FHA - HUD Short Sales


FHA - HUD Short Sales

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

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Members: 548
Latest Activity: Apr 17

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 

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National Servicing Center:

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

2nd denial based on value - Wells Fargo Fannie Mae

Started by Maria Strong. Last reply by Brenda L Wood Apr 17. 18 Replies

Variance Requests

Started by Anthony and Christi Jensen. Last reply by Elizabeth Monje Apr 8. 9 Replies

FHA short sale with Partial Claim

Started by Mike Rosania. Last reply by Mo Myers Apr 2. 9 Replies

Comment Wall


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Comment by Kathleen Sheridan on March 4, 2014 at 1:17pm

Comment by Jeff Payne on March 4, 2014 at 12:53pm

Kathleen what would raise the closing costs needed so much?  

Comment by Kathleen Sheridan on March 4, 2014 at 8:48am

@Jeff Payne, where you sell real estate 4% might be more than enough. 6% is typical in Philadelphia where it isn't quite enough. 

Comment by Jeff Payne on March 3, 2014 at 10:14am

@Beth, why would a buyer need 6% for closing costs?  They may want to speak to a different lender.  4% is more than enough for normal financing

Comment by Frederick Paul Tazartes on March 1, 2014 at 5:40pm

I need some help, I have a FHA loan, the borrower's mother is in need of medical care and lives out of state, the borrower is going to relocate to take care of her mother. OCWEN/GMAC is the lender and they say they need to follow FHA protocol and exhaust all retention options before they can proceed with the short sale. I explained to them this is not a financial issue and a loan mod is not going to help the situation, they said talk to HUD, I call HUD and they said the variance needs to come from the lender.

Where should I go next?

Comment by Guerry Clegg on March 1, 2014 at 12:41pm

Thanks for clarifying.

Comment by Kevin - Greenville, SC on March 1, 2014 at 12:38pm

any buyers loan 's eligible as long as FHA approves a variance.

Comment by Guerry Clegg on March 1, 2014 at 12:31pm

I agree that 6 percent is doubtful. I did not know they could get 3 pct. All I've known is the specific allowable costs plus 1 pct for FHA buyers, which is not the case here. Some negotiators interpret that to mean you have to be an FHA buyer to get the allowable costs, but I confirmed with HUD rep last week that anyone is eligible for the allowable costs.

Comment by Kevin - Greenville, SC on March 1, 2014 at 10:17am

you'll get 3% (regardless of the type of loan buyer is obtaining) of the purchase price in selling paid closing costs with an approved variance almost always from FHA when the net is being met.  6% is doubtful..

Comment by Beth Daubert on March 1, 2014 at 10:13am

Can anyone offer advise or based on recent experience- I have an FHA preforeclosure with a 100% of appraised value offer from a USDA buyer who needs 6% seller assist. On HUD website, it states it will provide 1% assist for an FHA buyer. No comment on site regarding other loan products.

M&T negotiator says he'll check on it. I called FHA direct as well- no response back yet. Sale hinges on the assistance.


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