Home Affordable Foreclosure Alternatives Program (HAFA)coming April 5th
The following information was sent to me by Stephanie E. Reimann of Bank of America loan officer in my office.
Many of you have asked me to give a brief overview of the upcoming program by the Treasury Department called HAFA beginning April 5th.Their main goal is to streamline the short sale process for those Borrowers who cannot afford to keep their home and gives them an alternative to foreclosure.They plan to accomplish this is by standardizing the process across all Servicers, minimizing turn times for a decision and standardizing the documentation required by the Borrower to the Servicer .This Program will impact only those owner occupied loans up to $729,750.While Fannie Mae & Freddie Mac have also agreed to participate , they will be initiating their own Program but one that will mirror HAFA.In all cases the homeowner will select the Listing Agent to represent them & facilitate them during this Short Sale Process.
HAFA Rules:
1). Standard rules apply for Listing, Pricing & accepting Short Sale Contracts
2). Listing Periods up to 120 days at a set sales price
3). Cash incentive payments for those Borrowers & Servicers that participate
$1500 to Borrowers to relocate
$1000 to Servicers to cover administrative fees
up to 3% of the outstanding loan balance for Junior lien holders
4).Prohibits Servicers from reducing the Realtor commission agreed to in the Listing Agreement-up to 6% maximum
5).Provides a 90 days resale restriction to prevent prevent flipping
6).Requires Borrowers be fully released from future liability for 1st mortgage debt-no cash contribution,promissory note or deficiency judgments allowed at Closing
HAFA Forms:
Short Sale Agreement (SSA) Form.This Agreement is 7 pages in length & outlines the responsibilities of the Servicer & Borrower in the Short Sale Process,provides the Servicer with the net acceptable amount & provides for the duration time that the SSA will be in effect.
Request for Approval of a Short Sale (RASS). This form is submitted to the Servicer within 3 days once an Offer is received, provides the Terms & Conditions of the Short Sale, provides Closing Instructions to the Attorney, provides a HUD1 mock up & requires that the Contract be accepted or rejected within 10 days.If denied they must state the reasons why.
Bank of America participation:We will fully participate in the HAFA Program & will implement these through the web based portal called Equator.This System will allow real estate professionals & homeowners to track their short sale progress 24 hours a day & seven days a week.In real time this will allow all to see & exchange documents,track important dates & deadlines.Our dedicated Customer Support Team can be reached at 866-880-1232 to answer any questions.An Escalation Team has been put in place should the Negotiator not respond in a timely basis.Their hours will be expanded soon to include evening & weekends ! We will be hosting a Webinar, tentively set for April 8th,for our Real Estate Agents because they will be key to our success with HAFA. Once the date is finalized,the registration process will include the ability to submit questions to be answered during the Webinar. As soon as I know more, I'll pass this on to you.
If you are interested in listing your home as a short sale please contact Kim Darwaza of RE/MAX Allegiance your Northern Virginia Short Sale expert at 703-856-2254. Please visit http://www.novaforeclosurerelief.com for additional information on the short sale process in Northern Virginia.