Defaulting borrowers who walk-away and had the capacity to pay or did not complete a workout alternative in good faith will be ineligible for a new Fannie Mae-backed mortgage loan for a period of seven years from the date of foreclosure. Borrowers who have extenuating circumstances may be eligible for new loan in a shorter timeframe. ...The government's home buyer tax credit has been subject to fraud. (Duh!)
Fannie Mae will also take legal action to recoup the outstanding mortgage debt from borrowers who strategically default on their loans in jurisdictions that allow for deficiency judgments. In an announcement next month, the company will be instructing its servicers to monitor delinquent loans facing foreclosure and put forth recommendations for cases that warrant the pursuit of deficiency judgments.
More than 1,200 prison inmates, including 241 serving life sentences, defrauded the government of $9.1 million in tax credits reserved for first-time homebuyers, according to a Treasury Department report released Wednesday.The federal government is doling out more money to help homeowners (but not renters, of course, because they are second-class citizens):
Treasury's inspector general also found that thousands of people filed multiple claims or made claims outside the allotted time period. In all, more than $28 million was improperly doled out.
The U.S. Treasury Department said Wednesday it had approved five states' plans to aid homeowners in the hope of thwarting foreclosures in communities hit hard by the recession.
State housing agencies in Arizona, California, Florida, Michigan and Nevada will receive a total of $1.5 billion from the Obama administration's "Hardest Hit Fund." ...
Arizona is set to receive $125.1 million, California $699.6 million, Florida $418 million, Michigan $154.5 million and Nevada $102.8 million.
Five other hard-hit states have plans that are pending. If the plans are approved, those states could get a total of $600 million: North Carolina ($159 million), Ohio ($172 million), Oregon ($88 million), Rhode Island ($43 million) and South Carolina ($138 million).