Fannie Mae issued a news release that warns servicing companies that Fannie will be monitoring all delinquent loans to ensure that foreclosures are being processed within a timely manor. The main purpose of the Fannie Mae announcement was to make the servicing companies aware of Fannie’s intention to get all non-performing loans off there books as quickly as possible.
They also stated that there will be penalties for poor servicing performance as it applies to foreclosures. “A compensatory fee not only compensates Fannie Mae for damages but also emphasizes the importance placed on a particular aspect of the servicer’s performance,” the GSE stated in its servicing guide.
Fannie also updated the allowable time frame for foreclosure in each state. The California foreclosure time line stayed the same at 120 days.
This could mean the days of homeowners staying in their homes for a year or two without making a payment are over. There are several options to foreclosure including loan modifications, short sale, deed in lieu of foreclosure etc… It is best to contact your lender immediately and be proactive in solving the delinquency.
You can read the full news release here.