FHA - HUD Short Sales


FHA - HUD Short Sales

HUD rules for FHA short sales, tips, experiences, etc.

Fax LOA:  918-236-3274

PH 877 622-8525

Members: 580
Latest Activity: Mar 6

FHA Preforeclosure Sale Guidelines


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7-9-13 Updated Pre-Foreclosure Sale (PFS) and Deed in Lieu (DIL) of Foreclosure - Effective 10-1-13.

FHA National Servicing Center 

(877) 622-8525 Customer Service

1-800-489-1733 Fax

1-866-808-5050 Fax for LOA


301 NW 6th Street, Suite 200
Oklahoma City, OK 73102
National Servicing Center:


Please note that effective October 1, 2014, Deval LLC will no longer be HUD's National Servicing  loan servicing contractor. The new contractor, Novad Management Consulting will be your new point of contact.


For all Customer Service questions please contact [email protected]

FHA Contract Clause

"Sale is contingent upon the seller receiving prior written approval of Insert Name of Lender/Servicer."

FHA Listing Agreement Clause

“Seller may cancel this agreement prior to the ending date
of the listing period without advance notice to the broker, and
without payment of a commission or any other consideration if
the property is conveyed to the mortgage insurer or the mortgage
holder.” The sale completion is subject to approval (under HUD
guidelines) by the mortgagee.


Discussion Forum

NOVAD as 2nd lien

Started by Noelle Battle. Last reply by Jason Sanseverino Mar 6. 3 Replies

FHA short sale with Partial Claim

Started by Mike Rosania. Last reply by Jim Stewart Feb 21, 2017. 10 Replies

Reverse Mortgage with HELOC

Started by Lisa Jalufka. Last reply by Brett Goldsmith Jan 31, 2017. 1 Reply

Comment Wall


You need to be a member of FHA - HUD Short Sales to add comments!

Comment by Guerry Clegg on September 25, 2016 at 7:48pm

Asking for a colleague: How does the listing agent escalate a BOA decision with HUD? BOA says the closing cost concession is capped at 1 pct. But the 1 pct CC is for buyers who are getting an FHA loan. The Allowable Costs list still applies. I pulled one of my old HUD1's where they approved both.

Comment by Brenda Houghton on September 8, 2016 at 2:29pm

In our region it takes 30 - 45 days to obtain a Certificate of Release, from the date of the initial document submission. Timing is important, because both the short sale approval and the Certificate of Release have expiration dates. You will want both to be valid at the time of closing. 

Comment by London Cox on September 8, 2016 at 2:28pm

I would recommend anticipating 45 days, but have seen them come back quicker on occasion.  You just want to be sure to get them the complete package of documentation the first time around to avoid delays.  

Comment by Short Sale Connection on September 8, 2016 at 2:26pm

Johnna, we have federal tax liens removed fairly often and it's usually 2 to 3 weeks unless they're busier than usual. The paperwork's not bad after the first time especially if you have an appraisal on hand from either the seller's lender or the buyer. You'll need to send the application after you get approval so try to have it ready to go.

Ross Gahagan - Short Sale Connection LLC

Comment by johnna lodge on September 8, 2016 at 2:17pm

Thank you London. This is great news. From the time you submit required and executed documents to IRS how long did it take for you as an average?



Comment by London Cox on September 8, 2016 at 2:11pm

Johanna - 

Yes, I've run into this issue with the IRS on short sales on a number of occasions and have found them to be pretty cooperative in removing those liens.  As would be expected with dealings with the IRS, there is certainly some paperwork involved, as well as some turnaround time, but so long as it's clear that the property is being sold at a loss and the taxpayer isn't collecting any monies at close, they will usually remove the lien from title.

Here's a link to the IRS page detailing the process and with links to the internal publication that details how to go about it:


Hope this helps and good luck getting your deal approved and closed.


Comment by johnna lodge on September 8, 2016 at 1:48pm

Has anyone been able to move an IRS Tax Lien from the property to the individual? My seller that I am working with on a short sale has over a $20K tax lien that would make the sale of the property a little over market value. The HUD representative suggested this. Has anyone attempted or had success with the IRS removing the lien from the property and attaching to seller? Thank you. Johnna

Comment by Dean E Eshelman, CPA, CDPE, IRES on August 17, 2016 at 7:13pm

Luther Fisher -- Gross is Gross Pay before deduction - Pre-tax income

Comment by Luther Fisher on August 17, 2016 at 4:27pm

Have another Midland short sale. Question I have is, how do we show income on  the short sale application? it asks for 'gross' but is that just take home pay or do we show pre-tax income?


Comment by Brett Goldsmith on August 9, 2016 at 4:43pm

@luther On FHA loans when modifications are approved, many times HUD places partial claims ( silent subordinate liens non interest bearing ) for a portion/total amount of the delinquent dues.


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