Comments on: HUD Updates Reverse Mortgage Servicing FAQ http://reversemortgagedaily.com/2009/11/04/hud-updates-reverse-mortgage-servicing-faq/ Reverse Mortgage News and Information Sat, 26 May 2012 06:42:00 +0000 hourly 1 http://wordpress.org/?v=3.3.2 By: Anonymous http://reversemortgagedaily.com/2009/11/04/hud-updates-reverse-mortgage-servicing-faq/comment-page-1/#comment-46740 Anonymous Mon, 27 Dec 2010 05:34:00 +0000 http://reversemortgagedaily.com/2009/11/04/hud-updates-reverse-mortgage-servicing-faq/#comment-46740 I am a Realtor and I am attempting to close a short sale on a HUD insured reverse mortgage. We have an otherwise qualified FHA buyer but Bank of America says their interpretation of HUD guidelines prevent them from paying typical, ordinary and customary seller and buyer loan costs. For instance, despite the fact that nearly all closing in Washington State are handled through an independent 3rd party, an escrow or an attorney, Bank of America says HUD guidelines forbid them from paying a closing settlement or escrow fee. They justify their decision by claiming that since Washington Law doesn’t specifically state dictate that closings have to occur through an escrow company or an attorney, they cannot be considered typical, ordinary or customary. Except for the closing of a FHA repo, in my own 38 years of experience in real estate, I have not had a circumstance where a closing or settlement fee was not paid in some fashion. In the case of the FHA repo, HUD has a specific closer located in Snohomish, Washington, who is under contract with FHA to handle those closings. The bottom line though, our FHA buyer will likely be unable to complete the purchase because, like a majority of FHA buyers in our jurisdiction, the buyer lacks the additional funds, beyond the down payment, to complete the FHA purchase. Bank of America’s contention is, the data we’ve provided concerning what is typical, ordinary and customary in our jurisdiction has been deemed unsatisfactory. Yet, Bank of America has been unable to identify for us what exactly would be deemed satisfactory. My questions are; 1). Is there any recourse against Bank of America? 2). Is it really the intent of HUD to essentially make it impossible for a FHA buyer to purchase a home where it involves the short sale of a HUD insured reverse mortgage? In the case mentioned above, due to Bank of America’s rigid unrealistic interpretation of the HUD guidelines, that is exactly what is happening. Is that really the intent? I would be extremely interesting in a response to our situation and my questions. Respectfully submitted. I am a Realtor and I am attempting to close a short sale on a HUD insured reverse mortgage. We have an otherwise qualified FHA buyer but Bank of America says their interpretation of HUD guidelines prevent them from paying typical, ordinary and customary seller and buyer loan costs. For instance, despite the fact that nearly all closing in Washington State are handled through an independent 3rd party, an escrow or an attorney, Bank of America says HUD guidelines forbid them from paying a closing settlement or escrow fee. They justify their decision by claiming that since Washington Law doesn’t specifically state dictate that closings have to occur through an escrow company or an attorney, they cannot be considered typical, ordinary or customary. Except for the closing of a FHA repo, in my own 38 years of experience in real estate, I have not had a circumstance where a closing or settlement fee was not paid in some fashion. In the case of the FHA repo, HUD has a specific closer located in Snohomish, Washington, who is under contract with FHA to handle those closings.

The bottom line though, our FHA buyer will likely be unable to complete the purchase because, like a majority of FHA buyers in our jurisdiction, the buyer lacks the additional funds, beyond the down payment, to complete the FHA purchase. Bank of America’s contention is, the data we’ve provided concerning what is typical, ordinary and customary in our jurisdiction has been deemed unsatisfactory. Yet, Bank of America has been unable to identify for us what exactly would be deemed satisfactory.

My questions are;

1). Is there any recourse against Bank of America?
2). Is it really the intent of HUD to essentially make it impossible for a FHA buyer to purchase a home where it involves the short sale of a HUD insured reverse mortgage?

In the case mentioned above, due to Bank of America’s rigid unrealistic interpretation of the HUD guidelines, that is exactly what is happening. Is that really the intent?

I would be extremely interesting in a response to our situation and my questions.

Respectfully submitted.

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