Getting short sale approved after being declined??

So I just had a short sale declined from Fannie through BOA because the homeowner is current and they do not see an imminent hardship to approve the short sale while current.

 

Not that it is typical on a short sale for the homeowner to be current there are situations where a homeowner is shorting for hardships other than financial such as a mandatory job transfer etc etc. Guidelines do allow for approval while current under some circumstances... just closed one last week.  Typically, a servicer will come to me upfront and state that the homeowner will be required to go behind if it cannot be approved current.  With BOA they are sending it all the way through and letting the investor decline it.

 

So my question is this... since BOA is sending it all the way through and letting the investor decline it I am wondering if that lessons the opportunity for success should the seller go behind and the file be resubmitted.

 

Any similar experiences... opinions?

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Permalink Reply by Smitty on August 29, 2011 at 2:08pm

You can absolutely have a short sale be approved after it has been declined, however they will look at what circumstances changed most likely.   I had a WF short sale not get out of the gate FOUR TIMES because the homeowner was current, but finally got someone who I could escalate it to that knew something and low and behold it got approved and the homeowners were current.

 

The problem is they MAY look at it like a strategic default.  I NEVER tell a homeowner to default.  I give them the information from the bank and let them decide what to do.  You could get a whole new set of people the second time around with a different outcome, or the very same people who will say "Didn't we just deny this for being current?  Now suddenly the homeowner isn't current?"

 

I'm not trying to discourage you, but merely show you they may question WHY suddenly the homeowner is defaulting.

Permalink Reply by Lorie Gould on August 30, 2011 at 2:45am

Thanks Smitty,  In our original request we did present a case that the homeowner would not be able to stay current once he moved due to the changes in his family and required move.  Had the homeowner been 30 days late BOA would have been able to issue the approval letter; however, because he was not late it had to go to the investor for approval.

 

I never tell a homeowner to default which is why if there is just cause I will take a short sale current here and there only if there is good reason for the move... meaning not a strategic default.

 

Would you mind sharing the time table of your WF that went through 4 times?  Did you immediately re-enter the gates or did you allow some time to pass?

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