Posted on Oct 17, 2012 in Roseville and Sacramento Short Sale FAQs

Hi this is Mark Peek with Keller Williams Real Estate, your short sale specialist for the Roseville and Sacramento area. Today’s topic is on FHA loans and short sales. FHA loans weren’t very popular during the biggest part of the housing boom but they started making their way onto the scene again in 2007-2008 when our market was still in decline. We’re starting to see more and more of these FHA loans in default, so much to the fact that Wells Fargo is now being sued by the government.

In an FHA loan, the government backs the loan and in this case they are alleging that Wells Fargo falsified documents that made these borrowers qualify for an FHA loan. As a result the government has paid hundreds of millions of dollars in claims because when a loan defaults and goes into foreclosure, FHA has to pay the claim on it; that’s what your mortgage insurance is for. It pays the claim back to the lender which in this case is Wells Fargo and they’ve paid quite a few claims to Wells Fargo; as a result they’re looking a bit deeper into this situation. If you have an FHA loan and you’re in a situation where you feel you need to short sale your home, an FHA short sale is a little bit different as far as getting it approved. You have to have what’s called an approval to participate in order to proceed with the short sale.

If you have any further questions about this, or any other short sale related matter, feel free to give me a call or fill out the getting started form on our website because I’d be happy to talk to you about it in further detail. Also, if you’d like to know what your property value is, how underwater you are and how long it will take you to break even on your home, try out the short sale decision calculator on my website. It’s a great tool that a lot of homeowners in Roseville and Sacramento are taking advantage of, so I’d like to encourage you to do the same. Thanks again for visiting me at my short sale blog today.

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