Is the New HAFA Short Sale Program good for you?

Is the new Home Affordable Foreclosure Alternatives Program (HAFA) good for you? If the thought of foreclosure or Short Sale has ever crossed your mind then you will want to know more about the new HAFA program rules.

Let’s start with a quick definition of a Short Sale. In brief, a Short Sale is when the lender allows the borrower to sell their home for less then is owed by the lender. It is very important to note that some lenders forgive the balances owed while others require some sort of repayment. It is critical to do the following:

Speak with a Real Estate attorney who can guide you on your state laws. Real Estate laws vary state to state.

Hire an experienced Short Sale Realtor. This Realtor should have taken an advance Short Sales workshop such as CDPE (Certified Distressed Property Expert) in addition to his or her Realtor courses. You also want to hire someone who has a strong track record of dealing with lenders. I can’t over emphasize this enough, hiring the right people from the beginning will make all the difference in the world when trying to close a Short Sale.

So, what’s in this new HAFA program for those who are considering selling their home as a Short Sale;

1. The HAFA program puts timelines on both the borrower and lender. This is huge! I’ve heard horror stories of Short Sales taking 6 months to a year to close. Can you image putting your life on hold for a year while a bank shuffles your paperwork from one desk to another? This program requires the lender to reply in weeks not months. It also allows borrowers to become preapproved before placing their house on the market. This is a great selling point when you put your home on the market!

2. Requires borrows to be fully released from further obligation. This means that the bank will not come after you after you close on your home.

3. New financial rewards for both the borrower and lender to play ball. The borrower will get $3,000 for moving expenses and the lender will get $1,100 to help offset processing costs.

4. Allows money from the proceeds to be paid to the 2^nd trust. In most cases the 2^nd trust gets nothing or very little and hence tends to hold up or slow the closing process.

Here are some quick links to more information on the HAFA program:

HAFA Program outline PDF

NAR HAFA information

Want to know more about this program? Want to set up a confidential meeting to discuses your particular needs? Call or email me now!

Chuck Rifae

Serving all of your Ashburn, Leesburg, Mclean and Loudoun County area Real Estate needs!