Have you heard about the updates to the Home Affordable Foreclosure Alternative (HAFA) program? Earlier this month, on March 9th, the Obama Administration announced updates to HAFA, a government-sponsored program to assist qualified distressed homeowners in avoiding foreclosure through short sales and deed-in-lieus. This new update will allow more distressed homeowners to seek assistance.
The updates will be effective as of June 1, 2012. Major changes to HAFA program include:
- Deadline for submitting for HAFA eligibility has been extended a full year, from December 31, 2012 to December 31, 2103.
- $3,000 relocation incentives are now limited to properties occupied by an owner or tenant at the time of the short sale.
- Mortgage payments may now be allowed to exceed 31% of the homeowner's gross monthly income. This update will allow homeowners to stay current on their mortgage and still qualify, minimizing the overall impact to their credit.
- Secondary lienholders are now being offered up to $8,500, up from the previous $6,000.
- Removal of occupancy requirements. Previously Hafa required homeowners to have lived in the property within the last 12 months.
- The Credit Bureau Reporting will now be Account Status Code 13 (paid or closed account/zero balance) or Code 65 (account paid in full/a foreclosure was started), as applicable.
Finally homeowners can be current on their mortgage and quailfy for HAFA! So many homeowners have wanted this option so they can stay current during the short sale process and help minimize the affect of a short sale on their credit. If you would like more information about short sales and HAFA, please visit my website at www.TheWestValleyHomeTeam.com.
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