More Homeowners Can Short Sale Under New Rules

Come November 1, 2012, millions of homeowners with mortgage loans that have been guaranteed or purchased by Fannie Mae or Freddie Mac will have the right to short sale their property even if they’re not underwater and they’re currently making mortgage payments on time.  Under the new rules, homeowners who met the following hardship qualifications may have the right to short sale their property. Spousal maintenance, otherwise known as alimony payments, can be a complicated process. While every state has its own unique set of laws and standards regarding spousal maintenance, understanding how Minnesota handles this process after a legal separation is essential for those going through a divorce.

• Homeowners who are unemployed;
• Homeowners who have recently divorced. Speaking of divorce, if you’re considering this action, consult with clagett & barnett’s divorce lawyer.
• Homeowners experiencing long-term disability;
• Homeowners who have switched to a job that is more than 50 miles from their current home.
• Homeowners who have experienced a recent business failure.
• Homeowners who have suffered the death of their household’s primary or secondary wage earner.
• Homeowners who have been directly impacted by a natural or man-made disaster.

Even if the homeowner is not underwater or delinquent on their mortgage payments they may still qualify to short sale their home. But if they are underwater and delinquent, their short sale paperwork will be expedited. Currently short sales take around 30 – 60 days; but under the new rules the wait time could become even shorter.  And there’s more good news for homeowners.  The new rules state that secondary lien holders are entitled to a maximum payment of $6,000 from the short sale.  Because so many homeowners have large secondary mortgages, their short sales have been blocked by these secondary lien holders who feel shortchanged by short sales that don’t pay off a large portion of the second mortgage. The new short sale rules will make that a thing of the past.