Summary of HAFA Advantages
- Uses borrower financials and hardship information already collected in connection with consideration of a loan modificiation
- Allows borrowers to receive pre-approved short sale terms before listing the property (including the minimum accetable net proceeds).
- Requires borrowers to be fully released from future liability for the first mortgage debt (no cash contribution, promissory note, or deficiency judgement is allowed). Second Mortgage holder is not obligated to comply with HAFA.
- Uses standard processes, documents, and timeframes/deadlines.
- Provides financial incentives: $3,000 for borrower relocation assistance; $1,000 for servicers to cover administrative and processing costs; and up to $1,000 for investors for allowing a total of up to $3,000 in short sale proceeds to be distributed to subordinated lien holders (on a one-for-three matching basis).
- Requires all servicers participating in HAMP to implement HAFA in accordance with their own written policy, consistent with investor guidelines. The policy may include factors such as the severity of the potential loss, local markets, timing of pending foreclosure actions, and borrower motivation and cooperation.
For more information regarding ways to avoid foreclosure or if you would like to find out the advantages of a short sale please visit www.discovershortsale.com or contact The Discover Short Sale Team at info@discovershortsale.com / 877-736-2299.
http://www.discovershortsale.com/Short-Selling-Your-Home/Government-Sponsored-Short-Sale
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