HAFA (Home Affordable Foreclosure Alternative Program) is the newest government housing stabilization program that allows struggling homeowners to short sell their home within guidelines and is an extension of the HAMP (Home Affordable Modification Program.)  The HAFA program mandates the banks abide by the following rules in regards to a short sale transaction.

1. A bank/servicer must consider a borrower/seller for a short sale within 30 days after the borrower:
  • Does not qualify for a trial modificatin plan
  • Does not successfully complete modification trial plan
  • Misses 2 modification mortgage payments
  • Requests a short sale approval or a deed in lieu of foreclose
2. If borrower and property qualify, the servicer/bank sends out the short sale agreement:
  • Borrower/seller has 4 months to sell their home and may be extended for 1 year
  • Once an offer is received the service/bank has 10 days to approve or not and must allow 45 days to close the transaction
3.  The benefits to a HAFA approved homeowner/seller are:
  • Avoids the uncertainty of foreclosure
  • The seller is NOT required or allowed to contribute any monitory sums to the sale, including a personal promissory note or deficiency judgment, if the first and/or second lien holders accept the government paid incentives
  • The terms are “pre-approved” – therefore giving the homeowner a sense of relief that there is time to find a new place to live
  • The seller is given $3,000 to get back on their feet
  • Foreclosure may NOT be completed if the seller/borrower is performing under the “Short Sale Agreement”
  • Mortgage insurers must approve and waive their right to collect additional sums from the seller/borrower
  • If you have a 2nd mortgage, the first mortgage holder is given greater compensation from the government if they give the 2nd lien holder $6,000 or 6% cap per 2nd lien.
I understand this is a lot of information to digest, yet that is where I can help you!! On top of the new HAFA rules, Fannie Mae and Freddie Mac will be adopting a variation of HAFA rules for mortgages they own or guarantee. 

Most homeowners have no idea if Fannie Mae or Freddie Mac owns their loan, but this is just another area where I can help put the pieces of the puzzle together for you!
My goal is to help you and your family make the BEST CHOICE on which way to turn while you are experiencing financial difficulties. 

If you want to keep your home I make sure you have explored the loan modification option.  If you are just plain tired of the ups and downs and want to move on, I can help determine what your options are.