What is a HAFA Short Sale?

The bank will give you $3000 to short sale and move!

 

The rising number of foreclosures in this country is simply too big to ignore. That is why a government-backed program has been released that aims at streamlining foreclosure avoidance options. Short sales and deeds-in-lieu are dignified solutions to foreclosure, and now the government is making them easier, quicker and more accessible through the Home Affordable Foreclosure Alternatives Program, or HAFA. The rising number of foreclosures in this country is simply too big to ignore. That is why a government-backed program has been released that aims at streamlining foreclosure avoidance options. Short sales and deeds-in-lieu are dignified solutions to foreclosure, and now the government is making them easier, quicker and more accessible through the Home Affordable Foreclosure Alternatives Program, or HAFA. With one in six homeowners struggling to make mortgage payments, you are not alone, and there are options available. With the free report provided here, find out if you qualify for the HAFA Program. Simply fill out your information to the right to get started on your new chapter of financial stability. HAFA, or the Home Affordable Foreclosure Alternatives Program is a government sponsored initiative to aid eligible homeowners by pre-approving short sales before listing and releasing them from future liability of mortgage debt. Most homeowners facing financial hardship are eligible for a HAFA. As a rule, if a homeowner is eligible for HAMP but cannot pay the mortgage, then he or she is eligible foran assisted short sale through HAFA. Your real estate agent can request a HAFA short sale on your behalf. For a loan to qualify, it must meet the following criteria:

• The property is the borrower’s principal residence
• The mortgage loan is a first lien mortgage originated on or before January 1, 2009
• The mortgage is not owned or guaranteed by Fannie Mae or Freddie Mac
• The mortgage is delinquent or default is reasonably foreseeable
• The current unpaid principal balance is equal to or less than $729,750
• The borrower’s total monthly mortgage payment exceeds 31 percent of the borrower’s gross income (as defined in HAMP Supplemental Directive 09-01)

HAFA is the only program that gives you cash for avoiding foreclosure through a short sale or deed-in-lieu of foreclosure. If you complete a short sale or deed-in-lieu, then up to $3,000 in Borrower Relocation Assistance may be available to aid in your transition.

The biggest gain of HAFA, however, is that it helps you get your life back if you feel like there are no other solutions when faced with foreclosure.

What’s in it for the Homeowner?

Foreclosure will be avoid and maybe able to purchase in a 1-3 years depending area.

Why Would my Lender Participate in HAFA?

Lenders and servicers receive $1,500 in administration and processing fees for each successful short sale transaction under HAFA guidelines Servicer may not charge borrower any processing fees and MUST pay all out-of pocket expenses

If I Have More Than One Lien Holder, Why Would They Release My Debt?

Under HAFA, subordinate lien holders receive up to $6,000 to release liens.

What Motivates Investors to Buy a Short Sale?

Investors are given $2,000 for subordinate lien holder payoff as well as a great deal on a properly maintained property For every three dollars spent to release liens (up to $6,000) investor is reimbursed one dollar (up to $2,000)

Although the HAFA program is aimed to simplify the short sale process, HAFA itself, can often be a difficult and confusing process to understand.

Here are just a few things to keep in mind when considering:

HAFA as an alternative to foreclosure: The lender waives rights to seek a deficiency judgment, absolving the borrower of their debt.

The servicer must assess the property value and cannot charge the borrower in advance.

Servicer must notify borrower of short sale and deed-in-lieu as foreclosure avoidance alternatives, acting in the borrower’s best interest and seeking a final resolution It is a requirement that the property be listed with a licensed real estate professional.

If a servicer is not in compliance with the HAFA guidelines, issues with the servicer should be addressed by the participating agent, not the homeowner

• A licensed agent is considered a HAFA “trusted partner” and is able to work through the proper channels until the issue has been resolved Although a borrower may be eligible for the HAFA program, there are a couple of situation sthat would cause the borrower’s participation in the HAFA process to be terminated.

They are listed as follows:

1. Borrower’s financial situation improves

2. Borrower or listing broker fails to act in good faith in listing, marketing and closing the sale

3. Significant change occurs in property condition or value

4. Misrepresentation or fraud

5. Borrower files for bankruptcy

6. Litigation is initiated or threatened that would affect the title (i.e. divorce) What are the “Alternatives” in HAFA? HAFA provides two alternatives that will allow you to avoid foreclosure:

• Short Sale – If you owe more on your home than it is now worth, a short sale will help you sell your home and save yourself from financial ruin. According to HAFA, a real estate agent must be involved in this process.Agents with the CDPE designation are specially trained to help you with a short sale.

• Deed-In-Lieu– This is where the bank accepts the deed of your home instead of (“in-lieuof”) foreclosure. You do not get to keep your home, but your mortgage debt is forgiven.

What is foreclosure?

If you are in a financial hardship or cannot make payments on your home, the bank can take your home away from you through a foreclosure, which leaves your credit horribly damaged, your security clearance compromised (if applicable), challenges your present and future employment,and you may still owe money to the bank. It’s a nightmare situation that has been happening to millions of Americans. HAFA has been created to provide alternatives to foreclosure, and CDPE designated agents are here to help.

Why should I consider a HAFA short sale?

HAFA sets distinct guidelines and incentives for banks and lending companies so that you will know whether or not you can complete a short sale.

One of the common myths about short sales is that they take forever to complete.

HAFA makes sure that short sales happen more quickly bystreamlining the short sale process.

How is HAFA different from a short sale?

The main issue with traditional short sales was that they took too long, and it was difficult to keep buyers interested in the process.

HAFA is a program designed to speed up the short sale process and even gives banks incentives for each short sale they do.

Also, after completing a HAFA short sale, you may be given up to $3,000 in Borrower Relocation Assistance to help you transition.

What’s in it for me?

HAFA is the only program that gives you cash for avoiding foreclosure through a short sale or deed in-lieu of foreclosure.

If you complete a short sale, then up to $3,000 in BorrowerRelocation Assistance may be available to aid in your transition.

This program seeks to ensure that no one will be left high-and-dry if they cannot afford their home. The biggest gain of HAFA,however, is that it helps you get your life back if you feel like there are no other solutions whenfaced with foreclosure.
If you have any questions or comments, please post below or contact me at the following :
Dale Frisch 612-284-8161 or Dale@AttractiveRealty.com

We are not lawyers or tax accountants and you should always seek the advice from a professional
regarding legal or tax questions.

For a Free legal consultation on Real estate matters, Short Sale/ Foreclosure or Bankruptcy

Contact Nathan Nelson with Virtus Law PLLC 763.432.2169 Or Info@virtuslaw.com

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