Underwater? You can flee your home - FOX 13 News

Underwater? You can flee your home

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TAMPA (FOX 13) -

There could be some help on the way for homeowners who owe more than their home is worth.

New rules go into effect March 1, and some will be calling it liberation day. Some homeowners who are underwater may be able to walk away from their homes and cancel their debts.

It's great news for a lot of people, but know this: There are rules, and they don't apply to everyone.

As of March 1, Fannie Mae and Freddie Mac will start allowing some homeowners to get out of their homes, although this is not a free pass for people who want to escape an underwater mortgage.

Housing experts say people that walk away from a home never come out ahead, but this will be a new option for many.

Here's how to know if the new rules apply to you: You must either be current or less than 90 days late on your mortgage payments. You must also be able to prove your "hardship." The house must be cleaned and not damaged.

And often homeowners will have to surrender 20 percent of their personal assets as well.

This is ideal for people who want to take a job in a new city, suffer the death of a spouse or relocate for the military, experts say. Right now, there's no estimate to how many homeowners may qualify for the deal.

About 22 percent of homes in the country were considered underwater at the end of the third quarter.

The worst hit states: Florida, Nevada, Arizona, Georgia and Michigan.

LINK: Read the rules on the deal - http://www.freddiemac.com/sell/guide/bulletins/pdf/bll1227.pdf

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