This is a continuation in our discussion of FHA specific questions about a short sale.

Question: If the 120-Day Pre-Foreclosure Sale Period for an FHA Short Sale expires, are there any other options available?

Answer: Possibly. If, after a good faith effort, an acceptable Purchase Offer is not obtained within the 120-Day Pre-Foreclosure Sale Period, most lenders will, upon request, allow extensions in 30-day increments. If these extensions expire and there is still no Purchase Offer on the property, the lender will possibly accept a Deed-in-Lieu of Foreclosure. A Deed-in-Lieu is less desirable than a Short Sale on a homeowner’s credit record, but is looked upon more favorably than a foreclosure. The homeowner must be approved for this program. If the homeowner decides to participate in this program, FHA will also pay a Seller Incentive. For more details about the Seller Incentive, we encourage you to discuss this with the Loss Mitigation Representative you are working with. Note: There are no broker commissions available if the homeowner chooses to do a Deed-in-Lieu of Foreclosure.