The treasury department has initiated another overhaul of the HAMP (Making Home Affordable Program) which includes changes to the HAFA (Home Affordable Foreclosure Alternative) Program. This is the part of the program that oversees Short Sales as an alternative to Foreclosure. HAFA is the government initiated program that allows a distressed Homeowner who qualifies to receive a $3,000 Relocation Incentive as well as guaranteed relief from any deficiency judgement for the amount that the lender loses in the Short Sale process.
Under the new guidelines which officially begin Feb. 1, 2013 there will be a more simple process and less documentation required. This should result in more successful Short Sales closing in a Shorter period of time.For more of the specifics or for assistance with a Short Sale contact an experienced Short Sale Specialist Realtor. Here is a Summary of a few of the Before and After comparisons.
HAFA Changes Supplemental Directive 12-‐07
Before Feb. 1, 2013
- Use of SSA (Short Sale Agreement) and RASS Request for Short Sale Approval documents mandatory
- Servicers required to respond within 45 days
- Affidavit of borrower hardship required for approval of HAFA short sale
- The arms length transaction or HUD-1 affidavit required
- Treasury contribution to subordinate lien payoff $2,000
- No resale before 90 days
After Feb. 1, 2013
- Use of Short Sale Agreement and Request for Short Sale Approval documents optional
- Servicers required to respond within 30 days
- Pre‐determined hardship (90 plus days delinquent and FICO below 620) with affidavit required
- New Short Sale Affidavit to be completed at closing
- Treasury contribution to subordinate lien pay off increased – up to $5,000
- Resale after 30 days allowed
More info about HAFA changes to come in future posts. Post 1 of 5 on this subject.