FHA COVID-19 Pre-Foreclosure Sale - Reid Real Estate Group
April 19, 2021

FHA COVID-19 Pre-Foreclosure Sale

SHORT SALE SIGN

Homeowners with FHA loans have options when facing foreclosure as a result of COVID 19. 

FHA offers many options to help borrowers in default get back on track with their payments. But keeping the home is not always an option, and often there is simply not enough equity in the home to sell at a profit! What then? 


FHA COVID-19 Pre-Foreclosure Sale

What is the Covid-19 PFS?

A COVID-19 Pre-Foreclosure Sale (COVID-19 PFS) option is available to borrowers who are experiencing a hardship affecting their ability to sustain the Mortgage due to COVID-19, and who are not eligible for home retention options.

But what if I owe more than my home could sell for?

FHA loans are frequently low down payment loans leaving little equity in the home to begin with. Any attempts at forbearance or loan modification may have resulted in a partial claim leading to excess debts against the property. 

what is a partial claim?

Homeowners with defaulted FHA loans are frequently in a negative equity situation and cannot sell traditionally. The FHA PFS (FHA short sale) allows homeowners to sell for less than they own on their homes and have the difference forgiven. 

How do I qualify for a A COVID-19 Pre-Foreclosure Sale?

Being approved for a COVID 19 Pre-foreclosure sale is nearly identical to qualifying for the traditional FHA PFS program ( FHA short sale).

Short sales are complex, time consuming and come with a danger of foreclosure if not successfully closed. It is critical to get the expert help you need if you intend to pursue a short sale. 

SHORT SALE SIGN

Last Updated on April 19, 2021 by Minna Reid

Minna Reid

Minna Reid is The Broker - Owner of Reid Real Estate Group. Reid Real Estate Group is a full-service Connecticut residential real estate brokerage, specializing in helping homeowners with legal and financial challenges including short sales, probate sales and tax lien complications.

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