The law used to be that foreclosed homeowners could not buy their own house at the foreclosure sale. Neither could third parties acting for the benefit of the former homeowner. That is beginning to change now. Federal Housing Finance Agency (FHFA) will now allow foreclosed homeowners to pay fair market value for their foreclosed home! This could save some people tens or hundreds of thousands of dollars and allow good people to see their home value go “above-water”.
“This is a targeted, but important policy change that should help reduce property vacancies and stabilize home values and neighborhoods,” said FHFA Director Melvin L. Watt. “It expands the number of potential buyers of REO properties and is consistent with the Enterprises’ practice of requiring fair-market value for those properties.”
This only applies to about 121,000 homes in the Fannie Mae/ Freddie Mac inventory after November 25, 2014. It’s a good start!