Recent articles about short sale strategic default of vacation home and investment properties, like those in Destin Florida, have caused a stir.
An October 2012 Federal Housing Finance Agency
(FHFA) report stated that Fannie Mae and Freddie Mac, which are enterprises it oversees, don’t uniformly pursue collection of short sale deficiencies
. A deficiency is the balance of the mortgage note that was not paid after a short sale or foreclosure. The audit, FHFA’s Oversight of the Enterprises’ Efforts to Recover Losses from Foreclosure Sales
addressed “strategic default”, which is when a borrower allows a foreclosure to occur (walks away) or perhaps does a short sale without a true hardship. In these cases, there could be better collection efforts and recoveries of deficiency balances, according to the audit.
The report suggested that FHFA will provide future guidance in the deficiency collection process to Fannie Mae and Freddie Mac to get substantial monies recovered. Corrective action planned per the report to better oversee and collect deficiencies would be based on these criteria, among others:
1. Type of property foreclosed on (specifically naming real estate investors and vacation home owners)
2. Amount of deficiency
3. Cost to collect
The audit stated “FHFA would not encourage the Enterprises (Fannie Mae and Freddie Mac) to pursue all borrowers including those unable to pay….”
Sellers who have completed short sales, for example, in resort towns like Destin Florida or Santa Rosa Beach, and have not received a waiver of deficiency may be pursued in the future. If you choose to do a short sale without a waiver of deficiency or “walk away” from a mortgage through foreclosure, you should consult with an attorney first.
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call toll-free 1-877-487-9639 or local 850-650-7883 ext 204
Email Wendy: [email protected]
Destin Florida Short Sale Help
Wendy Rulnick, Broker, is a short sale and pre-foreclosure specialist and has been featured in “Kiplinger Personal Finance Magazine” and “Florida Realtor Magazine”. She has successfully helped hundreds of families avoid foreclosure through short sale along the Emerald Coast of Florida. Wendy Rulnick is knowledgeable in all aspects of short sale, including VA Compromise Sale, FHA HUD pre-foreclosure sale, HAP military PCS, HAFA, Bank of America Coop program and more. She is also co-founder of www.ShortSaleSuperstars.com and short sale instructor to agents across the United States. Wendy Rulnick sells real estate in Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Panama City Beach, Eglin AFB, Hurlburt Field.