Home Affordable Foreclosure Alternatives – HAFA

The Home Affordable Foreclosure Alternatives – HAFA

The Home Affordable Foreclosure Alternatives (HAFA) will give you the opportunity to gracefully liquidate your home when you can no longer afford to stay by using a couple of alternatives.  The first alternative would be a short sale…meaning your home will be listed and sold for less than the current unpaid balance.  The second alternative involves a Deed-in-Lieu (DIL) of foreclosure….meaning title and possession will be grant deeded back to your lender/servicer. 

Home Affordable Foreclosure Alternatives - HAFA

Upon completion of either alternative, your lender/servicer will grant a full release of your mortgage obligation.  This means you will not be held liable for any portion of the remaining balance of the loan.  The deficiency is guaranteed to be waived by the servicer.  In addition, the HAFA program provides a $3,000 relocation assistance.    To qualify for this program:

  • The property must be owner-occupied.
  • The mortgage must be a first lien originating prior to or on January 1, 2009.
  • The loan must be 60 days delinquent or default is imminent
  • The loan was previously evaluated for HAMP and non-HAMP modification
  • The loan must not be a FHA or VA loan
  • The property is not condemned

The property must not be vacant, unless the property has been rented to tenants up to 12 months prior to the short sale agreement. Documentation must be provided to evidence that the property was owner occupied as your property prior to relocation. The unpaid principal loan balance must be equal to or less than $625,500 for one unit.  Maximum loan amounts for 2-4 units owner-occupied are higher).  (Ref . the link here for High Cost Area (HCA) loan limits for 1-4 units).   No felony, larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction within the last 10 years.

NOTE:  VERY IMPORTANT If your property has been scheduled for a foreclosure sale, the short sale agreement must be requested 60 days prior to the foreclosure sale.

5. Home Affordable Foreclosure Alternatives – HAFAPlease be informed that prior to any foreclosure proceedings, your lender/servicer must comply with an Independent Foreclosure Review as mandated by the Office of the Comptroller of the Currency, The Board of Governors of the Federal Reserve System, and the Office of Thrift Supervision.  Read more.Did you Get an Independent Foreclosure Review.

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