Great news for (previous) short sellers who have been forced to remain on the sidelines because their short sale was being (mis) reported as a foreclosure on their credit reports.
Fannie Mae has designed a fix for a computer software problem that erroneously reported “short sales” as “foreclosures” on consumer credit reports.
Editors’ Note: It is very likely that HUD (FHA and VA) will correct its software by years end!!
For more info: “Wait Times for Boomerang Buyers” .
Fannie / Freddie guidelines call for foreclosed borrowers to wait 7 years before receiving a new loan, but short sellers could qualify in 2 years with 20% down or 4 years with less than 20% down.
Following Fannie’s reprogramming of the software which goes into effect Nov. 16, 2013, lenders will be able to input certain codes in an explanation field of the on line loan application to indicate a short sale or deed-in-lieu.
