VA Compromise Sale Program Offers Cash To Distressed Military Homeowners 
$1500 Paid At Closing

Alexandria VA Short Sales - The Alexandria VA real estate market has made it tough for some military homeowners who are upside down on their mortgage to sell their home. The Department of Veteran Affairs has recently authorized a cash incentive of $1500 to homeowners who successfully complete a VA Compromise Sale. 

What is a VA Compromise Sale?  A VA Compromise sale is when the sale of your home is not enough to cover your VA mortgage balance.  As the borrower, you can request a claim from the VA to pay the short amount that will cover what is owed on the mortgage.  The mortgage lienholder is paid in full and the property is sold to the new purchaser with the lien fully released.

The $1500 incentive is shown on the HUD-1 settlement statement at closing, so the credit to the seller is not paid prior to the sale.  Much like the federal government's HAFA short sale program where distressed homeowners can receive up to $3000, the VA Compromise Sale has guidelines:

  • The property must be sold for fair market value.
  • The closing costs must be reasonable and customary.
  • The compromise sale must be less costly for the Government than foreclosure.
  • There must be a financial hardship on the part of the seller.
  • On loans that originated on or before December 31, 1989, the seller must be willing to sign a
    promissory note.
  • There must be no second liens or other liens (unless the amount is insignificant). In
    situations whereby there are second liens or other liens, the seller can request that the
    lienholder consider releasing the lien and converting the loan to a personal loan.
  • The seller must first obtain a sales contract in order to be considered for the program.
  • To protect the seller’s interest, the seller should make the sales contract contingent and/or
    subject to the approval of a VA compromise sale
    .
  • Once it is determined that a homeowner may qualify for VA compromise sale, the realtor or the
    homeowner should contact the homeowner’s lender and/or the VA.

Commonly asked questions from military homeowners considering a VA Compromise Sale:

  1. How do I find out the market value of my home? Part of our service including providing a comparative market analysis, which is a report of the sales activity in your neighborhood.  This will show what homes have sold for, and how long they stayed on the market.  With a VA Compromise Sale, a VA appraisal is ordered by the mortgage lender.  The VA will likely not approve a sale that is less than the VA appraised value.
  2. What if I do have a second lien?  Approval of a second lien will be on a case-by-case basis by the VA.  If there are large additional liens on the property, we will help you negotiate an arrangement with the lienholder so that the property can still be sold.  This may include negotiating a short payoff, or a promissory note.
  3. What if I owe past due condo fees or HOA fees?  Contact the HOA or condo association immediately to find out the total amount due, and start making arrangements to bring your account current. The VA will likely not pay any money towards delinquent condo or HOA fees.  Associations have the authority to place a lien on your property and may also start the foreclosure process.
  4. If I sell my home with a VA Compromise Sale, can I use my VA loan again?  Yes, but only after you have paid back your entitlement.

 If you are a military homeowner and have received your PCS orders to leave the Pentagon, Fort Belvoir, or Quantico, please call me at 703-623-8759 to see if you are eligible for the benefits that may help you if you need to sell your home.

Contact A Short Sale Specialist Today