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Approved Wells Fargo Short Sale with limited HOA payment

Posted by Kathy Becklin on March 15, 2011 at 2:15pm in Short Sale Discussions

Aloha,

This morning I received an approval for a short sale.  Unfortunately the letter stated "The maximum FNMA will contribute to the HOA 6% or 6k of the balalance, whichever is less."  Estimated HOA payments are $5518.65 and they took exactly 6% or $331.11 off.    Has anyone else seen this?

So who can legally pay the difference?  I might be able to get the HOA to waive the late fees and possibly some of the fees but not in the short close period of 14 days we have.  If buyer agrees to pay, then WF could come back and say that purchase price is actually higher and they want some of that pie (as I've read about in forums).  How would you record on the HUD who is paying? 


I'm worried that we have a great cash buyer, great offer that isn't going to get approved.

Any recommendations?

Thanks, Kathy

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Tags: FNMA, Fargo, HOA, Wells
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Replies

  • Ellen Kirwan March 20, 2011 at 4:49am
    The buyers should always be advised at the beginning of a short sale that there are items the lender may not pay and will, by default, become the buyer's responsibility.  I have not see the 6% or $6,000.  Sounds like HAFA 2nd.  It is perfectly fine for the buyer to pay the delinquent HOA and good for you to try to negotiate it down.  It goes on the buyers side of the HUD so the lender will have no problem with it. 
  • Bryant Tutas March 16, 2011 at 1:18am
    Kathy. As you mentioned you can negotiate with the HOA to reduce the amount owed. Or the buyer or seller can pay the difference. Just place it on the HUD as an expense. It does NOT affect the purchase price. if it's on the buyer side then of course their lender (if one) will have to be OK with it. If on the seller side then the HUD will show the seller bringing cash to close. It could also be on the HUD as  POC item. I wouldn't even ask the lender this. Just do it and send the HUD over for approval.
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