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Permalink Reply by joe beauchamp on September 28, 2011 at 4:44pm

All I would do with the 2nd is give them the docs with a HUD-1 that shows what you expect the 1st to pay and wait until you get further into it.  FNMA will not allow more than 6% or $6K max to go to a 2nd.  Nor will their HAFA. And FNMA no longer supports HAFA if you have a buyer.

HAFA rules have that same limit plus the seller is not allowed to contribute either cash or a note and no deficiency is allowed after the short sale.  So you see, PNC is yanking your chain if you actually expect to get anywhere with FNMA or HAFA.  FNMA will max the 2nd at $3300 - same for HAFA.  I don't know if FNMA cares about a note to the 2nd.  Gee, that's really generous of PNC to offer to let the seller pay 100% while the first gets shorted.  HA!

So, now you know - no HAFA. FNMA will not allow more than $3300 to go to PNC.  Now have fun negotiating.  You might have to/be able to POC something to appease PNC.  I would first send them the HUD-1 with the $3300 on it saying something like, "Since one of your major investors is FNMA, I know that you are aware that they will allow no more than $3300 to go to you."  Maybe even, "If this is unacceptable, please contact FNMA directly since you undoubtedly have a much better relationship with them as their employee than I do."  Maybe minimize some bull and sputtering and give you a solid starting point. Then, of course, your fun time starts..

Another path is to put the $5500 in the HUD-1 to PNC and let it sit until FNMA slashes it.  If the person at PNC is dumb enough, he may think he is getting away with his 10% and that may make it easier when you later come back with FNMA's cut and the line about them talking to FNMA - so, you went to bat for them but FNMA told you NO.  It could take some of the wind out of PNC's sales.  Judgment call..