BREAKING NEWS - Important Changes to Short Sale Wait Periods and HomePath Progam ~ FANNIE MAE
Big Changes are on the way from Fannie Mae (This applies to conventional loans). The current wait period after a short sale to obtain a mortgage is 2 years if a buyer is putting 20% down. On August 16th, the waiting period will become 4 years. This means if you are currently looking to buy and in this scenario, you must have a loan application submitted to your lender before August 16th or you will have to wait 4 years to be eligible for a conventional loan.
The news isn’t officially out from Fannie yet, but the industry expects an official announcement in early July.
On June 17, 2014: Fannie Mae issued Desktop Underwriter Release Notes for a DU release on August 16, 2014. Among other things, the DU update will require a four-year waiting period for borrower’s who have a previous deed-in-lieu of foreclosure or a pre-foreclosure sale (short sale). The waiting period will be two years for borrowers if the deed-in-lieu or pre-foreclosure sale was due to extenuating circumstances. Fannie Mae has not published a Selling Guide announcement on this topic. We expect the announcement in July and the announcement will have further details and guidance.