Is it possible that a homeowner would have a FHA mortgage that is held CityMortgage or any institutional lender for that matter? I called CitiMortgage yesterday to get the loan info. The girl told me that the loan it’s FHA.
If this is indeed a possible case, would it or should it change my normal short sale approach?
Are FHA easier or more difficult to negotiate than a conventional mortgage?
Are there any specific advise or suggestion for me to bare in mind?
Thanks in advance for your responses.
Thanks for the link. the information states that the borrower has to be accepted into the pre-foreclosure program. How does the owner request acceptance into this program? Can I just call the lender and ask them to place the borrower’s account into this program? The other challenge is, the borrower is actually not in default yet. He was late with this months payment. He is going thru divorce, and subsequently would not be able to afford the home. However, he is still current. I know some lenders will accept a short sale if default is eminent. We obviously are trying to present an attractive package to citimortgage for acceptance. This would be my first FHA short sale attempt. Any input would be greatly appreciated.
The borrower must be delinquent at least 3 months.
Net proceeds of the offer should be at least 82% of appraised value.
The appraised value should be at least 63% of the mortgage.
The mortgagor must be an owner-occupant.
There is verification of the borrower’s decrease in income showing inability to pay the mortgage.
The property was marketed in such a manner that an offer for fair market value could be obtained.
The key to FHA is the appraisal, the lender must follow the guidelines that they have to see a net of 82%. That means that your offer will have to cover all jr. liens, back taxes, realtor fees etc… and still meet the net price that they are after.
There are 2 other ways you can get some extra money…
- Repairs… THe appraiser will list repairs when they submit their results to the lender. If the costs of these repairs is under 3k you can get a check at closing for that amount. If they are over 3k you need to have 3 estimates on the repairs submitted with your request.
- If you close within the 90day timeframe the seller can get 1k credit that you can use to pay realtor fees or jr.liens ect… If you sell within the 90 days but dont close until after you get a $750 credit.