Hey All,
I am taking on a new short sale and the seller not only is in Foreclosure but they currently have personal liens (credit card judgements). Will I have trouble getting Short Sale Approval has anyone encountered a similar problem?
Thank you,
Herb
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Include the credit card judements in the HUD1 with the actual lien from title. I just closed one where the seller had two tax liens and the lender allowed them to be paid out of the proceeds. I sure it will depend on the amount of money owed and the net to the bank.
FHA has specific rules on how much is allowed toward subordinate lien holders up to $2500 MAX, but sometimes more is allowed with a variance request from HUD just as long as you are still meeting the minimum net proceeds required. Other parties (buyer, seller, etc.) can contribute to settle subordinate liens as well with the FHA PFS Program.
Thanks for the reponses everyone, the customer service rep. made mention that they would automatically deny the short sale as a consequence of having these creditr card judgements on file. Is this true? Or did I just run into someone with incorrect information??
Speak with somebody else until you get the answer you need.
Just received an Approval on a FHA PFS where the Purchaser is paying $6500 towards subordinate lien holders and Wells Fargo kicking in another $5500.
This was not done without Wells Fargo kicking a screaming for a couple of months as I have to overcome a high appraisal too.
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