Tempe Real Estate Short Sale Guideline and Information Hot Line – Fannie and Freddie Set Timeline Requirements for Short Sales




Beginning June 15, real estate agents working with distressed homeowners in Tempe and Throughout Phoenix, Arizona whose loans are backed by Fannie Mae and Freddie Mac should expect to receive a decision on a short sale offer within 30-60 days.

The GSEs issued new guidelines Tuesday that fall under the Servicing Alignment Initiative rolled out last fall and aim to bring greater transparency to the short sale process and expedite decisions related to these pre-foreclosure sales.

Not only is a short sale an effective foreclosure alternative when home retention is no longer an option, but it keeps homes occupied and helps to maintain stable communities, according to the Federal Housing Finance Agency (FHFA).

Addressing real estate practitioners’ No. 1 complaint about short sales, FHFA directed Fannie Mae and Freddie Mac to establish a new uniform set of minimum response times that servicers must follow in order to facilitate more efficient short sale transactions.

The GSEs’ new short sale timelines require servicers to make a decision within 30 days of receiving either an offer on a property under the companies’ traditional short sale programs or a completed Borrower Response Package (BRP) requesting short sale consideration, whether it’s through the federal government’s Home Affordable Foreclosure Alternative (HAFA) program or a GSE program.

If more than 30 days are needed, servicers must provide the borrower with weekly status updates and come to a decision no later than 60 days from the date the BRP or offer was received.

According to the GSEs, this 30-day add-on will provide some leeway for servicers who may need more time to obtain a broker price opinion (BPO) or a private mortgage insurer’s approval for a short sale. All decisions must be made within 60 days.

In the event a servicer makes a counteroffer, the borrower is expected to respond within five business days. The servicer must then respond within 10 business days of receiving the borrower’s response.

The GSEs plan to use the new short sale timelines to evaluate servicer compliance with the Servicing Alignment Initiative.

Edward DeMarco, acting director of the FHFA, says the GSEs new borrower communication and timeline requirements for short sales “set minimum standards and provide clear expectations regarding these important foreclosure alternatives.”

GSE servicers must comply with the new minimum communication time frames for all short sale evaluations conducted on or after June 15, 2012, although servicers are encouraged to begin implementing the new requirements sooner.

“I applaud Fannie and Freddie for finally coming out with real guidance with real world timelines for their servicers,” commented Anthony Lamacchia, broker/owner of McGeough Lamacchia Realty Inc., which specializes in short sales. “There is no question that this will help short sales and the market as a whole.”

Last year Freddie Mac completed 45,623 short sales, a 140 percent increase since 2009. Fannie Mae’s short sale completions shot up by 101 percent over the same period, totaling around 79,800 in 2011.


1. Hire a short sale specialist like Juan Pesqueira Group 480.458.8007. Not all Realtors are experienced in short sales. Depending on what kind of short sale you are requesting (the Federal government has a program called, “HAFA,” which among other things gives the homeowner $3000 in relocation assistance) or a regular short sale, your Realtor MUST be well versed in the qualifications and guidelines that your bank requires for a short sale approval. Hiring a Realtor that is well informed about the changes in the various short sale programs will be the difference between an approval or a denial.

2. Have all your ducks in a row at the listing appointment. The top reason that many short sales are denied is incomplete documentation from the homeowner. A short sale specialist will give you a list of documents you will need prior to your listing appointment. Make sure you provide your Realtor with all of the requested documentation at the listing appointment. Banks will not review your short sale request for approval unless all documents are received and scanned into their systems. Many banks loose documents during the process and that too has led to denials. If you submit a complete package upon first submission you better your chances for a timely review of your file and a subsequent approval.

3. Give all details about liens on property. Make sure you tell your Realtor if there is a line of credit or a second or third lien on your property. Your Realtor is going to have to negotiate with EVERY lien holder on the property in order to convey clear title (a title free of any liens or encumbrances) to a prospective buyer. You will not have a successful short sale unless all previous liens are released!

4. Provide additional documentation in a timely manner. Many times during the short sale process the bank will require additional documentation (such as updated pay stubs and bank statements). Because the short sale process can take up to 90 days these documents will need to be updated every 30 days. Make sure to provide your Realtor with updated documentation in a timely manner. It will help to move the process along faster and help you move on with your life!

5. Real Estate Agent must be proactive and on top of the bank calling every few days to make sure everything is being done, to get answers, and what to expect. A short sale is a hand on process and the banks have to understand that you want this completed in a timely manner.  The bank need to feel pressured for a response. If your agent is not hands on or proactive that could be the deciding factor of obtaining short sale approval and successfully closing a short sale or not.  Call The Juan Pesqueira Group if you want a hands on, proactive agent who will be on the banks A** to get final approval.  We Close short sales!

Are you about to loose your Home or Condo in Tempe, call us at 480.458.8007 or Visit our SITE.





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