Why Short Sale? – FREE information on Foreclosure Defense, Mortgage Modification, Tax Consequences, Deed-in-lieu-of-foreclosure, Short Sales, Deficiency Judgments, Bankruptcy Referrals & more. John Michailidis, SaraMana Properties – Phone: (941) 822-5221
What Is A "Preliminary HUD-1" And Why Is It Critical To Short Sale Success? Sarasota, Bradenton, Venice, Lakewood Ranch, Florida
The Preliminary HUD-1 Settlement Statement form (Department of Housing and Urban Development Form #1) is basically an accounting balance sheet that real estate closers use to track all of the funds in a real estate transaction. It's a two page form that tracks all of the monies going to and coming from (debits and credits) both the buyer and seller. An example of page 1 of the HUD-1 is shown.
Understanding the HUD-1 Form (actually, the closers and agents you work with are the ones who actually have to know and understand the form) is critical to your Short Sale success, because this form must be submitted to and approved by the Short Sale Lender prior to closing, and any deviations from approved costs and credits can lead to a postponement, or cancellation of the closing.
Other than making sure that you only work with knowledgeable and experienced Short Sale Professionals, the thing you need to know about the HUD-1 is that it is a very precise document -- if it doesn't match up exactly with what the lender has approved there will be problems!
A Short Sale Approval Letter contains very specific instructions and conditions upon which the approval is based. It spells out exactly how much money the bank will allow for closing costs, commissions, taxes, credits, etc., and who may, and who may not pay for them.
So long as the Preliminary HUD-1 (it's "preliminary" because the deal hasn't actually closed yet) matches up with the approval letter, and the lender receives a copy and approves it at least 48-hrs prior to closing, you shouldn't have any problems closing your Short Sale!
The SaraMana preForeclosure & Short Sale Assistance Team helps Short Sale Buyers, and Property Owners in Sarasota, Lakewood Ranch, Bradenton, Venice and throughout Manatee & Sarasota Counties Florida to STOP Foreclosure, potentially Avoid Deficiency Judgments, Successfully Short Sale their homes, and move on with their lives.
For more information, Call 941-822-5221, or use this ONLINE FORM.