Great Blog, Great information for Realtors, buyers and sellers. Thanks for sharing this detailed information about how real estate should be handled. The Marcus Rice Team with RE/MAX Allegiance in Richmond Va agree with this blog.
As many of you know FHFA has been given the responsibility to oversee the GFE giants Fannie Mae and Freddie Mac. In a slew of recent changes from FHFA, Acting Director Edward J DeMarco announced on 21 July changes to short sale policies for military homeowners. Read full press release here.
Military members that are forced to move due to Permanent Change of Station (PCS) orders can sell their homes by a short sale without having to be late on payments. FHFA is now removing this requirement from the short sale approval process for Military homeowners.
DeMarco further reﬁned the policy by stating that no military homeowner that falls under this new change will be responsible for the balance. This means there will not and cannot be a deﬁciency judgment; similarly, cash contributions or promissory notes cannot be required as a condition of closing the sale.
The piece that was not talked about: Military homeowners need to be aware they will still receive a 1099C from their lender (for forgiven debt). They may or may not have to pay taxes on the forgiven debt depending on their personal situation. Military homeowners should consult a local tax attorney to make sure the short sale is still in their best interests, as a large tax bill may overshadow removing the “worries about the maintenance and leasing of a property in another jurisdiction”.
Military homeowners can follow these links to verify if their loan is owned by either.
Fannie or Freddie:
For further information please call 1-877-MIL-4566 or 1-800-FREDDIE.