Reverse Mortgage Short Sale - Junior Lien

[Daniel Saba]

Has anyone had experience with a reverse mortgage short sale where there is an additional junior lien? I know HUD only contributes $1,500 towards a junior lien settlement, but if the junior lien holder does not want to settle would HUD allow the buyer to pay off the junior lien out of their own pocket?

[Minna Reid]

HUD also allows the seller to receive a $3,000 relocation incentive which can be used to pay the junior, and there have been times where I have had the buyer contribute towards junior liens.

[Daniel Saba]

Thanks Minna, so you are saying that HUD would allow the buyer to pay it if they chose to?

Side note, have you ever dealt with PHH Reverse?

[Minna Reid]

I have worked with PHH and reverse, can't recall if together ever, but it doesn't matter who the servicer is. All FHA loan products are serviced to the same guidelines.

Sometimes they take issue with buyers paying, sometimes not. Usually you just have to play around with the HUD a little bit to have it work out if necessary. Ultimately though I have been able to get it done every time.

How much is the second?