FHA Short Sales
FHA short sales and VA short sales are no different from other types of short sales. When a
homeowner is upside down on a mortgage, a real estate short sale will work not matter where the homeowne is, what
type of mortgage loans he or she has, and how many.
How to do FHA short sales?
When doing FHA short sales, you need to remind yourself that the FHA mortgage loan is isured by
HUD. This HUD insurance makes FHA short sales a little different from other short sale process. HUD will pay the
This FHA mortgage loan restriction has a huge impact on how much you can offer to the bank to
make an acceptable short sale deal.
Example of FHA short sales
A real estate property is worth $250,000 in good retail condition. The FHA appraisal come sin at
$190,000. HUD will pay the bank 82% of the appraised value which is $190,000 after the sheriff's sale. But if your
real estate investor is able to offer the bank that price, the short sale is successful and you will no longer be
upside down on your mortgage. Also remember that your real estate investor cannot offer the bank less than 63% of
the FHA mortgage loan amount.
How to do VA short sales?
If you are a homeowner with an upside down VA mortgage, a VA short sale may be in order. VA
short sales are similar to FHA short sales. For VA mortgage loans, VA guarantees: