Fannie Mae gets tough on homeowners who walk away

[keepinitreal]

June 24, 2010

The mortgage giant plans to go to court against those who can afford to make their payments but decide it's not worth it. It also will limit their access to future loans.

http://www.latimes.com/business/la-fi-fannie-walkaways-20100624,0,2953782.story

[BCA2009]

What bunch of morons!

1) How are they going to prove that it was a "Strategic Default" rather than just being unable to afford to pay the loan?

2) A different arm of te federal government will end up giving every incentive in the book to anyone who will buy new homes, just to "stimulate the housing market".

3) Fannie May/ Freddie Mac are profit driven entities. 3 years from now they will back any sale that they think they can make money on. They are not going to refuse to make loans just out of spite because someone walked away in the past.

4) Most states already allow recourse. So that part of the logic doesn't make sense except for a few states.

5) They recommend short sales. Short sales are hard to get approved, but ignoring that, how is a short sale really any different than a strategic default that gets sold after foreclosure. In both cases the bank is accepting the market value of the property and losing out on the difference.

What a bunch of morons!

[NHC]

This makes me wonder about one line in the article I just posted....

Fannie Mac & Bank of America ....sold a woman's house on auction (without telling her or having much reason to) 'back to themselves for more than what she owes"....it makes me wonder if they're doing this to maybe beef up their financial portfolios...to some future end.

[majicman50]

I totally agree with you on the method of sale concerning distressed property. What difference does it make other than the bottom line how it is transfered? I really can't imagine that lenders get any real $$$ from sheriff's sales or auctions! Besides. an immediate sale would likely not leave the property vacant so long. In the long run how much do the banks loose by opting not to refi and market value than to allow foreclosure? Has anyone actually done the math???

[bulletproof77]

And I wonder just which political party is behind the move to go to a "lifetime" FHA loan ban ??? Let me guess..

[espo1357]

June 24, 2010

The mortgage giant plans to go to court against those who can afford to make their payments but decide it's not worth it. It also will limit their access to future loans.http://www.latimes.com/business/la-f...,2953782.story

YAWN.
They have no leverage.

People need to know their rights to fight this nonsense. Like filing for BK.