Today, the Federal Housing Finance Agency announced changes to short sale policies that will make it easier for military homeowners with Fannie Mae and Freddie Mac mortgages to honor their financial commitments when they are issued a Permanent Change of Station (PCS) order.

Changes to the short sale policies will alleviate some of the issues faced when a member of the armed forces receives a PCS order including the burden of having to sell their home in a different housing market.

Congressman Smith has been an active supporter of policies and legislation that address military and veteran homeownership issues including cosponsoring the Military Family Home Protection Act that would improve protection for service members against foreclosures.

Service members with PCS orders will be:
  • Eligible for a short term sale immediately, even when they are current on their existing mortgage (the PCS order is treated as a hardship to deem them eligible)
  • Exempt from deficiency judgements from Fannie Mae and Freddie Mac when receiving permission for a short sale; and 
  • Relieved of any request or requirement for a cash contribution or promissory note so long as the property was purchased on or before June 30, 2012, to apply personal assets to cover the shortfall after outstanding unpaid principal balance and sale price) 
The Federal Housing Finance Agency will issue guidance by September 30, 2012 and it will be effective 60 days later.

For more details and eligibility requirements, click here.

To check if your loan is held by Fannie Mae or Freddie Mac, visit them online or call the hotlines for military homeowners at 1-877-MIL-4566 or 1-800-FREDDIE.