Strategic Default – Penalties coming from Fannie Mae

If you have a mortgage backed by Fannie Mae (FNMA) and engage in a strategic default, you won’t be eligible for another FNMA-backed mortgage for seven years.  A strategic default is where an owner has the ability to pay their mortgage, but elects not to because the value of the home is less than the mortgage amount owed to the lender.  This rule can also apply to those who don’t try in good faith to work out a payment plan, loan modification, etc. with their lender.

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