Short Sale Telephone: 800-393-4887   |   Short Sale Fax: 866-234-9845

Sample Email Format for Assigned Party: Firstname.Lastname@flagstar.com

Required for Initiation

To initiate, fax:

  1. PSA
  2. HUD
  3. Buyer Pre-Approval/Buyer Proof of Funds
  4. Borrower financial information (see Doc Pac)
  5. Listing Agreement
  6. 4506T Form
  7. MLS Sheet
  8. 7 page RMA form
  9. Third Party Authorization

The Process

Flagstar assigns a Single Point of Contact from initiation through closing. The file is negotiated through two phases: Processing and Underwriting

  1. Processing: Collect additional documents, request document corrections, order appraisal, complete the file
  2. Underwriting: Respond to the offer, respond to investor fee caps, determine relocation incentive eligibility, request investor-specific requirements, determine cash contribution requirements

Timeline for Approval

  1. Manually fax the short sale package, wait for the documents to be uploaded (5-7 days)
    1. Note: Call 48 hours after the documents are faxed to confirm receipt
  2. Lender assigns SPOC (3-5 days)
  3. SPOC sends file to Processor (3-5 days)
  4. Processor reviews for corrections/additional document requests, orders BPO (7-20 days)
  5. Processors sends to underwriting with completed BPO (3-5 days)
  6. Underwriting reviews and responds to offer (5-10 days)
  7. Investor reviews and issues approval (5-7 days)

Four Lender Specific Tips

  1. Request SPOC email immediately: Customer service does not have access to the file notes and cannot provide a meaningful update. Request your SPOC’s email address and extension immediately.
  2. Investor approves bulk closing costs: Flagstar approval letters do not approve line item fees. Call to ensure your HUD matches the approved terms before closing.
  3. Follow-Up Constantly: Compared to other lenders, your SPOC is difficult to reach. Call every 48 hours until you are able to reach your contact for a meaningful update.
  4. Provide BPO Contact Immediately: Provide BPO contact information to your SPOC early.

Value Dispute Procedure:

Lender counters the offer higher than the parties believe the property is worth.

Lender Escalation Procedure

Compared to other lenders, escalations will likely be necessary with Flagstar:

If a file hasn’t been notated or moved in 7-days:

  1. Send an email to your SPOC and have customer service send and internal email requesting a response
  2. Wait 48 hours
  3. If no response, send email to your SPOC, have customer service send and internal email requesting a response
  4. Wait 48 hours
  5. Request to speak to a supervisor
    1. Note: Customer service is trained to prevent calls from going to a direct supervisor; be prepared to make the request 3-5 times

Closing Process

  1. Send final HUD for approval: Flagstar reviews for final approval of the HUD-1 Settlement Statement 48 hours prior to closing.
    1. Fax the HUD-1 to Closer
  2. Sign and Return Final Closing Materials: Flagstar issues closing instructions and requests signatures on the short sale approval letter, as well as other documents:
    1. E.g. Short Sale Arms Length Affidavit, HAFA Affidavit, Unearned Insurance, etc.
  3. Processing Tips:
    1. Include the loan number, property address, and lender name on the cover sheet for each fax
    2. Provide the seller’s forwarding address (usually asked for explicitly in the approval letter)

Approval Extensions

To request an extension of an approval:

  1. Reach out to your contact listed on the approval letter via phone to make request
  2. Fax the request in writing
  3. Call and email to follow-up daily until it is receive via fax