Fannie Mae to Fix Glitch that Harms Some Consumers’ Credit

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This, fairly simple to fix, problem has been going on for years and the government is just now getting around to trying to fixing it. Please read the article below and let me know what you think.

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Because of a shortcoming in Fannie Mae’s software, many homeowners who sold their homes through short sales have suffered undue harm to their credit and additional penalties preventing them from attaining new mortgage loans for several years, according to Sen. Bill Nelson (D-Florida), who has been working toward a solution to the problem.

Short sales were relatively uncommon prior to the housing crisis, but with so many homeowners slipping underwater, short sales have served as a solution for many who are unable to pay their mortgages, with the added benefit of helping lenders and investors mitigate their losses.

Fannie Mae’s software reportedly does not offer a “short sale” label, and therefore short sales have been labeled as foreclosures in the GSE’s system.

While short sales may have some effect on credit, foreclosures are more harmful. Furthermore, after a foreclosure, an individual cannot obtain another mortgage loan for seven years in most cases.

After a short sale, an individual has to wait only two years before applying for a mortgage loan.

Florida suffered some of the highest foreclosure and underwater rates in the nation during the housing crisis, and Sen. Nelson has taken interest in the misrepresentation that has harmed many of his constituents.

To see the complete article – please use the link below.

Fannie Mae to Fix Glitch

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