Well, to qualify after that two year period, the new guidelines requires a minimum 20% down payment — except if there is/are “extenuating circumstances” such as loss of a job, divorce or medical expenses, etc.  Now, according the housing predictor post, Freddie Mac will continue its four (4) year period unless "...extenuating circumstances can be demonstrated...."  Housing Predictor   In addition, Mortgage applicants still have to demonstrate that they have been paying other bills in a timely fashion and get good marks in their credit bureau files.

What troubles me about this 'extenuating circumstances' is that if the borrower initially at the commencement of the Short Sale or Deed In Lieu presented the lender with a hardship letter attached to the What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr package, then shouldn't that be an extenuating circumstance of its own?  We'll see how they apply this requirement after July 01, 2010.  Because I myself, as an investor that have handle short sales for homeowners know that every homeowner did not have to provide a hardship letter as long as the hardship was forseeable.  Others involve default, delinquent, underwater, up side down property value. Time will tell.

To begin with, I personally believe the Obama administration’s new What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr assistance program (where mortgage servicing companies receive an incentive of $1,000 for successfully handling a What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr and the mortgage holder receive a relocation fee incentive of $1,500 to short sell their property), has certain criterias that I am not in favor of.  For example, under HAFA (Home Affordable Foreclosure Assistance) the borrower will have to first had been either inelegible for the HAMP (Home Affordable Modification Program) or been previosly denied for a A Forensic Loan Modification Audit carefully examines the terms of the lender's mortgage contract fo.  The other thing about this HAMP program that I didn't like is that if the homeowner did not fulfill the trial A Forensic Loan Modification Audit carefully examines the terms of the lender's mortgage contract fo or defaulted even after receiving a permanent A Forensic Loan Modification Audit carefully examines the terms of the lender's mortgage contract fo, they will have the homeowner sign an agreement that in the event the homeowner defaulted on the payment, the bank can then proceed to take possession of the house and foreclose on it.  I am sure most Real Estate Agents doing this Short Sales for the bank fail to mention this part to the homeowner.  This is why doing a What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr with an ethical and educated Real Estate Investor is a better option that this HAFA What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr Program.

Next, you have Ms. Marietta Rodriguez, director of homeownership and lending for NeighborWorks America, a national nonprofit network created by Congress to assist with homeowner financial counseling and community development quoted as saying "This is a positive move...." and "...We all know that there are many people who through no fault of their own have to sell," she said, but they were blocked from buying a house again for four years or longer, even though they had rebuilt their credit, had qualifying incomes and were fully capable of handling a mortgage responsibly.  Washington Post

While Ms Marietta applauds Fannie Mae move toward the right direction on providing some future benefits, she also adds there's some complication in Fannie's new approach in its credit-rehabilitation requirements. Because on top of it all, Fannie expects borrowers to reestablish their credit enough to get by from the company's automated underwriting system that considers credit bureau data, among other factors.

However, according to Fannie's bulletin to lenders, Fannie Mae will not consider applicants with "nontraditional" credit or "thin files," where there is not enough history on file with the national credit bureaus to generate a risk score. I will assume this is not applicable to the homeowners that were facing foreclosure and by no fault of their own had no choice but to turn their house to a What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr or Deed In Lieu.  Much better than just simply walking away from the property and letting the bank do as they please.  With the end result of having a foreclosure on their credit.

Rodriguez worries that many homeowners who have lost their houses during periods of high unemployment and stricter underwriting requirements by banks won't have sufficiently "traditional" credit histories -- home-equity lines, revolving credit card accounts, personal loans and the like -- to pass Fannie's test. After the years of recession, their main credit data may instead be their rent payment histories and telephone and utility bill payments, none of which show up in the national credit bureaus' files.

As an investor, this is information I provide when negotiating with a distressed seller, to help enlighten them to the benefits of working with me to pursue a What is a short sale? A short sale is a sales transaction in which the seller's mortgage lender agr versus foreclosure.

For more information, get your FREE Report '5 Ways To Stop Foreclosure In Its Track' at Stop Foreclosure With Short Sales or CALL NOW the telephone numbers on you upper-right corner of the screen or email me. 

Please post your comments below and let me know what is your opinion and what else we can do to continue helping more homeowners.  Read more on Short Sales or on our FREE Forensic Mortgage Loan Audits services.

Thank You!