WASHINGTON (11/26/14)--A change to Fannie Mae and Freddie Mac's existing real estate owned (REO) properties policy will allow the enterprises to sell existing REO properties to any qualified purchasers at fair-market value. The Federal Housing Finance Agency (FHFA) directed Fannie and Freddie to make the change Tuesday.
The change is limited to Fannie Mae and Freddie Mac REO inventory of single-family homes as of Nov. 25, which is roughly 121,000 properties.
Previously, Fannie and Freddie required homeowners who have been through foreclosure and want to buy their home back to pay the entire amount owed on the mortgage. This applied to anyone buying the home for the benefit of the previous homeowner as well.
The new rule applies to existing REO properties and allows homeowners who are able to repurchase their home, or a third-party able to purchase on their behalf, to do so under the fair-market value policy that already applies to other purchasers of REO properties.
According to a release by the FHFA, certain property exclusions may apply and will be handled by the Fannie and Freddie on a case-by-case basis.