Good morning!
We received an offer from the lender today that approves my seller for HAFA provided that she pay $2,200 outside of closing to the mortgage insurance company. The catch is that the $2,200 would have to be paid BEFORE the lender can issue the HAFA approval. Paying it at closing is not an option for IndyMac.
The seller is hesitant to pay the contribution prior to closing because of the risk that the deal could fall apart and I'm concerned that the lender might not issue a HAFA approval after the contribution is made, regardless of the correspondence we've received from them.
Has anyone else come across this? Ideas?
Alex Krumm
Re/Max Alliance Group
Broker Associate
GRI, Certified Distressed Property Expert
Winner, Five Star® Best In Customer Satisfaction: 2010, 2011, 2012
941-234-3597 Direct
941-954-5454 Office
941-444-2552 Fax
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This is a bewildering situation. All I know is, I wouldn't do anything without having your client consult an attorney and getting their proposal in writing. Its crazy that they want this outside of closing which means to me that they aren't allowed to do this so they are keeping out of sight. I had one where the mortgage insurance company made the seller contribute a portion of their HAFA incentive but it was all on the HUD. It was hard to swallow, but the short sale got done and was all on the HUD. Also, on the approval letter.
Cash Contributions are not allowed with a HAFA SS.
https://www.indymacmortgageservices.com/uploadedFiles/IndyMac/Manag...
Understood - the argument from the MI company is that the seller needs to contribute $2,200 outside of closing and BEFORE the lender issues the HAFA approval. If the seller refuses, the MI company won't approve and the file will have to go through the regular short sale process (at which time, presumably, the MI company would ask for the contribution again - thereby risking the HAFA benefits and putting a 2012 closing at risk).
I would escalate the issue to Treasury.
http://www.realtor.org/topics/home-affordable-foreclosure-alternati...