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Fannie Mae Short Sale Loans Must Be Submited Through Servicer and HomePath Website

November 24, 2014

Effective Nov. 10, Fannie Mae Short Sale loans must follow the HomePath process. HomePath is a Fannie Mae-owned website that will facilitate the negotiation of short sale offers between Fannie Mae and the real estate agent, among other currently provided services.

Based on Fannie Mae's new directive, agents must submit all offers through Equator as they do today, as well as through HomePath, with the exception of active bankruptcy or active litigation. All required documents must be submitted to Bank of America through the Equator system. For information on using Equator, please visit Bank of America's Agent Resource Center under the System Education tab. Both of these actions must occur before Fannie Mae will negotiate the offer.

To access HomePath, visit First-time users will be required to register. By registering, you will be able to request list price guidance and/or submit your highest and best contract amount with terms acceptable to the homeowner for review directly to Fannie Mae. Fannie Mae will then provide you with information directly through the HomePath website, alerting you to the list price guidance amount, as well as notify you of approvals or counter offers in connection with any purchase contracts you submit for review. For more information on using HomePath, there are several tutorials available under the Resources tab on the website.

The real estate agent must obtain a copy of Fannie Mae's Homeowner Authorization Form (located under the Resource tab on the HomePath website), have it signed by the homeowner and upload it to HomePath.
Fannie Mae will not be able to move forward with the Short Sale until the signed Homeowner Authorization Form has been uploaded to HomePath. 

Once the contract negotiation is complete, Fannie Mae will provide a conditional decision through HomePath and Bank of America will send a final decision for the short sale transaction through Equator.

Contact Fannie Mae at 1-800-7Fannie if you have any questions about the process or call 1-888-894-0205 to reach the HomePath Short Sale portal support center if you have any questions about how to use the HomePath Short Sale Portal. Training aids can be accessed from the Short Sale resource page.

FHA/HUD requiring agents to list MLS for a minimum of 15 days

October 28, 2014

Short Sale Agent Update

October 28, 2014

Mortgagee Letter (ML) 14-15
Effective October 1, new Housing and Urban Development (HUD) guidelines require agents to have the property listed on the Multiple Listing Service (MLS) for a minimum of 15 days before any purchase contract can be reviewed by the servicer.

Note: The 15-day requirement starts when the property began listing on MLS at the appropriate price in relation to the Federal Housing Administration (FHA) "as-is" appraised value.

Additionally, the FHA Preforeclosure Sale Addendum & Real Estate License Certification Form has been updated on the Agent Resource Center (ARC) under the Forms & Tips tab.  Please discard any previous versions you may have and begin using the updated version immediately.

Bank of America - Process Changes to Short Sale Document Collection

December 20, 2013

Short Sale Agent Update

December 19, 2013

To improve the customer experience, Bank of America has enhanced its home retention application and document collection process. We are committed to helping customers explore all opportunities to resolve their mortgage delinquency. Changes to our home retention evaluation process have been implemented to support that commitment.

What has changed?

Application & document collection process:

A streamlined application process means that customers will now be evaluated for all available options and programs for which they are eligible, including modifications, short sale and deed in lieu, at the same time from one loss mitigation application. This approach will give customers more complete information about the range of options available and reassurance that Bank of America is working with them toward an acceptable delinquency resolution.

The short sale process will begin automatically if it is determined that it is the best option for the customer. Customers interested in proceeding with the short sale process can advise the short sale specialist to add the real estate professional of their choice to the file. The same customer documents collected during the home retention evaluation (modification) will be used for the short sale transaction.

Eligibility criteria has not changed; however:
  • We will continue to provide our customers with a comprehensive list of all the required documents, which are to be collected at the beginning of the process.
  • Notification will be provided advising of all options and programs for which the customer was evaluated along with the approval or denial resulting from the evaluation.
Helping customers understand this approach is critical to setting expectations and successfully partnering with them.

Short Sale Initiation Process:

The customer may choose to proceed directly to a short sale evaluation and not be evaluated for home retention options first. Ensure the customer contacts their assign Customer Relationship Manager (CRM) to discuss options that are available to them. For this type of direct initiation a Borrower Election Form will be required before an approval can be provided.
  • Customer Initiation: The customer calls Customer Care 1.866.880.1232 to request a short sale without previously being evaluated for home retention options. The Customer or Authorized Third-Party will work with the assigned short sale specialist to upload the required documentation
  • Agent Initiation: The customer's agent or Authorized Third-Party opens the short sale record in Equator ® and assists the customer to upload the required documentation
For both Agent initiated and Customer initiated files, a letter will be sent advising of any missing borrower required documents. In addition, for this type of direct initiation an Advisement letter containing the Borrower Election Form will be sent. The fully executed Borrower Election Form will be required before an approval can be provided.

To save time and avoid delays with the short sale process, confirm the customer has explored all available home retention options prior to beginning the short sale or has chosen to pursue a short sale instead.

