I have a short sale that I've started 5 times with Wells Fargo.  The investor is Freddie Mac.  The MI is Radian.  Appearantly Radian wants $4K.  I have the seller or buyer willing to pay the amount requested and still purchase the house.  I have sent numerous letters and called everyone I could find that would answer.  Each time it gets to FM they decline the short sale because of the MI.  Any suggestions?

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Michael,

      What is the reasoning behind Freddie Mac declining the short sale because of the Mortgage Insurance on the file? You need to dig deep to understand the situation as best as possible in order to have the best chance at resolving this. If I were in your shoes I would, escalate to high level contacts at Well's Fargo, Open a case at Freddie Mac, and reach out to the MI company directly. Typically it seems MI has more pull than an investor on a loan.

Brett@ishortsalenow.com

www.ishortsalenow.com

310-564-6389

I agree with Brett - get Radian in your corner.  Are you putting the 4k on the HUD on the seller side as though it is a junior lien?

Contact Radian and tell them that you have someone willing to pay the $4,000.  Obviously, WF has not told Radian that someone is willing to pay it. WF or any other bank, does not tell the MI companies everything about the transaction.  I had this happen to me and when I told  Radian about it they were quite surprised and quickly approved it..  

Thank you for the ideas.  It's been Freddie Mac who has been declining.  I like the idea of putting the $4K on the HUD.  That one I didn't try.  I love the help.  I'm submitting again today.  I will let Radian know the money is covered. I just hate losing.

Michael, if the Buyer is willing to pay, it should be on the HUD, on the Buyer side.  That way, everyone knows it's taken care of.

Maybe you need to call Freddie - see if they are really declining and why.  If the MI is the problem, I think it is the servicer who stops it and doesn't bother the investor. Something seems wrong. And I have found, as others have, that communications from MI/bank/you can be VERY faulty, so that isn't a surprise. Keep in mind when looking for your solution, that banks prefer punishment to logical best deal. You may well be declined for offering $4K from the buyer, "because" the seller has enough income that he "needs" to pay the $4K. When you hear something strange, take a step back and see if you can figure out where they are coming from. It doesn't have to make dollars and sense. Perhaps the buyer can buy $4K of furniture from the seller so that the seller has the $4K, if that is necessary. It seems that you just have to deal with some sneezing fit on the part of someone here and don't have real issues with $$.

Since it's a short sale, and the "Seller" side of the HUD comes from the short sale lender(Wells Fargo). How do I show the seller is willing to pay the MI on the HUD?

This is usually done as "seller contribution" on a line toward the top - line 409 to 412, however, that is a minor detail. You need to get them to agree to the terms - then where they want it is simple (although I've actually had a BofA manager take about a week to position and word a line right to keep BofA happy for a "simple" line).

You really need to find out why your offer is being rejected - from whoever is objecting. It just doesn't make sense that FHLMC would reject your offer because THEIR MI is getting what it wants.

Got it, thanks.

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