HSBC / HFC Financial / Beneficial Bank

Short Sale Telephone: 800-348-4712   |   Short Sale Fax: 866-860-8826

Note: HFC Financial and Beneficial Bank are subsidiaries of HSBC. Short sales with each lender are negotiated with HSBC’s short sale department.

Required for Initiation

To initiate the process, 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

The Process

HSBC negotiates through fax and phone. There are three different phases to HSBC short sales: Processing, Negotiating, and Closing.

Processors: Collect additional documents, request document corrections, order appraisal, complete the file

Underwriting Team: Reviews documents for borrower financial eligibility

Negotiators: Respond to the offer, respond to investor fee caps, determine relocation incentive eligibility, request investor-specific requirements, determine cash contribution requirements

Closers: Review final closing documents; the closer will be your negotiator.

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 Processor, Processor forwards to Underwriting Team (3-7 days)
  3. Underwriting team reviews documents for financial eligibility, and orders BPO. Processor communicates additional document requests/clarifications needed by Underwriting (5-15 days)
  4. Processor forwards to Negotiator with completed BPO
  5. Negotiator reviews and responds to offer (5-15 days)
  6. After agreement on terms, negotiator submits to investor for final approval
  7. Investor issues approval letter, negotiator sends to borrower representative with closing instructions (5-10 days)

Four Lender Specific Tips

  1. Loan Number on Every Page: HSBC requests all faxes have the loan number on every page of every document. Ensure submitted documents are processed as quickly as possible by putting the loan number on each page of every fax.
  2. Manage Closing Cost Expectations: HSBC will generally only approve a maximum of 5% commission and 3% buyer’s closing cost credits. Manage parties’ expectations early in the process about HSBC’s fee policy.
  3. No 48-hour final HUD-1 approval: Unlike other lenders, HSBC does not review the HUD-1 Settlement Statement 48 hours prior to closing. Save time; send the signed closing docs after closing.
  4. Provide BPO contact early: HSBC orders their BPO as soon as they receive initiation documents. Provide BPO contact information immediately.

Value Dispute Procedure:

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

  1. Respond to lender's counter with the buyer's highest and best
  2. Provide an independent appraisal or full agent MLS sheets for three comparable sales (providing all characteristics), and if available, three active comparable property MLS sheets
  3. Provide a CMA report
  4. Comparable requirements:
    1. Closed sales no more than six months old
    2. Similar in size, age, condition and characteristics
    3. Within one mile proximity of the subject property; OR
  5. If there are Repair/Hazard Issues:
    1. Provide a line item repair estimate from a licensed contractor or engineer on business letterhead with the costs to cure the damage
    2. Provide photos of the damage
      1. Note: Excessive photos will be rejected
      2. Place photos in a zip file if sending more than three
  6. Time given to provide documents for value dispute: 24-48 hours
  7. Potential wait time for value dispute results: 2-4 weeks
    1. Note: This time can be expedited if you provide a complete dispute package and follow-up every 2-3 days.

Lender Escalation Procedure

If more than five days have passed without movement on your file:

  1. Call Customer Service in the short sale department
  2. Request they email the Processor or Negotiator for a response

Wait 48 hours, if no response:

  1. Call Customer Service in the short sale department
  2. Request to speak with a Supervisor
  3. Request they email your assigned party and your assigned party’s supervisor stating you have not received a response for 7 days (the first 5 + 2 days after the first phone call)

Closing Process

  1. No Final HUD-1 Approval: HSBC does not issue final HUD approval; as long as the parties comply with the approved terms, HSBC does not require final HUD approval.
  2. Sign and Return Final Closing Materials: Upon approval, HSBC issues closing instructions and requests signatures on final closing documents:
    1. HUD signed by Seller(s) and Buyer(s)
    2. Wire Confirmation
    3. Notarized Approval Letter
  3. Processing Tips:
    1. Include last name and loan number in the subject line of all email correspondence
    2. Include a forwarding address for the seller
    3. Put loan number on all documents sent to Negotiator

Approval Extensions

To request an extension of an approval:

  1. Reach out to Negotiator
  2. State your extension request including the intended closing date and the reason the extension is required
  3. Call and email to follow-up