spay_email":"","footnotes":""},"categories":[40,164,29,3,61],"tags":[],"class_list":["post-911","post","type-post","status-publish","format-standard","hentry","category-closing","category-litigationdisputes","category-mortgages","category-real-estate-law","category-short-sales"],"jetpack_featured_media_url":"","jetpack-related-posts":[{"id":15011,"url":"https:\/\/blog.topbev.com\/?p=15011","url_meta":{"origin":911,"position":0},"title":"T&B Trending January 2015","date":"January 16, 2015","format":false,"excerpt":"\u00a0 T&B Trending January 2015 Vol 1-2015 Top StoryNovember 2014 Job Growth \u2013 7th Best Month in 10 Years Source: Dr. Ted C. Jones Job growth continues to accelerate into the fall and winter as November 2014 saw 321,000 net new jobs (preliminary) added on a seasonally-adjusted annualized rate. That\u2026","rel":"","context":"In "CFPB"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":3993,"url":"https:\/\/blog.topbev.com\/?p=3993","url_meta":{"origin":911,"position":1},"title":"First-time homebuyers given more options to buy a home by FannieMae and FreddieMac:","date":"December 10, 2014","format":false,"excerpt":"The lower down-payment requirement will allow more first-time homebuyers the opportunity to buy a home. Often the greatest hurdle for the first-time homebuyer is saving enough for a down payment. Many first-timers would try to save 20% of the purchase price that many lenders required. It can take a significant\u2026","rel":"","context":"In "closing"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":185,"url":"https:\/\/blog.topbev.com\/?p=185","url_meta":{"origin":911,"position":2},"title":"Short Sale Rules for Lenders–Our Real Estate Community Needs to Unite and Speak Out","date":"June 24, 2010","format":false,"excerpt":"Recently, in connection my my representation of an individual who was far behind in his mortgage, I encountered the following scenario. The borrower (my client) has not made a mortgage payment for more than two (2) years. The house has been on the market for 18 months. Because of my\u2026","rel":"","context":"In "Short Sales & Foreclosures"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":136,"url":"https:\/\/blog.topbev.com\/?p=136","url_meta":{"origin":911,"position":3},"title":"Short Sales and You","date":"June 23, 2010","format":false,"excerpt":"Short sales are a natural outgrowth of the recession we have been living through. People have lost jobs or become ill at the same time as the equity in their homes has been eroding. They have fallen behind in their payment or payments, yet even when they make the intelligent\u2026","rel":"","context":"In "Condominium"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":216,"url":"https:\/\/blog.topbev.com\/?p=216","url_meta":{"origin":911,"position":4},"title":"The Short Sale Samba–A Lender Does a Slow Dance, while Innocent People Involved are Victimized","date":"June 29, 2010","format":false,"excerpt":"This is a true story. After going back and forth with\u00a0respect to the consequences, legal and otherwise, I have decided not to name the Lender. What has happened, nevertheless, is true and it underscores a power within the financial institutions in our country which is unbridled, and, in my mind,\u2026","rel":"","context":"In "Short Sales & Foreclosures"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":207,"url":"https:\/\/blog.topbev.com\/?p=207","url_meta":{"origin":911,"position":5},"title":"Short Sale Shenanigans–Do not get involved; Do not let your clients get involved!!!","date":"June 29, 2010","format":false,"excerpt":"It was bound to happen. Short sales, the new salvation for an inconsistent real estate market, have too many characteristics which facilitate fraud. One party, the Lender, is being asked to take a \"hit\" for immediate payment on a delinquent mortgage. Another party, the Buyer, is getting a great deal\u2026","rel":"","context":"In "Short Sales & Foreclosures"","img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]}],"_links":{"self":[{"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/posts\/911","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=911"}],"version-history":[{"count":2,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/posts\/911\/revisions"}],"predecessor-version":[{"id":913,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=\/wp\/v2\/posts\/911\/revisions\/913"}],"wp:attachment":[{"href":"https:\/\/blog.topbev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=911"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=911"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.topbev.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=911"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}