The details’ regarding new HAFA protocol for short sales was revealed in a recent interview with Laurie Maggiano, the director of policy of the US Treasury. The Federal government established the MHA (making home affordable) program which is responsible for creating guidelines regarding loan modifications, HAFA short sales and foreclosure prevention.
Freddie, Fanny and the US Treasury all had different processes for short sales. These variations created unnecessary work for agents and sellers adding further frustration to an already stressful situation.
The MHA program established a uniform process for all short sales by encouraging compromises from Freddie, Fanny and the Fed. Most notably was Fanny and Freddie’s adoption of: paying relocation incentives, releasing some seller liability, abolishing upfront fees and putting a larger focus on pre-approvals. The US Treasury reciprocated by eliminating most of the tedious paperwork and creating a “streamline,” to expedite the short sale process. Also, the fed now offers to pay up to $5,000 in an effort to increase incentives for investors to pay off subordinate lien holders.
The program has helped over 1 Million homeowners dodge foreclosure and is set to expire Dec. 31, 2013.
To see the full interview regarding all short sale changes that agents must know, click here.
Our company LMN will regularly discuss topics like this to ensure that you and your team are up-to-date and relevant on all things short sale.