With all of the ballyhoo about the foreclosure settlement, sometimes the smaller announcement get tossed in the vault. This recent update from the Single Family Seller/Servicer Guide Bulletin of the Freddie Mac Servicing requirements looms important for homeowners.
The Guide reinforces the requirement that the Servicer, for itself and on behalf of
Freddie Mac, must waive all rights to pursue payment of the remaining balance owed by the Borrower under a Freddie Mac-owned Mortgage for all approved short payoffs and deed-in-lieu of foreclosure transactions that have closed in accordance with the Guide and applicable law.
Now we’re still not big fans of deed-in-lieu because it sometimes puts the homeowner in a position lacking power and options.
However, the short payoff will be great news or anyone using the new Kill Your 2nd pilot program that we discussed a few weeks ago.