Freddie is asking for a seller contribution:
1st and only lien holder is IndyMac, no 2nd. Pay off is 186k. Offer is 150k. After analyzing the offer, negotiator comes back with:
Freddie Mac needs (removed Seller name) to contribute $3,000 cash towards the loss at closing. Please advise if seller can commit to contribution. If so, please show on line 403 of the HUD. If not, please advise why.
This is a great offer based on the comps! What's the 3k for??
What's the best way to not have to pay the 3k and still get the approval?!! Would a basic explanation such as "Seller's are undergoing financial hardship and not in a position to contribute any funds" suffice?
Thanks so much!
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Have the Homeowner revise the Hardship Letter (if appropriate) and review financials. Then request the file be sent to FNMA for their approval. The Servicer is probably doing the bare minimum that their delegation allows.
I meant FHLMC.
Or, consider it a counter offer. If the seller cannot contribute some or all, go to buyer and say "Great news! We are only $3,000 away! (keep in mind that they must bring it in cash to close and not bump offer 3K)
Works all the time.
www.ssprocessors.com
Freddie is in the habit of asking for a cash contribution when the seller has the means to pay it. Just present it to the seller and have them either accept, or counter. Have the seller write a brief letter explaining their acceptance or counter and send it over to Chase with a revised HUD.
As of November 1, 2012 the Federal Housing Finance Authority initiated new Streamlined Short Sale Guidelines that apply to all Fannie Mae and Freddie Mac mortgages.
In a nutshell:
Cash Contributions - Borrowers that are less than 31 days delinquent MUST make a cash contribution to the loss. And borrowers more than 90 days delinquent and a credit score of less than 620 at the time of the evaluation are not required to make a contribution. Specific guidance on “borrower contributions” where required, including how to calculate the contribution amount and making contributions MANDATORY where the borrower is 31 days or less delinquent. The guideline here is cash reserves of greater than $10,000 or 6 times the total monthly mortgage payment will trigger a contribution by the borrower.
Here are the Fannie Mae Standard Short Sales/HAFA II Short Sale Gui...
Here are the Freddie MacStandard Short Sales/HAFA II Short Sale Gui...