Has Anyone closed a VA Compromise sale where the net is less than the 88%?? Wells Fargo VA Short Sale

I'm posting this ? as Sylivia brought in up and I am curious to the answer as well.

Q: is the required 88% net of the VA appraisal set in stone or has anyone ever closed a VA Compromise sale where the net is less than the 88%? If so, at how much lower was it accepted?Comment by Sylvia Noble on November 18, 2010 http://shortsalesuperstars.com/group/VAshortsales

I personally have 1 with Wells Fargo and as anyone who watches the market here knows it is not recovering and comps seem to be slower closing and going down in many areas, creating an issue with closing on the 88% Net of the appraisal is crazy for a Las Vegas Short Sale !

I read thru some of the guide info posted by: Nicole F

the SLMP guide here: www.vba.va.gov/ro/roanoke/rlc/forms/SLMPGuide.pdf You might also want to look up the VA Loan servicer guide (rev. Jul 2009) to better understand VA's loan servicing guidelines http://www.benefits.va.gov/homeloans/docs/va_servicer_guide.pdf

and noticed it states something to the effect that VA may consider less & I also noted this...

If a servicer disapproves a request, or, if at any time, VA finds it necessary

to take over the processing of the case due to the servicer's failure to pursue

the alternative in a prudent and expeditious manner, no servicing fee will be

payable.

So, 2nd ? is has anyone had the VA take the process over?

Yes, definately tough, I also noticed VA can lower the VA appraisal to last No less than 90 days in some circumstances, this may end up being 1 of those times.

I've also noticed that on several of recent VA appraisals here, they seem to be coming in a bit higher than would be expected in our market and have confirmed this with other agents here too. Seems they don't give as much weight to "on market homes".

Wendy Rulnick said:

OH I see - contesting the appraisal - tough one!

Dawn Barrier SFR®,CSP®,HRC said:
Wendy,

It seems the VA appraised Value is based on a 3 month old comp about $15K higher than where it should be based on their 88% calculation. And we have No unnessary closing costs and even ran #'s with a lower commiss. & still off about $7,000.

Wendy Rulnick said:

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.

Replies

Kevin - Greenville, SC March 17, 2012 at 2:29pm

Kevin

We can present this information to our internal SAR group; since the NOV is pending review. If the information presented does not change the value of the property, then we will still have the ability to present to our VA tech for signoff if it’s under the minimum net. We just need to keep in mind that until the BK consent is obtained, the liquidation group can only monitor for progression within the other departments.

Thank you,

Bill Bieber

AVP - Liquidation Portfolio
Marsha Umansky August 15, 2011 at 4:41pm

OMG! Thank you All on this thread. I did not know about the 88% rule. It may help me save my VA Citi short... CITI approved $205,000 (pay-off $187,497). But Buyer's FHA Appraisal came at $202,000 (new pay-off - $184,131). The negotiator is not answering (what's new). Finally got to talk to the file manager (?) who told me their appraisal (VA) came at $209,000 and "no VA would not accept anything lower than the originally approved $187,497".

If the 88% rule is still correct, our currently proposed pay-off is within the VA guidelines! Just wrote an e-mail back to CITI ... will see what happens...
Michael D. Schade February 7, 2011 at 6:08am

Had a VA short sale late last year with Citi Bank, and it was 88% of the VA appraisal,which is standard according to the negotiator, with no exceptions.
Kevin - Greenville, SC January 31, 2011 at 5:07pm

The VA liquidation appraisal was completed on a property I have listed on 8-5-10, although it has not been six months Wells Fargo and the VA says it expires 1-31-11....
Dawn Barrier eXp Realty Vegas January 11, 2011 at 11:50am

Well, solution is get buyer to pay more and bring offer up to what the lender wants & if there is an issue buyer would have to bring in difference if they want the home.
Dawn Barrier eXp Realty Vegas January 5, 2011 at 12:08pm

Yes, definately tough, I also noticed VA can lower the VA appraisal to last No less than 90 days in some circumstances, this may end up being 1 of those times.

I've also noticed that on several of recent VA appraisals here, they seem to be coming in a bit higher than would be expected in our market and have confirmed this with other agents here too. Seems they don't give as much weight to "on market homes".

Wendy Rulnick said:

OH I see - contesting the appraisal - tough one!

Dawn Barrier SFR®,CSP®,HRC said:
Wendy,

It seems the VA appraised Value is based on a 3 month old comp about $15K higher than where it should be based on their 88% calculation. And we have No unnessary closing costs and even ran #'s with a lower commiss. & still off about $7,000.

Wendy Rulnick said:

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.
Wendy Rulnick January 5, 2011 at 10:49am

OH I see - contesting the appraisal - tough one!

Dawn Barrier SFR®,CSP®,HRC said:
Wendy,

It seems the VA appraised Value is based on a 3 month old comp about $15K higher than where it should be based on their 88% calculation. And we have No unnessary closing costs and even ran #'s with a lower commiss. & still off about $7,000.

Wendy Rulnick said:

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.
Wendy Rulnick January 5, 2011 at 10:36am

Dawn - VA appraisals last for six months. You cannot get around that!

Dawn Barrier SFR®,CSP®,HRC said:
Wendy,

It seems the VA appraised Value is based on a 3 month old comp about $15K higher than where it should be based on their 88% calculation. And we have No unnessary closing costs and even ran #'s with a lower commiss. & still off about $7,000.

Wendy Rulnick said:

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.
Dawn Barrier eXp Realty Vegas January 5, 2011 at 10:32am

Wendy,

It seems the VA appraised Value is based on a 3 month old comp about $15K higher than where it should be based on their 88% calculation. And we have No unnessary closing costs and even ran #'s with a lower commiss. & still off about $7,000.

Wendy Rulnick said:

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.
Wendy Rulnick January 5, 2011 at 10:26am

Dawn - I have never seen a variation of that. BUT if your price is in line with the market, and your closing costs are not loaded up on the HUD, I don't know why your sale would not work.

This reply was deleted.