Davidson Realty, Inc.

Top 5 Things Homeowners Should Know about the New HAFA Regulations & Short Sales

May 7, 2010

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Posted by in Distressed Properties, News, Short Sales

With an estimated 12% of Jacksonville and St. Augustine area home mortgage loans currently delinquent, new regulations from the U.S. Treasury Department’s Home Affordable Foreclosure Alternatives program (HAFA) may provide some much-needed financial help. The new HAFA regulations, which went into affect on April 5, offer more incentives that make a short sale a smarter and better alternative to foreclosure for the majority of homeowners. Explains Davidson Realty President Sherry Davidson, “The new HAFA rules are a huge help for homeowners who otherwise might be faced with foreclosure.  A HAFA short sale can help homeowners protect their credit, gain a $3,000 relocation incentive and not worry about future liability so they can get on with their lives.”  The top five things homeowners should know about the new HAFA short sale, include:

1. Homeowners who qualify for a HAFA short sale are fully released from future liability for the first mortgage debt.  This means that the mortgage lender cannot come after the homeowner at any future time for repayment of the original loan.
2. A HAFA short sale allows for a $3,000 relocation assistance payment for homeowners. That’s a one-time payment of up to $3,000 to help sellers with moving costs, rent security costs, etc.
3. Most major lenders are already on board with the new HAFA rules, including Citibank, Wells Fargo, Bank of America, Wachovia, Chase, Wamu, and the list continues to grow.
4. With HAFA, the short sale process has been standardized and streamlined so homeowners can expect a quicker outcome.
5. Homeowners can enlist the Realtor of their choice to help them through the HAFA process so they have an advocate.  A Realtor can also help the homeowner determine if they qualify for a HAFA short sale and, if not, what other options are available to them.

More information about HAFA and a complete list of eligibility requirements is available on the  Treasury Department’s website: http://www.makinghomeaffordable.gov/hafa.html.  Some of the primary qualifiers for HAFA, include:
•  Must be the principal residence
• The home loan originated on or before January 1, 2009
• The homeowner is behind on their payments or soon will be
• The unpaid principal balance on the loan is no more than $729,750 for a single-family property
• The total monthly payment on the mortgage is more than 31% of the gross income of the borrower

Davidson Realty is committed to helping homeowners facing tough economic times. Twenty-eight (28) Davidson Realty agents hold the Certified Distressed Property Expert (CDPE) designation.  A Certified Distressed Property Expert® (CDPE) is a real estate professional with specific understanding of the complex issues confronting the real estate industry. CDPE real estate professionals have trained extensively to understand the options, solutions, and effective methods for dealing with homeowners facing hardships, including foreclosure.

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