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HUD SHORT SALE PROBLEMS!

Posted by Robyn Soerries-Funk on March 21, 2011 at 12:38pm
I am having a problem with HUD! Has anyone dealt with them? I have gotten my Seller approved for the short sale and they are giving us till May9th. On that date they will file a foreclosure. I have submitted offers but they will NOT negotiate. They say they have a formula, they plug them into computer and that's it! NO negotiating! My Seller got an 80/20 loan. They got an appraisal and now want 89% of appraisal. They are forgetting they only own 80% of the loan. So they want $55,440 She owes them $55,400 and the 2nd mortgage $25k. The 2nd wants $3k, the 1st says they can't get more than $1500.00. What HUD accepts decreases over time which is ridiculous because they are actually getting less money. They will wait 180 days to get $52,920 and meanwhile she is not paying her payment to them. Hmmmm....does tha make sense? NO! Has anyone else experienced this with HUD? Any suggestions? I gave them a contract for $52,000 which is about what the home is worth in it's current condition, maybe a little more. THEY STUPIDLY TURNED IT DOWN! So frustrating! None of my other short sales have been like this but they were not HUD's.
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Comments

  • Bryant Tutas March 22, 2011 at 3:24am

    Remember there is nothing stopping the buyer form contributing to the 2nd as well. There is a specific process to dispute the value. Be sure to ask the lender to send you over the information.

     

  • Robyn Soerries-Funk March 22, 2011 at 3:16am
    Thanks Bryant. Yes, it is the approval to participate that we have and even at the 61-180 days, I need contract for $59,130 which is too much. She is giving her $1000 to 2nd and I will have to give $500 of my commission to 2nd; they won't negotiate any further. I will be taking your advice and dispute the value!!!
  • Bryant Tutas March 21, 2011 at 1:18pm

    Robyn. HUD has guidelines and your offer must fit or it will be rejected. If you feel their value is off then you can dispute the value. Other than that HUD will not accept less than 88% (NET) of the appraised "as is" value for the first 30 days.On day 31 it drops to 86% and then on day 61 it drops to 84% . The figure they will accept (Fair Market Value) is on the HUD 90045 (Approval to Participate).

     

    HUD will only pay $1,500 towards junior liens. However the borrowers $1,000 incentive can be added to this figure for a total of $2,500.

     

    I guess my question to you is..If there is enough money from a sale to pay off the 1st in full then why did the seller apply for  a HUD PFS? When really all they needed to do was settle with the 2nd.

     

    HUD short sales are very easy. They even give you a pre-approved figure!! The problem is you are trying to get them to negotiate for less than what they have already agreed to take. It ain't ever going to happen.

     

    Your options are to find a buyer willing to pay enough for the property or dispute the value and try to get a new HUD 90045 issued. Any thing else is just wasting time.

     

    Go to the HUD FHA group on this site and pull up the HUD guidelines and procedures. They will help.

    http://shortsalesuperstars.com/group/fhashortsales
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