Keep in Mind there IS an Owner Occupancy Guideline Dealing With a FHA Short Sale

Keep in Mind there IS an Owner Occupancy Guideline Dealing With a FHA Short Sale

If you have an FHA (HUD insured) mortgage in Massachusetts and are underwater with your loan, you may be looking to sell short.  FHA has very specific guidelines as to how you can short sale your property.  Their program is called the Pre-foreclosure Sale or as we in the short sale industry call it PFS.

There are many guidelines and requirements to be approved for the PFS program, but one in particular lately seems to be forgotten by many borrowers and agents.

The PFS Short Sale program requires that borrowers (or sellers) owner occupy the home, and only in specific cases will they approve you for the short sale program if it is not owner occupied:

1) If you must move out, you can be approved if you had to move for a job requirement.

2) If you are 90 days or more delinquent on their FHA-insured loan as of the date of the mortgagee’s     review; and have a credit score of 620 or below you can be approved for the program

3) The property may not have been rented for more than an 18 month time frame

Don’t panic.  After all, guidelines are not law, and if you have an unusual case, you can always reach out to HUD directly through its newest contractor and see if you can obtain an variance.

I have posted the new contractor contact information below:

Novad Management Consulting
Shepherd’s Mall
2401 NW 23rd Street, Suite 1A
Oklahoma City, OK 73107
Toll-Free Telephone Number: (877) 622-8525
Fax Number: (800) 489-1733
Borrower inquiries (HECM or Forward)
customerservice@novadconsulting.com

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