USDA Does Not Give Full Release in A Short Sale

Breaking news! if you have a USDA loan you can do a short sale however they will only release the lien so the sale can be completed, they will pursue for a portion of the loss even if you have no income. 

The USDA short sale was one of the easiest lender's to work with to get the approval, even the approval letter is written in the verbage that states it will release the lien, but unfortunately after the transaction is completely over they do send a promissory note to the previous owner with an amount they want on it and requests their signature.

This is very deceptive, all the banks I have worked with have always been upfront in requesting a promissory note.  Also the USDA does not offer any relocation assistance and of course does not participate in the HAFA program.  You would think that it would follow the rules similiar to that of a government loan for the short sale process.

It is mind blowing that a government loan program does not offer any relocaton assistance, it does not completely release the borrower from the lien, and in my experience they would not perform the appraisal it was the borrower's responsibility to provide the appraisal to review the current  market value or they would use the last appraisal they had on file which would be the one from the initial purchase. Wow! no underwriter would approve a loan based on an appraised value that is five years old.

Here is the bottom I have contacted the state representative and voiced my concern and I will continue, I mean why would anyone with a USDA loan want to short sale, the outcome is the same for them, they are still liable for the debt the government will even keep their income tax return to collect the monies.  So if you have a USDA loan and need to do a short sale, speak out to your state representative so that a change can be made.


Thinking about a short sale? I can help you short sale your property and get back on your feet. Send me an e-mail at :phillis@txhomerealty.com. I will contact you for a free consultation.

When we talk, I will explain how the process works in detail and answer any questions you may have. Or, if you prefer, you can call me at (214) 650-5536

Discover how other sellers successfully completed a short sale and request a free consultation by filling in the contact box to the right or you can call me directly at 214-650-5536.

Thanks for reading this, Phillis Nealy.

Phillis is a Real Estate Agent at The Texas Group Realtors.

Phone: (214) 650-5536.:phillis@txhomerealty.com.

A Realty company with Service as Big as Texas

View My homes for sale at http://www.txhomerealty.com/

Phillis Nealy specializes in loan modification assistance and short sales in the Dallas Metroplex..

Because most short sales are beneficial to a lender. If you accept our offer to help you on a short sale, your lender may not agree to a short sale or to modify your loan. We do offer a loan modification kit.

However, the likelihood of negotiating a modification is like everything else in life. It takes work and persistence to convince your lender to modify your loan. No matter what you or we do, your lender may not approve a loan modification.

We do not recommend that you stop paying your mortgage, because this will cause damage to your credit and could cause you to lose your home. Because we know avoiding foreclosure is so important to any homeowner, we recommend that you speak with the appropriate legal or tax advisor before making any decision.

This is not intended as legal, technical, or tax advice. Please speak with a licensed professional before making any decision. Information is deemed reliable but not guaranteed as of the date of writing.

You have the option to reject a short sale or loan modification from your lender if it does not meet your approval. If you decide not to go thru with the short sale, then you do not have to pay us our fee. We normally make a real estate sales commission for helping you on a short sale.

This information is provided as a courtesy for professional advise consult with an attorney.