fha HAS SUSPENDED ALL STANDARD SHORT sale PROGRAMS THROUGH aPRIL 2025 IN FAVOR OF THE COVID 19 Streamline Short Sale!
FHA has always offered a short sale program ( FHA Pre-foreclosure Sale), which had a standard process, including financial documentation. Effective 2023, FHA suspended their standard short sale process, in favor of the Streamline COVID-19 short sale which eliminates borrower financial documentation and is a much simpler easier process. This program will run through April 2025, making it the easiest time in history to get your short sale approved.
Have you fallen behind with your FHA loan and need out?
FHA has been very busy handing out loan workouts for the last few years. Since the beginning of Covid-19, FHA has been offering loan modifications, forbearance and partial claims like candy, even to borrowers who never asked for or needed them, and with no borrower financial documentation involved.
Many homeowners have enjoyed not paying their mortgage for some time, or getting a lower payment. However, the fact is there really are no free rides and all these loan workouts have a cost – that cost usually being most or all of the homeowners equity, through a HUD Partial Claim (silent second mortgage).
What’s the downside of a lower payment, even if you lose your equity?
Theoretically there is no problem with losing some home equity as long as you never need to move and/or homes keep appreciating. The problem is that the market has started shifting and many home values are even declining in our current market. Furthermore, life has a way of happening and staying in the same home indefinitely is simply not a realistic option for most people, and selling becomes a necessity rather than a choice.
What happens if you have to sell and you don’t have the equity to do so?
If you owe more on your mortgage than your home could sell for you have two choices to sell: Pay the difference out of pocket, or pursue a short sale. In a short sale the lender allows the property to sell and agrees to take a loss on the mortgage debt in order to make a sale possible. Lenders do this because it is more profitable than foreclosing on the home. There is a process required, including a lengthy financial disclosure process to prove the inability to pay. FHA has currently suspended this process…
NEED HELP WITH AN FHA SHORT SALE? WE’LL HANDLE ALL THE DETAILS, AND IT WON’T COST YOU A THING!
We are grateful to Minna for her knowledge, professionalism and expertise in shortsales. She truly cares about her clients and it is evident in the manner she represents them. She has a strong work ethic and keen negotiation skills when dealing with financial institutions and buyers. We strongly recommend Minna and her company if u want immediate results.
T.G.
Last Updated on March 18, 2024 by Minna Reid