Comment

Comment by Connie Di on July 15, 2011 at 11:41am

I have had the same problems with PFS as I see here.  How do you send in a complete short sale packet that includes a listing agreement and an offer if they won't assign an FHA appraiser to tell you what it has to sell for?  Jume 26th sounds good to me.  I started calling Chase 5 months ago and have called more than a dozen times since July 1, as well as gone into the local Chase bank to call on my behalf.  I have yet to get the same answer twice.  I want to know what to do and what my realtor is suppose to do so she doesn't get burned listing my property preacceptance, only to find out, I don't qualify because I make too much or some other reason.  MLS is 2% I don't have.

 

Also what are the closing costs in this situation.  How much do I need to put aside to make sure i can close.  I have a $255K mortgage.  Market is approx $199K.  I am communting back and forth from MN to Texas for health reasons and pay both a mortagage and rent.  Suppose to expect a 9K pay cut in Aug/Sept. 

Comment by Tara Polley on July 15, 2011 at 8:20am

Hi Paola,

I have called, she has called, we have called together. We have also contacted the FHA Service Center. Bank of America states HUD will be calling. FHA Service Center says Bank of America will be calling. I am losing patience.

Comment by Paola Martinsen on July 15, 2011 at 8:06am

Oh sorry i didint read the last part...so the homeowner has already called in. In that case I would contact HUD Servicing center Phone: (800) 594-9057 and open a ticket.

Comment by Paola Martinsen on July 15, 2011 at 8:05am

@Tara--some banks do that with FHA short sales. I havent had BAC do that yet but they may have started now. Is there a reason why the HO can't call in? I always get on the phone with them and we call the bank together. They will ask them the reason for default and take their financial over the phone so make sure they have the same financial statement you sent in.

Comment by Tara Polley on July 15, 2011 at 8:02am

I have been trying to initiate a PFS Sale through Bank of America since 6/29, and they keep telling me that "by law" they must contact the homeowner to offer other solutions before initiating the PFS review. I have already sent them the entire short sale package, including FHA specific docs to get this rolling, and 2 weeks and 4 phone calls from both the homeowner and myself later, nothing. Any suggestions?

Comment by Andy Morris on July 10, 2011 at 2:14pm

maya... did you find that in the mortgagee letter regarding 31%?  i know that HAFA has such a requriement but never saw that of HUD.  the only requirement i know of is that they can't be able to make their payment.

Comment by Tara Polley on July 8, 2011 at 8:48am

Hi Jim,

I recently ran into the same situation. Per the servicer, the law requires that before moving forward with approving a PFS Sale, they are required to contact the borrower to explore retention options. That is why the reaffirmation would affect "what help they could offer". If your client has no desire to keep the property, the reaffirmation is irrelevant, you can just tell FHA that they have not reaffirmed the debt, and do not wish to, and they can move forward with the PFS review. They may need to speak to the borrower directly, but they can relay the same information. Good luck!

Comment by Jim Stewart on July 8, 2011 at 8:28am

Jim,

I've never run across this situation yet but it looks to me like the key words are "mortgagees MAY offer appropriate loss mitigations options".  It doesn't say "must" so that leads me to believe that it's up to the internal policies of individual lien holders.  You may have to quote the specific paragraph from ML-2008-32 and try to plead your case.

Comment by Jim Schneider on July 8, 2011 at 8:09am

I am currently starting the pre-approval process on a pfs sale on an fha mortgage serviced by US Bank. The client filed Ch 7 bankrupcy previously. When I called HUD to check on my letter of authorization, the HUD rep confirmed, then asked if I knew if my client had re-affirmed the debt. I said I didn't know, but what would that affect. She said, whether or not he affirmed the debt would detirmine "what kind of help we could offer." When I pressed for more details (what would be available, etc) she said she couldn't tell me but directed me to Mortgagee Letter 2008-32. I called my client, who said he doesn't want to re-affirm the debt because in the event of a foreclosure, that would open him up to being sued for the deficiency.

 

As I read Mortgagee Letter 2008-32, it states, "Working through debtor’s counsel, mortgagees may offer appropriate loss mitigation options prior to discharge or dismissal, without requiring relief from the automatic stay and in the case of a Chapter 7 bankruptcy, without requiring re-affirmation of the debt.  It is strongly recommended that the bankruptcy trustee be copied on all such communications.  All loss mitigation actions must be approved by the Bankruptcy Court prior to final execution. "

Here it is Mortgagee Letter 202008-32

Anyone else see something I'm missing???

Comment by Maya Thomas on July 7, 2011 at 4:02pm

My understanding is that if their current payment is 31% or less of their income they can be turned down for a short sale.  There may be an exception, but the seller would likely be responsible for the short fall.

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