When doing an HUD (also called FHA) Pre Foreclosure sale, you can get the sale price approved in advance. Your seller should apply to his lender to see if he qualifies. Doing this at time of listing or before, you can really speed up the approval of a contract. You see, by getting the short sale lender the seller financial documents and request to participate, they will order an appraisal. That value is shared with the seller and the listing agent.
This home at 352 Hwy 2, DeFuniak Springs, Florida has been approved as a HUD Pre Foreclosure sale by Bank of America. It was approved 23 days after submitting the short sale contract, buyer proof of funds and HUD. But that is not the whole story.
In this case, Bank of America took four months to send the HUD package to the seller after application. It took them almost four more months to issue an "Approval to Participate". By that time we already had a contract submitted that more than covered the appraised value.
This lengthy process with Bank of America's HUD PFS program may have been an anomaly. My advice to short sale listing agents and sellers, is to apply as soon as you know you want to go forward with the program. This will save you valuable time when you finally get a buyer.
It's Wendy!
Wendy Rulnick, Broker, Rulnick Realty, Inc.
Call toll-free 1-877-ITS-WNDY (1-877-487-9639) or local 850-650-7883 ext 204
Email Wendy: itswendy@rulnickrealty.com
Destin Short Sales & Pre Foreclosure Help.
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Wendy is a short sale and pre-foreclosure specialist and has been featured in "Kiplinger Personal Finance Magazine" and "Florida Realtor Magazine". Call Wendy Rulnick, Broker/Owner,to list and sell your home or condo on the Emerald Coast of Florida in Walton, Okaloosa and Santa Rosa County- Destin, Santa Rosa Beach, Fort Walton Beach, Niceville, Bluewater Bay, Navarre, Seagrove Beach, Watercolor, Sandestin, Seaside, Crestview, Rosemary Beach, Mary Esther, Shalimar, Eglin AFB, Hurlburt Field.
Great advice Wendy!
But, pricing in today's market with out an offer is scary. Aren't you stuck with that number for 6 months?
Bill
Wendy, looks like you're on a roll. Great work! Keep them coming.
Anything that speeds the process is great! Thanks for your insights Wendy...I learn so much here!
Hi Bill - Good point. HUD does allow price reductions, this is from the HUD site: For the first 30 days of marketing, the short sale lender (mortgagee) may only approve offers that will result in a minimum net sale proceeds of 88% of the "as-is" appraised Fair Market Value (FMV). During the next 30 days of marketing, the lender may only approve offers that will result in minimum net sale proceeds of 86% of the "as-is" appraised FMV. For the rest of the marketing time (60 days), the lender may only approve offers that will result in minimum net sale proceeds of 84% of the "as-is" appraised FMV.
Gabe - THANK YOU!
Laura - You are welcome :)