Tip 38-2013: New Guidelines for FHA/HUD Short Sales

On October 1, 2013, FHA/HUD announced new guidelines that will be implemented with all of their pre-foreclosure sales. Some of these requirements are not entirely new. For example, a borrower's income to expense ratio is still evaluated in order to determine the borrower's eligibility to participate in an FHA short sale. However, it is important to note that with the new requirements, FHA is looking more carefully at a borrower's assets. Sellers with assets may be asked to offer a contribution as part of the short sale.

Although these new regulations can potentially create an added layer of complexity to short sales, government agencies are still promoting short sales. Sellers who are contemplating a short sale need to have their financial situation reviewed carefully before beginning the short sale process, and short sale negotiators should take added care to become familiar with the new HUD regulations.

PS - Remember that a short sale is a team effort. Even new guidelines can be tackled when all parties are working together to help reach the successful closing!

 
Contact me at 434-951-0858 or Tucker@TGBLaw.com if you have questions.

William D. Tucker, III
Tucker Griffin Barnes P.C.
Charlottesville, VA
434-973-7474
www.TGBLaw.com