The FHFA has announced changes to short sale policies that will make it easier for military homeowners with Fannie Mae and Freddie Mac loans to honor their financial commitments when they are required to move as part of their duty.
Military homeowners who receive Permanent Change of Station (PCS) orders will be eligible to sell their homes in a short sale even if they are current on their mortgage. PCS orders often require quick moves and can create hardship for military homeowners who are underwater on their mortgages, and therefore, cannot sell their home without taking a loss. Previously, many service members felt their only option was either to maintain financial obligations on two residences or to default on their mortgage.
Under the new policy, Fannie Mae and Freddie Mac will not pursue deficiency judgments, cash contributions, or promissory notes from members of the military with a change in duty station for any property purchased on or before June 30, 2012. Service members must have a Fannie Mae or Freddie Mac loan to be eligible.
Service members can check Fannie Mae or Freddie Mac websites to see if their loans are held by these GSEs or they can call hotlines for military homeowners at 1-877-MIL-4566 or 1-800-FREDDIE.
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