Fannie Mae announced on Tuesday its own version of the Home Affordable Foreclosure Alternative (HAFA) program to apply to all conventional mortgages held in Fannie's portfolio, that are part of a qualified mortgage-backed security (MBS) pool, or are part of a shared-risk security pool marketed by Fannie Mae. The program will take effect on August 1, 2010 and will terminate on December 31, 2012. Like the Treasury's HAFA program, it is designed to further help those that were eligible for -but have failed to complete- a modification under the Home Affordable Modification Program (HAMP). In other words, the borrower must first be considered for a HAMP workout.
The latest in a string of loan workouts created to assist borrowers in avoiding foreclosure, Fannie Mae's HAFA program offers incentives to borrowers and lenders to successfully execute short sales or deeds in lieu of foreclosure (DIL). The cash incentives for completed HAFA transactions include $3,000 for the borrower, $2,200 for short sales and $1,200 for a deed-in-lieu agreement to the servicer. The Treasury's HAFA only offers servicers and investors $1,000 each. It's not clear to me if the Fannie Mae HAFA program offers an incentive for the loan investor.
In addition, Fannie Mae will offer a deed for lease program (D4L), which will allow some borrowers stay in their home as renters. The borrower will be able to stay in their homes as renters and must be able to sustain a 31% rent-to-income ratio.
Any other details I have neglected to mention, please comment. I think this is pretty exciting stuff, not to mention long-awaited.
If you have a Fannie Mae loan and are suffering a hardship....divorce, job loss, job relocation, an increase in expenses, reduction in income, your mortgage is upside down and you don't know what to do- Please give me a call or visit my site at http://MercedesTucker.com or http://SacAreaShortSales.Info.
If you don't have a Fannie Mae loan and you'd like to know if you qualify for the Home Affordable Foreclosure Alternative, there is a link on my site that will determine your eligibility (top right-hand side of the home page.)