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Short sale after recent loan mod approval

Posted by Marlon Rankine on June 12, 2013 at 2:37pm in Short Sale Discussions

Hello Superstars,

I have a client who would like to short sell her home.  She was recently approved for a loan modification on a FHA mortgage.  The seller's hardship began after a divorce.  The seller tells me she'll be struggling with the modified loan payment.  Can we initiate a short sale under this scenario? I'm hearing mixed information.  My hunch is that she can given the effects of divorce for which her ex-husband is still on the mortgage.  The lender is Wells.  What say you? Thanks.

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Replies

  • Wayne Brooks June 13, 2013 at 2:51am

    Doesn't sound like her circumstances have changed, since the loan mod.  Qualifying for the loan mod sort of flies in the face of qualifying for a short sale.  Obviously, give it a shot though.

  • Alexander Villegas June 13, 2013 at 2:40am

    Yes, she can still be considered for a short sale, especially if her financial situation has changed. 

    • Alexander Villegas > Alexander Villegas June 13, 2013 at 3:49am
      Clarification: They will not qualify her solely because of the divorce. However, she can be considered if she can provide financials that verify the inability to make the payments, even after the modification has been approved. Have her put together a financial statement that show the inability to pay and write a hardship letter explaining the circumstances that have changed.
  • Kevin - Greenville, SC June 12, 2013 at 3:33pm

    Yes.  If the Borrower circumstances change FHA will consider other retention or disposition options.

    • Marlon Rankine > Kevin - Greenville, SC June 12, 2013 at 3:46pm

      Change since the loan mod or the original mortgage?

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