Government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac have changed their policies with regard to the sale of real estate owned (REO) properties held in their portfolios.
Previously, the GSEs required homeowners who had been through foreclosure and wanted to buy their home back to pay the entire amount owed on the mortgage in a single lump sum.
As per the rule change, the two companies can now sell existing REO properties to ‘any qualified purchaser at the property's fair-market value’ – meaning that if the previous owner qualifies for financing and their home is still on the market, they can repurchase their home. This requirement is similarly applied to anyone buying the home for the benefit of the previous homeowner.
In other words, the same rules now apply to everyone.
‘This is a targeted, but important policy change that should help reduce property vacancies and stabilize home values and neighborhoods,’ says Mel Watt, director of the Federal Housing Finance Agency, conservator of the GSEs, in a release. ‘It expands the number of potential buyers of REO properties and is consistent with the enterprises' practice of requiring fair-market value for those properties.’
For more, click here.