Replies to This Discussion

Permalink Reply by Margaret C. Taylor on March 21, 2011 at 12:58pm

Darrell thanks for giving your input  it is good to know, from your side of the fence, that a variance of even 3-6% will be considered if the Sales Price is sufficient.

Permalink Reply by Barbara Thomas on April 2, 2011 at 10:24am

I have had success with getting more than 1% of the purchase price toward Buyer's closing costs paid.  In one case, the Buyer was obtaining a USDA loan.  We got approval for 4.3% to the Buyer's closing costs (this was Wells Fargo).  In another case (this time the Buyer was getting FHA financing), we got 3.1% (this was Citi).  I have found that I have generally needed to specifically ask the Negotiator to request a variance from HUD.

Permalink Reply by Jo Soss on April 11, 2011 at 7:41am

Just an update on my file - Today we received the approval of the buyer's request to receive 3% towards their closing costs.  I am very excited!  We are now on to closing!  The process was very simple and only took 10 business days from the date we sent in the est HUD1 to B of A - have to say B of A has been amazing in this transaction.

Permalink Reply by Jo Soss on May 9, 2011 at 4:41am

Darrell, I just sent you an email with a question - thank you

 

Permalink Reply by Paola Martinsen on May 20, 2011 at 3:42pm

I haven't personally had to request a variance for the closing costs. However, I was advised that if they approve the variance for the 3% when the buyer is going FHA, the purchase price must be at full appraised value.

Permalink Reply by Norene M Rogers on July 13, 2011 at 8:35am

Does HUD require that I provide an est HUD1 with all the buyers fees.  How can I since escrow does not have the Escrow Instructions from the buyers Lender.  Do we just guess on the fees?  HELP Please

Darrell Powell said:

Since I work for HUD in the National Servicing Center and I approve and deny variances I wanted to give my input.  It is correct that per Mortgagee Letter 2008-43 HUD will pay up to 1% of the buyers closing cost as long as the buyer has FHA financing.  While there is no written rule or guideline HUD has approved variances of up to 6% buyer concessions regardless of financing type, when this happens the buyer is usually financing his closing cost and HUD is netting well in excess of 88%.  It is very common that HUD approves 3% concessions for buyers, again regardless of their type of financing, but the key is HUD has never approved concessions for a non-FHA financed buyer where the net is not at least 84%.  Every case is reviewed independently and my statements here do not guarantee or imply that every buyer will be approved for concessions not to exceed 6% if HUD is netting 84%.  If anyone ever has any questions please feel free to email me, [email protected].  If you have the FHA case number that is what I really need or the complete property address, HUD cannot search by a lender/servicer loan number.

Permalink Reply by Paola Martinsen on July 15, 2011 at 8:09am

Yes, just had 3% approved today through a variance must be full appraised value and meeting their min net 88% in this case since this was the first 30 days of the marketing period of the ATP.

Permalink Reply by Norene M Rogers on July 15, 2011 at 8:29am

Did you need to provide the Lender with a HUD1 showing all of the buyers costs?

Norene

Paola Martinsen said:

Yes, just had 3% approved today through a variance must be full appraised value and meeting their min net 88% in this case since this was the first 30 days of the marketing period of the ATP.

Permalink Reply by Paola Martinsen on July 15, 2011 at 8:32am

No, i didnt have to. I just provided seller side HUD. But for final approval on FHA short sales they usually do want to see both sides, once we have docs. I have had Wells request both sides prior to approving so we had to get a GFE from buyers lender but thats only happened to me once.

Permalink Reply by Norene M Rogers on July 15, 2011 at 8:33am

Too funny... B of A told me it is HUD's requirement to submi the variance with a HUD1 showing all of the buyers closing costs.  I though they were pulling my leg AGAIN :-)

Thank you

Permalink Reply by Paola Martinsen on July 15, 2011 at 8:37am

Here is my take on that: HUD has guidelines but every servicer interprets them differently and enforces them differently. For any questions about the proper guidelines I always contact HUDS servicing center and if what the servicer is requesting is impossible to get or they are taking too long then I get HUD involved to enforce the correct guideline/procedure. The guideline is the same but the servicer is the one that is inconsistent.

Norene M Rogers said:

Too funny... B of A told me it is HUD's requirement to submi the variance with a HUD1 showing all of the buyers closing costs.  I though they were pulling my leg AGAIN :-)

Thank you

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