People with a VA loan often ask if they are eligible for a short sale. The answer is yes. A VA Short Sale is called a VA Compromise Sale. The Department of Veterans Affairs publicly releases copies of the Compromise Sale Guidelines. We usually list the property for sale and then submit all the short sale paperwork after a contract is accepted by the seller.

The lender will order a VA Appraisal. All the appraisals go through a VA Loan Center. There are nine Regional VA Loan Centers as of today. After the appraisal is done, I always call the local VA Loan Center. I fax them a request for a copy of the appraisal.

Upon receipt of my request they fax me a full copy of the appraisal. I can see everything on the appraisal. All the comparable sales they used, etc. I love it because it makes the short sale process more transparent. Now if only we could get Fannie Mae & Freddie Mac to do the same thing! If I think the appraisal has inaccuracies, I can request a dispute. Most of the Loan Centers have an appraiser on staff that handles disputes. 

Here is how to find out if you have a VA Loan. On the mortgage recorded in the public records, usually 1-4 pages past the signature page will be a VA Rider. At the top, it will say, "NOTICE: THIS LOAN IS NOT ASSUMABLE WITHOUT THE APPROVAL OF THE DEPARTMENT OF VETERANS AFFAIRS." The page for the VA mortgage was two pages below the original signature page of the mortgage. The pages between this and the signature page had the notary signature and the legal description.

These are fairly simple short sales. They are tougher than others because VA will not accept a sales that nets them less than 88.13% of the VA appraisal. I don't think they allow exemptions. I don't know because I have never asked for one. The lenders are not delegated, at least not in my experience. The process is the lender assembles a package and submits to VA. Will I get a Deficiency Judgment on a VA Short Sale? They will give a complete release if a seller participates in the short sale program.

But the borrower has to pay back the loss to be eligible for a VA loan again in the future. 

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