This is my first time working with the relocation incentive...  where is the $3,000 relocation incentive placed on a HUD, or is it placed on the HUD?  The closing agent entered it on lines 209 and 509 as a seller paid closing cost, but that doesn't look correct to me because it doesn't financially benefit the seller.



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Section 500: BofA/Fannie Co-Op Program Seller Incentive Payable to Sellers.......................$3,000

Line 603 = $0

It is not a closing cost credit for the buyer, it is a payment made to the seller from the proceeds

Yes, this is correct, the Coop is made, because the property is a Fannie Mae property but the Seller doesn't qualify for HAFA, and because it is Fannie Mae, it doesn't qualify for Streamline Short Sale, therefore, the Coop exists, all that being said, Fannie Mae offers the seller $3000 relocation incentive to move forward with the short sale.  Since it is a short sale, EVERY Financial ITEM MUST BE on the HUD, showing who is getting what, DISCLOSURE, DISCLOSURE... Disclosing the Buyers items, the seller's financial institutions Net, and the Sellers actual payment.  It is correct and legal.  Now, as far as where they go on the HUD, usually the Coop-Short Sale Institution will tell you where they want it on the HUD.  Generally, on the same line, but they could vary a bit.  

I would place it in the 1300 areas as this is where the lenders asks that the FHA incentive paid to the seller also the VA relocation assistance to be placed in the same area is the way I have been doing this for 5 years now.

This is something that title can handle.  Once you receive confirmation from the bank on the incentive send a copy to title and ask them to add it to the HUD.  It definitely needs to be on the HUD...  Title should be familiar with this though.  Hope this helps...

What we call the Relocation Incentive from BofA - of $3,000  -as required by them in a deal I just closed on April. 29th, 2012 This amount was required to show under Line 509 and should read. "Cooperative Short Sale Incentive" .


However might not necessary be 509 for every client - but must be in the First page of HUD under reductions in amount to sellers

and this amount is computed buy them as expenses deducted to reach their "net to the investor amount required"



Thanks a lot Magda!  This was exactly the answer I was looking for!  As Michael stated, I know the credit has to be placed in the 500 section as per RESPA and U.S. Treasury Guidelines but I couldn't find any add'l info on the Internet as to exactly which line.   Long story short, the closing agent we are working with has closed short sale before, but never one of these BofA incentives.

Thanks to everyone -- much appreciated!


It depends on you negotiator/closer. Some will want it on page 2 in the 1300s others will require it to be in the 500 section page 1. Submit the preliminary HUD and the negotiator/closer will correct for their preference.

I dont have an answer for you, but do have a question. I have an offer that covers the first with ING, and enough for all cost, etc. and still more, but not enough to pay off the second with B of A, the owner could just walk and let ING have property and B of A gets nothing, I was going to approach B of A see if they would allow the seller to have some incentive (money) to not let it go back to ING and give B of A, 40K on a 160K 2nd.  Any experience with this type of situation?  Thanks for any insight'

Diane Campos



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