USDA Rural Housing Loans


USDA Rural Housing Loans

Here's information to help with USDA short sales

Members: 36
Latest Activity: Apr 30

USDA Short Sale Information


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These loans are handled through the servicer. Just check to see how they are handling the submission.

In order for a loan to be considered for a pre-foreclosure sale, the loan

must be in default (delinquent) for more than 30 days at the time the

pre-foreclosure sale is closed.


Agency pre-approval is required for non-occupant borrowers

when it is verified that the need to vacate is related to the cause

of the default (job loss, transfer, divorce, death).


PFS is not available to borrowers who have abandoned their

mortgage obligation despite their continued ability to pay.


****Properties that have sustained serious damage (from fire, flood,

earthquake, tornado, or other man made or natural disasters) should

not be considered for PFS if the cost of repair exceeds 10 percent of

the As Repaired appraised value.


The documentation requirements for a pre-foreclosure sale differ

depending on the type of borrower.


Employee in a private or public organization

  • Letter from borrower outlining failure to pay/hardship

  • Current pay-stub

  • BPO/appraisal

  • Sales contract/HUD-1 Settlement Statement, and

  • Credit report.


Self Employed

  • Year-to-date profit and loss statement

  • Previous year’s profit and loss statement, and

  • Previous year’s signed tax return.


USDA PFS Guidelines.pdf 

Here's a link if you need to locate a local office.

 USDA Value Dispute Form.pdf

USDA Loss Mit Guide.pdf


BofA USDA SS Packet.pdf

USDA Is a Tough Collector When Mortgages Go Bad

Discussion Forum

Help with USDA short sale - need contact

Started by Glenda Sher. Last reply by Carrie Fairman Feb 24. 5 Replies

Does anyone have any ideas on how to escalate a file that was denied by USDA?Serviced by Chase. Chase says investor denied due to borrower lack of hardship. Totally ridiculous.  They refused her many…Continue

USDA contact info to expedite

Started by Sara Senet Feb 19, 2014. 0 Replies

The servicer, M&T bank, submitted our full value offer to USDA on 12/16 for approval.  They are saying that USDA is behind and not yet responding and they don't have any direct contact…Continue


Started by Jon Batten. Last reply by Jon Batten Oct 21, 2013. 6 Replies

I just got a SS Listing. The load is USDA through B of A. They buyer has tried modification three times the first two were turned down. The third was taking so long that he gave up waiting and…Continue

USDA direct - no servicer

Started by Eric S. Garrison Waterboro, ME Apr 4, 2013. 0 Replies

looking for some help with a USDA direct loan - no servicer (buyer side) anyone with experience please hit me up in my email. Thanks in advance for any and all help :)…Continue

Comment Wall


You need to be a member of USDA Rural Housing Loans to add comments!

Comment by Bill Garrett on August 28, 2014 at 5:31pm


Is it necessary to have a buyer's offer to begin the USDA short sale process?  Or, is there a retention/waterfall review similar to an FHA mortgage?  Thanks

Comment by Jeff Struchen on August 7, 2014 at 1:08pm

I have seen any posts or responses on this group for quite some time. I have an issue with BofA on a USDA loan. Seller has been through BK and included note in BK. BK discharged over 1 yr ago. BofA insists that seller MUST provide full financial disclosure to qualify for SS. Anyone have contact for USDA to verify this? 

Comment by Karen Mordus on October 14, 2013 at 6:10pm

I need help with my WF USDA loan.  Yet another one of my WF loans is over appraised again!  I'm getting very tired of this over appraised game their playing, this is the second home I may lose to a DIL.  My poor clients!!

WF negotiator said I can appeal the comps, however I can only go 1 mile out and under 6 months of STL comps. ?  What ever happened to 12 months of settled comps? Has USDA changed their guidelines? If there are no other comps, what then? I need to go 2 miles out to get any reasonable close comps.  My negotiator said "no way"!  This property is only valued at $90k, I have a solid offer of $95k. WF has appraised it at $130k. I've spoken with each of the buyer's agent's on their appraisal and each property has been move in ready, with upgrades. My property has holes in walls, water damage, no appliances (zero!) and the a/c does not work.  Oh the kicker....the appraiser is the same guy WF used on my last client (DIL)

Anyone had this happen before? Any advice on how I can handle this? Right now I have no recourse but list the property at their $130k, let it sit for 60 days and then USDA will allow my seller to the option of a DIL.

Comment by Linda Cadotte on July 2, 2013 at 9:34pm

I have a USDA loan that made it through US Bank finally.  Now it has been with USDA for approval for about 3  weeks.  Any one know who I can call with USDA to get it moving?  thx!

Comment by Bill Garrett on March 5, 2012 at 5:22pm

I have a Chase SS approval on a USDA loan.  The approval letter is silent on the deficiency issue. The negotiator says USDA does not pursue the deficiency (similar to FHA policy) but that USDA will not confirm in the approval letter that they will not pursue the deficiency.


I suspect this is accurate information but would like to see some authority beyond the well-intentioned negotiator's explanation.  I have looked online (, etc.) but can't put my hands on any applicable policy statement.  I figure someone like Kevin Lancaster or Michael Schneider has this info at their finger tips.  Any help would be apppreciated. Thanks.


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