Pam Marron Home Lending

Were you denied a mortgage after a short sale because of erroneous foreclosure coding?


How many short sellers are disqualified for a new mortgage because their credit is incorrectly coded as a foreclosure? Tampa Bay Loan Officer needs your answers now!

New Port Richey, FL (Nov. 28, 2012) – Pam Marron, a mortgage loan officer for 27 years, wants to hear from past short sellers across the United States. She is working with the Consumer Financial Protection Bureau (CFPB) on the problem that erroneous short sale credit, most often reported as a foreclosure, poses for past short sellers.

“Short sales are often reported as a foreclosure on consumer credit, resulting in a mortgage loan denial years after the short sale. Past homeowners who end up selling short don’t even know this is on their credit until they apply again for a mortgage. It is incredibly difficult to get this corrected, is costly to fix, and results in further delay for these consumers to get back into the real estate market,” commented Marron.

Now the CFPB is taking a look at the problem. In addition to investigating where the credit code problem originates, the question was posed during a recent conference call asking how many people are being disqualified for a mortgage because of this problem.

“I told them I would get the numbers,” she added, and that is why Marron needs emails and calls from past short sellers, lenders who have encountered this problem, including credit reporting agencies, credit restoration companies, other lenders and attorneys. She recently attended the National Credit Reporting Association (NCRA) conference and made a presentation that showed where the wrong codes are found and the mortgage denials that come directly from Fannie Mae. She revealed how the codes were corrected and how Fannie Mae mortgage loan approvals were the result.  

“I was able to connect with many mortgage credit peers who are experiencing the same problem and did not know there was a way to fix this,” noted Marron. Then she connected with a CFPB official at the conference and has been in communication since. “There are 16 million underwater homeowners nationwide who are at risk of being negatively impacted when they apply for consumer credit or a mortgage because of this problem. We need to get this fixed so that these folks are not locked out or prolonged from re-entering the housing market,” said Marron.

So what’s the solution?

“The short term fix is to require that banks provide a letter to short sellers upon closing simply stating ‘This loan closed as a short sale. Any codings or markings on the credit report reflective of a foreclosure should be deleted,’” she said. Marron states that this language on bank letterhead often fixes the problem.

“The long term solution is a specific short sale credit code. The NCRA along with a few credit reporting agencies and the CFPB are looking at aspects of this problem now.” It was on a conference call this week with all of the above parties that the question was asked: How many short sellers are disqualified for a mortgage because their credit is incorrectly coded as a foreclosure?” Marron told the group she would go after the answer.

She’s asking that any past short sellers, lenders, credit reporting agencies, credit restoration companies and attorneys who have had this problem send their answers to or call Ms. Marron directly at 727-375-8986.   

For nearly two years Pam Marron has been investigating the distressing banking practice that causes homeowners to default.  She has discovered that this practice has been at the expense of underwater homeowners, so she has been working with Florida State and Federal Representatives, the U.S. Treasury Department, the Consumer Financial Protection Bureau and major credit reporting agencies to create solutions for this complicated problem.