FHA Short Sale DENIED due to rental period
I am trying to sell a home in AZ that I left in 2009 when I moved back to PA. When I first left the house it was on the market, but I got zero hits, so I began renting it to help cover the mortgage. Just a few months ago I received a Short Sale offer on the home and submitted everything required to Wells Fargo. Yesterday I was told that the short sale was denied by HUD because I rented for more than 18 months. Yes, I understand that generally that is the rule, however, two variances were filed on my behalf by my realtor to appeal their decision. Both were denied and now he is being told he cannot file another variance.
The offer I have is a preapproved VA loan, and the buyer is paying fair market value for the home. If anyone can offer any advice on how to proceed PLEASE let me know! Thank you for your time!
Replies to This Discussion
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Permalink Reply by Kevin - Greenville, SC on
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In most cases HUD approves these without issue (especially if there is no Foreclosure Sale Date). I would check with HUD to determine if a variance was actually submitted an ask them for an explanation if they did indeed deny.
Both were denied and now he is being told he cannot file another variance. - HUD has no such rule.
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Permalink Reply by Smitty on
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What is your hardship? I certainly understand the 18 month timeline, but I think they are even more strict on moving unless there was a true hardship meaning, you lost your job and had to move for another.
I agree with Kevin. I am not aware of any rule that states you cannot file another variance. I also would ask for the reason why it was denied.
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Permalink Reply by Bob S on
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When I spoke with HUD today at the National Servicing Center they were surprised that it didn't go through as well. They advised me to contact Wells Fargo again and see if I could submit a variance myself. I attempted to do that, but my Home Preservation Specialist declined to respond to the many many voicemails I have left for him, so I began speaking with other people at the bank. I was told that the FHA department for Wells Fargo was the group that declined it, not HUD. When I worked my way up to different supervisors they all told me that they had followed the guidelines and I was not eligible for a short sale OR a deed in lieu of foreclosure simply because I rented the property out for more than 18 months. Two variances were filed but were quickly denied--again, their explanation was that the guidelines set out by HUD were followed.
I called HUD back and they opened a ticket to investigate to see what happens. I'm glad something is happening, but I'm not going to be surprised if it doesn't come back in my favor, even though I've found many examples of people in extremely similar situations getting to push their short sale through.
Smitty, as for the original reason we moved--I took another job 2,500 miles away.
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