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: 578
Latest Activity: Aug 2

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

FHA short sale with Partial Claim

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

Reverse Mortgage with HELOC

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

61 Days in Marketing, HUD refuses to accept less than 88% net - FSD in 2 days

Started by Robin M. Willis. Last reply by Dean E Eshelman, CPA, CDPE, IRES Dec 12, 2016. 3 Replies

Comment Wall


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

Comment by Thomas Turner on December 13, 2016 at 11:01am

This is exact wording from variance letter sent....They sent a DENIED response to servicer and noted that property needs to have repairs made and can have short sale /variance re applied for at that time

Justification for requesting HUD approval of this variance from customary Pre-foreclosure Sale proceed. Please allow the PFS to continue with the appraised value being less than 50% of UPB. The current appraised value of the property is $80,000 is less than the Unpaid Principal Balance $280,740.76 by an amount of $200,740.76. We are requesting permission to proceed using the appraised value. We meet required net. Home is not an active foreclosure. Appraisal completed 11/02/2016. Original ATP has never been issued. PFS is expected to close 01/ 10/2017.

I've two variances denied in past week with hud/fha telling servicer its due to property needing repairs? But, every foreclosure in the country needs repairs and I know they close as short sales everyday..... 

Any suggestions???

Comment by Gladys Nunez on December 13, 2016 at 10:17am

@Dean, I gathered as much.  We will see once I appeal.  Thank you!

Comment by Luther Fisher on December 12, 2016 at 3:23pm

Paul, do you happen to know how long it takes to get the payoff? 


Comment by Dean E Eshelman, CPA, CDPE, IRES on December 12, 2016 at 2:10pm

@Gladys Nunez will be a tough go without a hardship.

Comment by Gladys Nunez on December 12, 2016 at 1:40pm

@Dean E Eshelman just rising bills and everyday living mostly.

Comment by Luther Fisher on December 12, 2016 at 1:30pm

Thanks Paul, I just sent it out.

Comment by Luther Fisher on December 12, 2016 at 12:55pm

I have an issue with a closing attorney. We received approval to close and there are HUD partial claims but the attorney is questioning the letter we got saying it doesn't specifically state that when the funds are received the claims are 'paid in full'. So we are at a standstill. 

I contacted the lender and they said that there is no further documentation provided. 

Any advice?

Comment by Dean E Eshelman, CPA, CDPE, IRES on December 12, 2016 at 12:20pm

@Gladys Nunez. What is the hardship besides payment? Medical, relocation, job downsize etc. See Mortgagee Letter 2013-23 for Cash Flow criteria. portal.hud.gov/hudportal/documents/huddoc?id=13-23ml.pdf

Comment by Gladys Nunez on December 12, 2016 at 10:59am

The cash flow sheet showed a negative flow which baffles me that they denied it. I threw everything but the kitchen sink in that worksheet. They were looking at "overtime" and bonus payments made and because of this said we are technically able to afford the home! I am going to resubmit the financial worksheet along with the hardship letter. Should I just ask for the processor to recalculate? or appeal outright? Thanks Guerry 

Comment by Guerry Clegg on December 12, 2016 at 10:43am

Gladys, you should definitely appeal. You don't need to be behind to get approval to participate. You just have to be behind to close. A Realtor cannot tell a seller to not make a payment, but a seller can connect the dots. I had one where we had to postpone closing 2 weeks so he could miss a payment. As far as you having negative cash flow, sometimes the processor simply miscalculates it. I've had that happen as well. Maybe they are looking at liquid assets.


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