can citi foreclosure on Fannie Mae loan?

[tsam9]

I have question, usually people believe bank won’t prefer to foreclose houses due to the home equity and future sale price may not even cover the loan balance along with unpaid interest and legal expenses. My problem is I do have hardship and I also have equity on my house which I believe enough to cover the fees if bank do a foreclosure on me.
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Mine is Fannie Mae loan, and I am in foreclosure process. Can you please tell me lenders do foreclosure on gov backed loan too? Can they do that? I already resubmit my package and waiting to be reviewed again, I truly hope they can approve me. I have always live within my means, saved enough money to put down a huge down payment, now this equity that I have saved just came back to hunt me, what a world!
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My 1st with citi @2467.00 + tax and insurance at $3166 total. My gross is $7800. so is 40%. With my 420k loan @ 2% is 1480 , if using 31% of my gross, then the payment should be $2148 , deduct tax and insurance, I still have 1718 to pay citi. Why are they just rejected me and rather foreclosure my house? Even with equity, but today’s market is bad for selling a house, why the banks do that, really doesn’t make sense to me.
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isn't it Fannie mae need to work with us to help? How can they just initiate the foreclosure ? now , I am waiting for a sale date.

[Evan Bedard]

Hi tsam9 welcome and thank you for joining the forum.

Even though your loan is gov't backed there is still a possibility of foreclosure. Not every loan will be approved for a modification, even if you feel you qualify for the program.. I would sugges to follow up every few days until your modification is complete.. How many months behind are you?

[tsam9]

I'm 8 months behind and already received the notice of foreclosure in mail. My workable sloution package is still under review, but I have a bad feeling about it. Beacse I did a NPV test myself which the result is "consider short sale".

1st+tax+ins = 2467+650+50=$3167 @ 40%
my gross is $7800. with a surplus of $100 per month. I got a job recently, all my savings are gone. now my only hope is the mod to keep my house with my two boys.