Effective November 1, 2012 new short sale guidelines will go into effect for Fannie Mae and Freddie Mac backed mortgages.

Among the new guidelines, home owners will be able to sell their home in a short sale even if they are current on their mortgage, assuming they can prove a hardship. Eligible hardships often include death of a borrower or co-borrower, divorce, disability, or job relocation (such as a job transfer or new employment 50 miles away from their current home).The new FHFA guidelines also permit mortgage servicers to speed up the processing of short sales for borrowers with eligible hardships without needing additional approval from Fannie Mae or Freddie Mac.

Other points worth noting are:

— Military service members who are being relocated will automatically be eligible for short sales, even if they are current on their mortgages.

— Fannie Mae and Freddie Mac will waive the right to pursue deficiency judgments for borrowers who short sale who have sufficient income or assets and can make a financial contribution or sign a promissory note.

— Freddie Mac and Fannie Mae will offer up to $6,000 to second lien holders in order to quicken the pace of a short sale.