Solving the Knoxville Foreclosure Crisis
One Homeowner at a Time

Rick Smenner

865-675-8326
RE/MAX Preferred Properties
[email protected]

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Is A HUD 1 Important In A Knoxville Short Sale?

Here is something that drives inexperienced Knoxville short sale agents crazy. It is a HUD-1, also called a HUD. HUD is the Federal Agency, the Department of Housing & Urban Development, also called HUD. A HUD-1 is a document regulated by HUD. It is the financial accounting for a real estate sale. Here is why it is important to a Knoxville short sale. Before a short sale lender will accept a short sale, they want to know what they will net from the sale. A HUD-1 breaks down all the projected closing costs so the lender can see their net. Most agents are familiar with a HUD-1. They see them at the closing of every home they sell. But, seeing a HUD-1 at a closing is not the same as the familiarity you learn on short sales. See, if you mess up on that HUD-1, then it puts the short sale transaction in jeopardy. The short sale lender will look at a projected HUD-1 and agree to accept a certain number. If unexpected costs get added to the HUD-1, then that net goes down. (There are always unexpected costs on a short sale. I can tell you from personal experience.) Now, the agent has to go back and re-negotiate with the short sale lender. That can drag out the process another 60-90 days. The buyer will usually get frustrated and cancel the contract. Then, the agent has to re-sell the house and start the process all over again. This is what causes many agents to hate short sales. They didn’t take the HUD-1 seriously and had problems on a short sale. As a result, they think all short sales are impossible. To truly be successful at short sales, the agent must understand HUD-1s inside and out. They need to make sure that every single projected expense is added to the HUD-1 at the beginning of the negotiations. Adding them after you have negotiated isn’t going to work. If you are having trouble making your mortgage payments and don't want to lose you home to foreclosure call me at 865-696-9002 or email me [email protected]. You do have options and my services to you are free.

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