FHA - HUD Short Sales


FHA - HUD Short Sales

HUD rules for FHA short sales, tips, experiences, etc.

Fax LOA:  918-236-3274

PH 877 622-8525

Members: 579
Latest Activity: Nov 2

FHA Preforeclosure Sale Guidelines


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7-9-13 Updated Pre-Foreclosure Sale (PFS) and Deed in Lieu (DIL) of Foreclosure - Effective 10-1-13.

FHA National Servicing Center 

(877) 622-8525 Customer Service

1-800-489-1733 Fax

1-866-808-5050 Fax for LOA


301 NW 6th Street, Suite 200
Oklahoma City, OK 73102
National Servicing Center:


Please note that effective October 1, 2014, Deval LLC will no longer be HUD's National Servicing  loan servicing contractor. The new contractor, Novad Management Consulting will be your new point of contact.


For all Customer Service questions please contact [email protected]

FHA Contract Clause

"Sale is contingent upon the seller receiving prior written approval of Insert Name of Lender/Servicer."

FHA Listing Agreement Clause

“Seller may cancel this agreement prior to the ending date
of the listing period without advance notice to the broker, and
without payment of a commission or any other consideration if
the property is conveyed to the mortgage insurer or the mortgage
holder.” The sale completion is subject to approval (under HUD
guidelines) by the mortgagee.


Discussion Forum

FHA short sale with Partial Claim

Started by Mike Rosania. Last reply by Jim Stewart Feb 21. 10 Replies

Reverse Mortgage with HELOC

Started by Lisa Jalufka. Last reply by Brett Goldsmith Jan 31. 1 Reply

61 Days in Marketing, HUD refuses to accept less than 88% net - FSD in 2 days

Started by Robin M. Willis. Last reply by Dean E Eshelman, CPA, CDPE, IRES Dec 12, 2016. 3 Replies

Comment Wall


You need to be a member of FHA - HUD Short Sales to add comments!

Comment by Kevin - Greenville, SC on April 13, 2016 at 1:16pm

So their current stance is so now they shoot themselves in their foot  because of the previous actions of the homeowner?

Comment by Kevin - Greenville, SC on April 13, 2016 at 1:14pm

A short sale is never over until the property is no longer in the seller's name. FHA has only two choices and they are foreclosure or short sale. the foreclosure historically nets them LESS than a short sale (this is taxpayer $). fight for it with everyone you can contact. the press, your state reps., etc., etc., etc.

Comment by Jason Sanseverino on April 13, 2016 at 1:08pm

Hi Dean  - thanks for your response. I was surprised that the ATP was issued - and I knew it was issued in error. Based on what I was told by HUD and Brett's response below - I believe this short sale is over.

Comment by Dean E Eshelman, CPA, CDPE, IRES on April 13, 2016 at 1:04pm

@jason. Just my opinion, but seems to me if the ATP was issued, that is an obligation to negotiate the short sale. Granted 10 years is a way long time and the reason why the homeower did not step forward sooner might be included in a statement. I certainly see why an extension of appraisal might be denied, but like I said they issued the ATP.

Comment by Jason Sanseverino on April 13, 2016 at 11:48am

Thanks Brett - Most of my FHA files are only 3-24 months past due. This is the 1st time I have encountered this.

I appreciate your response!

Comment by Brett Goldsmith on April 13, 2016 at 11:45am

@jason this is happening quite often now. I've seen it happen 3 times within the last 2 months. HUD is closing out short sales on extremely delinquent accounts. I believe it is 3years+

[email protected]



Comment by Jason Sanseverino on April 13, 2016 at 11:39am

I have a Wells Fargo FHA short sale where the loan is about 6 years past due. 
Our short sale package was processed with Wells Fargo - an Appraisal was completed - an ATP was issued (which was a surprise to me due to the delinquency) and we have an offer that's $20k above the ATP value.

Wells Fargo told me that HUD denied a variance to extend the appraisal (not sure why they needed an extension) and they shut down the short sale file - even though the ATP wasn't expired.   

I escalated this file with Novad and HUD. HUD notified me that they refuse to proceed with a short sale on this home due to the extreme delinquency on the loan.

In 10 years of processing short sale - I have never seen this occur.

Has anyone encountered this? Any suggestions?


Comment by Brenda Houghton on September 15, 2015 at 12:10pm

FHA PFS Allowable Fees

HOA fees are allowable fees to be paid from seller's proceeds per HUD Preforeclosure Sale rules. The sellers would also be required to use their $3000 incentive to pay a part of the HOA fees. The remaining amount HUD will pay is completely dependent upon the minimum net required in the Approval to Participate letter, as Brett said. The key to making this deal work is to negotiate with the HOA to get them to reduce the amount owed.

Comment by Brett Goldsmith on September 15, 2015 at 11:41am

@bill it depends likely on what the NET to the mortgage servicer is if the note is HUD backed.  If it's below 88% they may not contribute to the delinquent HOA Dues unless if it's a lien. Has the HOA placed a lien on the property? If it's not a lien and it exceeds 88% they may contribute towards the delinquent HOA dues. It's not so cut and dry for these type of scenarios unless if it's a lien it would likely be $1,500...

I hope this helps and call me anytime at 888 559 5956.

[email protected]



Comment by Bill Garrett on September 15, 2015 at 11:33am

CONDO DUES & FEES.  I have an FHA seller who owes $20,000 to the condo association, accumulated over several years in unpaid dues and fees.  How much of that can we expect the SS lender/FHA/HUD to cover?  Thanks.


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