My Phoenix short sale client is being charged a $1.00 "processing fee" for his HAFA Short Sale! Thanks Freddie Mac!

By
Real Estate Broker/Owner with Summit Home Consultants

My Phoenix short sale client is being charged a $1.00 "processing fee" for his HAFA Short Sale! Thanks Freddie Mac!

I had to read the email from our negotiator several times.  Next, I looked at the calendar to see if today was April Fool's Day.  FHLMC (Freddie Mac) is actually charging my Phoenix short sale client a $1.00 "processing fee" for his HAFA short sale, and they will not issue our approval letter until they receive it.  I asked the negotiator at Lender Processing Services (servicing our BofA HAFA short sale) if there was a typo in his email, or was it some kind of cruel joke.  

According to the negotiator, Freddie Mac is now charging homeowners a fee equal to 31% of their gross monthly income for their HAFA short sales.  So, if you earn $5,000/month, Freddie will now charge you $1,550.00 as a condition to approving your HAFA short sale.  In our case, my client has been unemployed for two years, and has $0.00/month in income.  I asked our negotiator to follow along with me on the math.  First, you take .31 and multiply it times 0.  Doesn't this equal ZERO?  Needless to say, it was all I could do to keep myself from blowing a gasket.

But wait, it gets better.  I assumed that this $1.00 fee would be handled through escrow.  Nope!  My client must send a check for $1.00, written out to BofA, just as if it were one of his mortgage payments.  Once the $1.00 check clears and is processed, our negotiator will issue an approval letter, and we can close 30 days later.  He told me that the short sale has been approved, contingent on receiving the check for ONE STINKING DOLLAR!  Folks, I couldn't make this stuff up!

Lets think about this for a moment...As of last month Fannie & Freddie have cost the American taxpayers over $170 Billion, according to most of the articles I've read lately.  In October of 2011, the 10 top executives at Fannie & Freddie were payed $12.79 Million in bonuses.  They stand in front of the cameras and our fearless leaders in Washington and try to convince everyone that they are doing their best to help homeowners.

And now, to add make matters worse, they are forcing homeowners that are considering a HAFA Phoenix short sale to pay them 31% of their gross monthly income for trying to do the right thing in short selling their home.  It's actions like this that make my stomach turn.  Forcing a distressed homeowner to write them a check for $1.00 to help offset the costs of conducting a HAFA short sale.  What will they think of next?

If this story ticks you off as much as it does me, share it with others and send it to your elected officials.  Homeowners are sick and tired of rewarding this egregious behavior by bailing these clowns out, and getting totally disrespected when trying to mitigate their losses.  This crap needs to stop, and it needs to stop NOW!

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Gene Riemenschneider 03/22/2012 02:57 PM
Topic:
Real Estate General Information
Location:
Arizona Maricopa County
Groups:
Short Sales and Forclosures ONLY
Short Sales Specialists
Short Sale REALTORS®
Short Sale Support Group
Voice of Reason
Tags:
phoenix short sale
fannie freddie bailout
fannie freddie executive bonuses
freddie mac short sale processing fee

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Ambassador
1,611,279
Florida Tolbert Team Keller Williams Advantage
Keller Williams Advantage III Realty in Lake Nona - Orlando, FL
Keller Williams Land Division Specialist

YOu know now that you say this, I didn't understand until now but I short saled my home last year and a condition of approval of HAFA was to make 3 X 1.00 mortgage payments over 90 days or they would not issue approval.

NOw I get it.  As a realtor in 2008, I too was unemployed OFFICIALLY.  he he he

Mar 22, 2012 11:53 AM #1
Ambassador
2,035,114
Fernando Herboso - Broker for Maxus Realty Group
Maxus Realty Group - Broker 301-246-0001 - Gaithersburg, MD
301-246-0001 Serving Maryland, DC and Northern VA

I just HAFAED a short sale. . I got my client her $3000 plun an additional $20K

I'm not really sure where this charges are coming from. .HAFA does give relo costs and they are not supposed to charge the client. .

Mar 22, 2012 11:58 AM #2
Rainer
230,825
Bob Hertzog
Summit Home Consultants - Phoenix, AZ
Designated Broker

Amazing, isn't it Kevin?  I've never heard of it until today.  

Yep, they give the seller $3,000 on a HAFA short sale, but at the same time, they want $1.00 to help offset the costs.  Amazing.

Mar 22, 2012 12:12 PM #3
Rainmaker
560,129
Ken's Home Team LLC. | 360.609.0226 | Portland, OR & Vancouver, WA Real Estate Team
Ken's Home Team LLC. - Vancouver, WA
- SOLD IS OUR FAVORITE 4 LETTER WORD -
i did not think that was allowed to do that.
Mar 22, 2012 12:37 PM #4
Rainmaker
1,431,581
Gene Riemenschneider
Home Point Real Estate - Brentwood, CA
Turning Houses into Homes

The government ignores their own rules all the time.  This is just plan stupid.  

Mar 22, 2012 12:58 PM #5
Rainer
71,855
Bas Panch
SCV Home Buyer - Valencia, CA

Hi Bob. What an eye-opening post. Thanks for sharing this information. Keep up the good work as a top phoenix short sale agent!

Mar 23, 2012 11:51 AM #6
Rainmaker
161,942
Satar Naghshineh
Satar - Amiri Property and Financial Services Corp. - Irvine, CA

Bob, it looks like everywhere you turn, the bank is just making your life just peachy!

Mar 23, 2012 02:03 PM #7
Rainmaker
262,573
Kim & Kristine Halverson
Compass - Santa Monica, CA
Sisters, Realtors

I couldn't believe this Bob ,I think must have read your blog twice.Are they serious?Gosh!Anyway I will make sure to share this blog.Thanks anyway Bob!More blogs to come.

 

 

Mar 26, 2012 07:01 PM #8
Rainer
230,825
Bob Hertzog
Summit Home Consultants - Phoenix, AZ
Designated Broker

Hands down, this is probably the most ridiculous thing I've ever seen from a lender on a short sale.  Amazing, isn't it?

Mar 27, 2012 01:37 AM #9
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Rainer
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Bob Hertzog

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