article in the Chicago Tribune on Saturday that attempts to de-mistify this. It really does a good job at giving you both the seller and buyer perspectives. It is clearly not for everyone and requires a good amount of patience.
Fannie Mae recently announced that they will require those who can make their payments yet still move forward with a short sale or strategic default, wait seven years before they are eligible for a Fannie Mae loan. Shockingly it is estimated that there are 11 million homes across America who are under water. That means the home owner owes more on the mortgage than the current market value of the home. There are even further estimates that we could have up to 21 million households upside down in their house in three years. It seems that Fannie Mae is taking this position so homeowners think twice before going down the short sale road.
A strategic default is when a home owner walks away from their mortgage that they could pay but have decided not to because they owe more than their house is were worth at the current time. Yet there can be a variety of repercussions. One is that the loss follows you as a deficiency judgment until it is paid off down the line.
Fannie Mae has also stated that they will pursue deficiency judgments in states that allow this by law. Fannie Mae will look at each hardship as it crosses it desk. A person with an acceptable hard ship or an approved short sale will only have to wait two years before obtaining a mortgage backed by Fannie Mae. Another option for home owners is to sign over their house in a "deed in lieu of foreclosure" to avoid a lengthy foreclosure process.