Monday, April 7, 2014

Seller Contribution and the Short Sale

Investors (FHA,VA,USDA, FNMA, FM) have their own guidelines and variables to consider prior to acceptance of the seller contribution written into an offer.
Though the contribution may be written into the Offer To Purchase and signed by the homeowner, the lender, when reviewing the offer, may decrease or cut out the seller contribution based on investor guidelines or issues with the minimum net.

It is helpful before placing an offer to clarify with the person negotiating the short sale who the investor is, and what their guidelines are regarding seller contribution. 

FHA short sale properties have similar restrictions to "allowable fees" paid by a contribution as a regular FHA loan. In addition a seller contribution of more than 1% of the buyers new loan requires a variance request and approval from HUD.

Fannie Mae guidelines are more lenient FHA,USDA,VA  and allows  3% seller contribution if the net is met.

Stay in the know work with dedicated short sale specialist. Call or email today!
Terri Balog, The Dwell Realty Group

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