Short Sales made easier under HAFA program

On Monday, April 5th, Obama administration released new federal program meant to prevent more foreclosures in the U.S. Under HAFA (Home Affordable Foreclosure Alternatives), homeowners who are unable to retain their home, will get help with short sale process.

The program allows borrowers to receive pre-approved short sales terms before listing the property (including the minimum acceptable net proceeds and acceptable closing costs).It also requires borrowers to be fully released from future liability for the first mortgage debt (no cash contribution, promissory note, or deficiency judgment is allowed). HAFA also provides financial incentives: $3,000 for borrower relocation assistance; $1,500 for servicers to cover administrative and processing costs; and up to a $2,000 match for investors for allowing a total of up to $6,000 in short sale proceeds to be distributed to subordinate lien holders.

courtesy: National Association of Realtors Government Affairs Division.