Fannie Mae Announces New HomePath for Short Sales Escalation Process

Expanded Tool Will Help Prevent Foreclosures and Stabilize Neighborhoods

by: Keosha Burns


WASHINGTON, DC – Fannie Mae (FNMA/OTC) recently introduced an expanded HomePath for Short Sales tool to resolve short sale challenges.  The tool, a new short sale escalation process, is open to any real estate professional working on a short sale involving a Fannie Mae-owned loan.  Once a case is escalated, Fannie Mae will directly engage with the agent or servicer to address challenges such as valuation disputes, delays by servicers or uncooperative subordinate lien holders.  Agents can also use the new escalation process to receive a recommended list price from Fannie Mae prior to listing the property for sale.

“Our goal is to prevent foreclosures and help stabilize communities,” said Jay Ryan, vice president for real estate sales, Fannie Mae.  “By giving agents a straightforward, transparent way to escalate short sale issues to Fannie Mae, we will close more sales, prevent foreclosures and help neighborhoods continue to recover.  Getting short sales done benefits everyone involved and we’re committed to doing our part.”

Real estate professionals across the country have already begun using the HomePath for Short Sales escalation tool to resolve challenging short sale issues.

“I was working on a short sale recently with a servicer who was not being responsive, so I used the HomePath for Short Sales site to escalate the case to Fannie Mae,” said Kelby Teer, a real estate professional with HomeSmart in Phoenix, AZ.  “I heard back very quickly and within two days the sale was approved.  My clients will now be able to avoid foreclosure.”

“Fannie Mae has taken a serious step to address common issues with short sale files,” said Maryann Little, vice president for short sale mitigation with AA Premier Properties, LLC and Short Sale Mitigation, LLC in Stoneham, MA.  “I’ve found HomePath for Short Sales to be an easy tool to communicate with Fannie Mae.  Recently I escalated a file to work out a difference in valuation and in less than 24 hours it was resolved.  I appreciated that I could send comps directly to Fannie Mae and let them know what we were seeing on our side of the short sale.”

Real estate professionals can visit for information on Fannie Mae’s short sale process and to raise an issue on a particular short sale with Fannie Mae directly.

Previously, Fannie Mae has taken steps to reduce short sale timelines, expand eligibility for short sales and to prohibit servicers from reducing an agent’s commission.  Fannie Mae also secured delegation agreements with mortgage insurers to streamline the short sale approval process.  The company completed 58,376 short sales through the first nine months of 2012.

CALIFORNIA ASSOCIATION OF REALTORS® applauds Gov. Brown on signing SB 458 into law

LOS ANGELES (July 15) – The CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.) applauds Gov. Jerry Brown on signing SB 458 (Corbett) into law. SB 458 extends the protections of SB 931 (2010), to ensure that any lender that agrees to a short sale must accept the agreed upon short sale payment as payment in full of the outstanding balance of all loans.

Under previous law (SB 931 of 2010), a first mortgage holder could accept an agreed-upon short sale payment as full payment for the outstanding balance of the loan, but unfortunately, the rule did not apply to junior lien holders. SB 458 extends the protections of SB 931 to junior liens.

“The signing of this bill is a victory for California homeowners who have been forced to short sell their home only to find that the lender will pursue them after the short sale closes, and demand an additional payment to subsidize the difference,” said C.A.R. President Beth L. Peerce. “SB 458 brings closure and certainty to the short sale process and ensures that once a lender has agreed to accept a short sale payment on a property, all lienholders – those in first position and in junior positions – will consider the outstanding balance as paid in full and the homeowner will not be held responsible for any additional payments on the property.”

SB 458 contains an urgency clause making it effective upon signing.

Call Marco Rufo with questions 310.488.6914.

Short Sale Question & Answers

Short Sale Q & A

What is a real estate short sale?

A little-known alternative, once more commonly used in the real estate downturn of the early 1990’s is the “short sale,” which works like this: A homeowner falls behind on his or her mortgage payments, usually due to a job loss, rising debt payments, or both. Facing a situation in which the home value has fallen and cannot be sold for the amount of the mortgage owed. If the amount of the sale is for less than the amount owed on the mortgage, the lender gets the proceeds and discharges the remaining debt.

Also known as a real estate short pay-off or a pre-foreclosure workout, a short sale is an agreement with a lender to accept less than the amount owed by a borrower via a sale of the property to a third party.

What are the advantages of a short sale vs. a foreclosure?

While in both cases, short sale and foreclosure, the delinquent mortgage will negatively affect their credit rating, at least short sellers avoid having a “debt discharged due to foreclosure” on their credit reports. Mortgage and credit experts say that, after bankruptcy, having a foreclosure on your credit report is the worst result and will reduce your credit score by over 250 points. You could also have to wait up to several years to qualify for a mortgage at a reasonable rate.

Short sales show up on a credit report as a “pre-foreclosure in redemption” status and can result in a credit score reduction of 100 points or less or even complete being release all together. After the sale, the mortgage may show up as “discharged.” People who successfully complete a short sale may also qualify for a mortgage at a reasonable interest rate in as little as 18 months. So, if buying a home is a future goal, then a short sale is the better option for many families.

My mortgage payments are late and I may be facing foreclosure. Is the Short Sale option available to me?

We at Miramar understand as a homeowner unable to make your mortgage payment or dealing with the possibility of facing foreclosure can be a stressful experience and an emotionally painful time in your life. If you are currently behind on your mortgage payment – or predict that you will soon be unable to continue making your mortgage payments – you’re not alone: you do have an option.

We at Miramar will assist you to identify and implement the best possible short sale solution helping you to avoid foreclosure. After a thorough review of your situation by one of our Certified Short Sale Specialists, we will work your lender to come up with the appropriate solution. Miramar will diligently negotiate to secure a fair and equitable solution with your lender.

Will the Short Sale cost me anything?

There are no out of pocket upfront fees associated with the short sales. The borrower’s current lender usually pays for the real estate services provided.

What criteria must I meet to be considered in a “hardship” situation?

A hardship situation is one that is the result of some extenuating circumstance that forces the borrower into a position where they can no longer afford their mortgage payments. While every situation is different, some frequent examples of hardship include:

  • Decrease in the value of the home
  • Unemployment or loss of primary income source
  • Inability to work due to health crisis
  • Mounting medical expenses
  • Employment relocation
  • Failure of business
  • Bankruptcy
  • Death of spouse or significant other
  • Divorce or separation

What do I need to do to get started?

In addition to the homeowner proving hardship, lenders require a specific set of supporting financial documents to consider a short sale. Contact Miramar today and one of our Certified Short Sale Specialists will help you get started.

There are many more questions regrinding Short Sales; please give us a call at 310-488-6914 there is no obligation!