My client now thinks I amÂ a Jedi Warrior....a Ninja!Â She is singing my praises because we just got a Trustee Sale extended on her home and yesterday, Midland Mortgage, was telling us there was no way that was going to happen.Â This is the second month in a row we received this response from Midland MortgageÂ and that came directly from a Supervisor in the Short Sale department!! If I listened toÂ Midland Mortgage the first or second time, I would have lost a sale and my client would now have a foreclosure on her credit.
What'sÂ my secret, you ask? Believe it or not, it's a government sponsored entity (WOW, I Know!) called the Department of Housing and Urban Development.Â A/K/A "HUD".Â They have been extremely helpful with my last few FHA short sales, and this one is no exception. HUD can beÂ a greatÂ resource if you need to perform a short sale on an FHA-backed mortgage.Â This short saleÂ was denied by Midland Mortgage, but HUD got it reopened and got it approved!!! This is information that any agent who deals with FHA-backed mortgages needs in their toolbox. If I had not been working with HUD, this deal would have been D.O.A., and I would not have gotten an extension and be on our way to a Short Sale approval.
You see, the servicer/lienholder/lender (in this case, Midland Mortgage) could care less if an FHA loan forecloses. They are reimbursed by HUD.Â Thus, HUD is more helpful and compassionate when it comes to borrowers in default. HUD is also a lot easier to work with, and they try to make a short sale work to benefit all involved. In a lot of cases, banks are so overwhelmed that the negotiator may see closing the file as an easy out, or they simply may not see the file from HUD's point of view. After all, they are following HUD's guidelines, so why not work with the source, as well as the bank?
By following HUD's Pre Foreclosure Sale procedures and time frames, a mortgagee (a/k/a bank, lienholder, etc.)Â may submit an FHA insurance claim and be compensated for the difference between the sale proceeds and the amount owed on the mortgage (including accrued interest and reimbursable costs).Â The overwhelming majority of the time, however, banks deny short sales that are FHA-backed because they are fearful that HUD won't pay their insurance claim because they didn't follow the procedure properly or adhere to the time frames. But, if it forecloses, they automatically get paid.
Despite this fact there are special exceptions (please reference the guide again) where the bank may be afraid to grant an approval,Â HUD will grant the approval. In one very crucial way, HUD is just like the banks; the less real estate they own the, easy their lives are. I have now had several denied claims that HUD opened back up and got approved. Working with HUD from the beginning can save you a lot of headache and strife. This is just one tip of many to make your life easier when it comes to FHA short sales. Remember, even though they seem daunting, short sales can be conquered, and everyone can learn how to be successful at them.
Agents and sellersÂ need to familiarize themselves with HUD guidelines. (Click here for a copy, and link to their loss mitigation department...)Working directly with HUD, as well as the bank involved, can give you a better chance at a successful outcome when performing a short sale. This can also ensure that the bank follows all rules (most of the time they don't, like the fact that you do NOT need an offer to getÂ a HUD/FHAÂ short sale started) and can ensure that your commission does not get cut. When you have a short sale that is an FHA-backed mortgage, contact HUD as soon as you begin the process, so that you are working with them and the bank simultaneously.
You must get approval to participate in the HUD Pre-Foreclosure Sale Program in advance & upon acceptance into the program, you will be given Approval To Participate FormÂ which will outline program restrictions.
Here are details of the HUD Short Sale (Pre-Foreclosure) Sale Program.Â Remember, these guidelines apply to FHA-insured loans only, and there may be some latitude in those requirements.Â These guidelines are subject to change.
For more information contact the HUD National Servicing Center, your lender, and an experienced Short Sale Specialist.
Mortgagors who successfully sell to a third party within the required time may receive a cash consideration of up to $1,000. Mortgagees/Sellers also receive a $1,000 incentive for successfully avoiding the foreclosure and complying with all the requirements of the pre-foreclosure sale program.
Seems like a bit of a no brainer, don't you think? I now LOVE FHA Short Sales and you should too!Â
Do NOT be foreclosed on! Avoid foreclosure. The Bank Pays us to Short Sell your Home.
Want to find out more? www.shortsalemyphoenixhome.com
Jessica Sulliman & Randy Curnutt
About the Author...
ThisÂ articleÂ Â was provided by Jessica Sulliman, a Nationally recognized Realtor and Certified Short Sale & REO Specialist.Â Jessica can be reached via e-mail at firstname.lastname@example.org by cell phone or text message at 602-677-7977. Jessica has helped thousands of people buy and sell their home.Â For Arizona real estate and homes see www.sunshinespecialists.comÂ or www.jessicasshortsales.com. For more info regarding short selling your home, please visit www.shortsalemyphoenixhome.com.
Specializing in the following Metro Phoenix areas in Arizona:Â Queen Creek, Gilbert, Chandler, Mesa, Scottsdale, Apache Junction, Gold Canyon, Tempe, Florence, San Tan Valley, Coolidge, Casa Grande, Eloy, Maricopa, Ahwatukee, Anthem at Merrill Ranch resort community in Florence AZ.
Check out my blog: http://jsulliman.activerain.com Â Â