As always, additional materials and guides can be located on the Agent Resource Center at Find information about Consumer Financial Protection Bureau (CFPB) Mortgage Servicing standards at:


Bank of America (BOA) Short Sale Agent Update - HUD / FHA Short Sale Requirements

October 7, 2013

Short Sale Agent Update

October 2, 2013

Effective October 1, 2013 U.S. Department of Housing and Urban Development (HUD) has announced the following changes to their Federal Housing Administration (FHA) Short Sale requirements:
  • Eligibility Requirements: To successfully complete a short sale under the FHA short sale program, the borrowers must meet the following requirements:
    • They cannot list the property with or sell it to anyone with whom they are related or have a close personal or business relationship.  In legal terms, it must be an "arm's-length" transaction.  Any knowing violation of the arm's-length requirement may be a violation of federal law.
    • Your mortgage must be in default, on the date the short sale transaction closes.
    • Before closing, any additional liens against the property must be released. A lien holder who demands a payment to release its lien must submit a written statement, and an agreement to release the lien if that amount is paid.
  • Financial Hardship Validation Requirement: For a standard preforeclosure sale, servicers must use a Deficit Income Test (DIT) to determine a homeowner's financial hardship.  The IRS Collection Financial Standards will be used to verify homeowners expenses not reflected in their credit report.  Only owner-occupied properties are eligible for the standard preforeclosure sale.
  • New Streamlined Short Sale Option: Homeowners eligible for a streamlined short sale may not be required to submit financial information or have a financial hardship.  Principal residences, second homes, investment properties and service members who have received Permanent Change of Station (PCS) Orders are potentially eligible.
  • Property Appraisal: The appraisal of your property should be completed within approximately ten business days.  After the appraisal, the short sale file will be updated and prepared for review.  In some cases, approval may be required by the investor and/or FHA, which may take more time.
  • Cash Contribution: As a new condition, you might be required to make a final payment (sometimes called a cash contribution) before or at closing.  This payment will reduce the deficiency balance.
  • Borrower's Incentive Compensation: If you are an owner occupant, acting in good faith, and successfully selling your property, you may be eligible for an incentive of up to $3,000.  If you are required to make cash contribution, you are not eligible for this incentive.
  • Short Sale Contract Addendum:
    • The revised FHA short sale addendum must be signed and dated by all parties.  Under this addendum, all parties agree that the subject property must be sold through an arm's-length transaction.  An arm's-length transaction is defined as a short sale between two unrelated parties that is characterized by a selling price and other conditions that would prevail in an open market environment.  Also, no hidden terms or special understandings can exist between any of the parties (e.g., buyer, seller, appraiser, sales agent, closing agent, and mortgagee) involved in the transaction.
  • Action Required: Review the Short Sale FHA Program guides located on the Agent Resource Center:
To review additional information about FHA requirements, please log on to Questions can be directed to Short Sale Customer/Agent care at 1.866.880.1232.

Short Sale Myth: Faxing in a Complete Short Sale Package will lead to an approval in less than 30 days.

June 5, 2013

     There is a rumor floating around for a long time that there are secret tricks or 'ins' to get a short sale approved in 30 days.  Usually these folks will tell you that by submitting a 'complete short sale package' with all your financial documentation will result in a short sale that is approved in less than 30-days.   This is simply untrue.


     Short Sale Financials typically include ..
  • Bank statements (last 2 months, all accounts, all borrowers) *continuously needs to be updated
  • Pay Stubs (last 30 days) * continuously needs to be updated
  • Tax Returns (2 years)
  •  Financial Worksheet of all your income/expenses

     For starters, yes there are streamlined short sale programs (those not requiring any financial documentation) that can be approved in less then 30 days, but the approval time has nothing to do with submitting a complete short sale package, it has to do with the lender not having to review the financials, period.  These short sale programs that require little or no financial documentation include the Bank of America Cooperative Short Sale, HSBC Short Sales, some Short Sales with smaller banks, some 2nd Lien Short Sales, and short sales initiated after bankruptcy (some lenders).  So why would you generously collect, scan and send all of your financial records to a creditor who could potentially be looking to sue you in the future if the property ends up in foreclosure?   This is one reason why a 'complete short sale package' should never just be blindly faxed over to a lender to initiate a short sale.

     Secondly, many of the large lenders use an online system called equator to process their short sales.  With this system the lender will request some or all of the financials in specific tasks at certain times during the short sale process.  As long as the seller can quickly come up with these documents, then everything can continue to move forward on schedule with little or no down time.

    Third, the lack of a 'complete short sale package', is not the main reason short sales take so long.  The reason they take so long is because the bank takes a long time to review all the financial documents and because they have too many short sales to process at any given time.  Additionally, some lenders take a long time to even look at the financial documents that it surpasses their guidelines for document expiration and they require updated documents.  Of course some lenders won't tell you this until someone calls in to get the status.  Factor in the issue of high employee turn-over (hired and fired), and you can quickly see why short sales really take so long.

     If you have any other questions about Short Sales or are considering selling your home short sale, please feel free to contact me any time.


     Phil Zimbardi
     Real Estate Broker / Realtor
     Short Sale Specialist

     TOP END Properties

     Phone: 203-936-7776
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