New Timelines Take Effect in June
The Federal Housing Finance Agency (FHFA) has directed Fannie Mae and Freddie Mac to develop enhanced and aligned strategies for facilitating short sales, deeds-in-lieu and deeds-for-lease in order to help more homeowners avoid foreclosure. The effort will come in stages with the first taking place this June. The new, aligned timelines include the requirement that mortgage servicers review and respond to requests for short sales within 30 calendar days from receipt of a short sale offer.
“FHFA and the Enterprises are committed to enhancing the short sales and deeds-in-lieu process as additional tools to prevent foreclosure, keep homes occupied and help maintain stable communities,” said FHFA Acting Director Edward J. DeMarco. “These timeline and borrower communication announcements set minimum standards and provide clear expectations regarding these important foreclosure alternatives.”
With the alignment, servicers will be required to do the following:
- review and respond to requests for short sales within 30 calendar days from receipt of a short sale offer and a complete borrower response package;
- provide weekly status updates to the borrower if the short sale offer is still under review after 30 calendar days;
- make and communicate final decisions to the borrower within 60 calendar days of receipt of the offer and complete borrower response package.
By the end of 2012, Fannie Mae and Freddie Mac will announce additional enhancements addressing borrower eligibility and evaluation, documentation simplification, property valuation, fraud mitigation, payments to subordinate lien holders, and mortgage insurance.
Last Week in the News
The South Gate Real Estate Market is looking good.
Existing home sales rose 4.3% in January to a seasonally adjusted annual rate of 4.57 million units from a downwardly revised 4.38 million units in December. The inventory of unsold homes on the market decreased to 2.31 million, a 6.1-month supply at the current sales pace, down from a 6.4-month supply in December.
Retail sales rose 3% for the week ending February 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.2%.
New home sales fell 0.9% in January to a seasonally adjusted annual rate of 321,000 units from an upwardly revised rate of 324,000 units in December. The initial December reading was 307,000. The November rate was also revised higher to 318,000 units. At the current sales pace, there’s a 5.6-month supply of new homes on the market, the lowest reading in six years.
The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending February 17 fell 4.5%. Refinancing applications decreased 4.8%. Purchase volume fell 2.9%.
Industrial production at the nation’s factories, mines and utilities was unchanged in January after advancing an upwardly revised 1% in December. Compared to a year ago, industrial production is up 3.4%. Capacity utilization fell slightly to 78.5% in January from 78.6% in December.
Initial claims for unemployment benefits for the week ending February 18 were unchanged at 351,000. Continuing claims for the week ending February 11 fell by 52,000 to 3.392 million, the lowest level since August 2008.
Upcoming on the economic calendar are reports on pending home sales on February 27, the housing price index on February 28 and construction spending on March 1.