Short Sale Transactions to get easier April 5th

Mortgage and Lending with - Legend Lending NMLS #293883

HAMP(also known as HAFA) stands for Home Affordable Modification Program.  HAMP has addressed new rules for short sale transactions that are owned by banks(not Fannie Mae and Freddie Mac).  Keep in mind HAMP has been a failure for helping home owners modify their current mortgage, so far.  Lets hope this program makes short sale transactions easier.  Here are the new rules(guidelines):

  • Uses borrower financial and hardship information already collected in connection with consideration of a loan modification.
  • Allows borrowers to receive pre-approved short sales terms before listing the property (including the minimum acceptable net proceeds).  This should make life much easier!
  • Prohibits the servicers from requiring a reduction in the real estate commission agreed upon in the listing agreement (up to 6 percent).
  • Requires borrowers to be fully released from future liability for the first mortgage debt (no cash contribution, promissory note, or deficiency judgment is allowed).
  • Uses standard processes, documents, and timeframes/deadlines.
  • Provides financial incentives: $1,500 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 subordinate 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.
  • Requires the bank to respond to all offers within 10 days. 

The program does not take effect until April 5, 2010.  The program ends on December 31, 2012.  Another great piece of information from Dave Your Mortgage Guy.  Please call me with any questions. 

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David Krichmar 

Mortgage Banker NMLS#293883 

Legend Home Lending

LLC NMLS #229421

Has Written For Realtor Magazine, Houston Agent Magazine, Scotsman Mortgage Guide

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Named 5 Star Mortgage Professional 2013, 2014, 2015, 2016, 2017

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Re-Blogged 6 times:

Re-Blogged By Re-Blogged At
  1. Joe Hansen 03/23/2010 05:48 AM
  2. Damon Gettier 03/23/2010 06:04 AM
  3. Stephen Kendrick 03/25/2010 01:36 PM
  4. Roy Kelley 03/25/2010 01:38 PM
  5. Robert Snyder 03/29/2010 06:35 AM
  6. Robert Snyder 03/29/2010 06:39 AM
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Jeremy K. Frost
Keller Williams Realty - Dripping Springs, TX
Associate Broker, CNE, CRS, ePro, PSA



Thanks for sharing this valuable information. It's posts like this that make active rain great!

Mar 23, 2010 05:44 AM #1
Team Honeycutt
Allen Tate - Concord, NC

Thanks for this information it should really help everyone who is struggling in this economy right now!

Mar 23, 2010 05:47 AM #2
Damon Gettier
Damon Gettier & Associates, REALTORS- Roanoke Va Short Sale Expert - Roanoke, VA
Broker/Owner ABRM, GRI, CDPE

I found this from a reblog and I will be reblogging also.  Thanks for the information.

Mar 23, 2010 06:00 AM #3
Robert Snyder
Silex Financial Group, Inc. - Madison, NJ
a.k.a. Bob the Broker, host of The Real Deal

Dave this is great stuff.  Thanks.

Mar 24, 2010 03:59 AM #4
Don Wixom
RE/MAX Executives Nampa, ID - Nampa, ID
"Looking out for your next move..."tm

Dave, thanks for the quick summary! This is great information for agents & borrowers!

Mar 25, 2010 02:01 PM #5
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