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: 578
Latest Activity: on Tuesday

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 London Cox on September 8, 2016 at 2:11pm

Johanna - 

Yes, I've run into this issue with the IRS on short sales on a number of occasions and have found them to be pretty cooperative in removing those liens.  As would be expected with dealings with the IRS, there is certainly some paperwork involved, as well as some turnaround time, but so long as it's clear that the property is being sold at a loss and the taxpayer isn't collecting any monies at close, they will usually remove the lien from title.

Here's a link to the IRS page detailing the process and with links to the internal publication that details how to go about it:


Hope this helps and good luck getting your deal approved and closed.


Comment by johnna lodge on September 8, 2016 at 1:48pm

Has anyone been able to move an IRS Tax Lien from the property to the individual? My seller that I am working with on a short sale has over a $20K tax lien that would make the sale of the property a little over market value. The HUD representative suggested this. Has anyone attempted or had success with the IRS removing the lien from the property and attaching to seller? Thank you. Johnna

Comment by Dean E Eshelman, CPA, CDPE, IRES on August 17, 2016 at 7:13pm

Luther Fisher -- Gross is Gross Pay before deduction - Pre-tax income

Comment by Luther Fisher on August 17, 2016 at 4:27pm

Have another Midland short sale. Question I have is, how do we show income on  the short sale application? it asks for 'gross' but is that just take home pay or do we show pre-tax income?


Comment by Brett Goldsmith on August 9, 2016 at 4:43pm

@luther On FHA loans when modifications are approved, many times HUD places partial claims ( silent subordinate liens non interest bearing ) for a portion/total amount of the delinquent dues.

Comment by Luther Fisher on August 9, 2016 at 4:30pm

the 1st mortgage is owned by midland mortgage, then are two loans to HUD itself, presumably for the missed payments. 

Comment by Luther Fisher on August 9, 2016 at 4:29pm

@brett...thanks! actually these are loans owed directly to HUD. the borrower did a few modifications and then hud put mortgages on the property for the missed payments...if I'm looking at this correctly. they have loan #'s on them too but it says the lender is HUD. 

Comment by Brett Goldsmith on August 7, 2016 at 5:29pm

@luther Partial Claims will need to be paid in full. The servicer should submit a variance to HUD to pay these in full. These partial claims often push the minimum NET below the 88/86/84% tiers of the ATP. The borrowers likely won't get any relocation incentive if that is the case.

[email protected]



Comment by Luther Fisher on August 7, 2016 at 2:50pm

I have a seller who has 3 HUD loans, these are loans that look to be directly from HUD. They did a few modifications over the years. Are they fairly easy to deal with?

Comment by Frank Biganski on June 21, 2016 at 5:33am

Thanks Brett. It's not free & clear but I'm having him pay for a title search to see if it's attached to his primary residence. I remember in 2008, it was attached as he borrowed $60,000 in equity from the land to purchase his primary home.  But he refinanced the FHA loan, and it appears the 2 are no longer attached (but again, not 100% sure which is why I having him pay for a title search).


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