**Important HAFA updates March 2012**
HAFA, or Homes Affordable Foreclosure Alternatives Program, is a government initiative to help Americans that cannot afford their mortgages avoid foreclosure. The objective of the program is to give aide to people that can no longer afford to make their mortgage payments in order to help them transition to more affordable housing while avoiding going into foreclosure.
HAFA offers incentives and aide for people utilizing two different options of avoiding foreclosure, a short sale or a deed in lieu of foreclosure. A short sale is when the lender agrees to allow the homeowner to sell the home for less than the amount that they owe on the mortgage in order to avoid foreclosure. After the sale of the home, the remaining debt to the lender on the mortgage is negotiated into a repayment plan, or in some cases completely wiped away. In a deed in lieu of foreclosure, the homeowner will trade ownership, or the deed, of the property to the lender in exchange for not going into foreclosure and forgiveness of all of the remaining debt on the mortgage. The lender will then take complete ownership of the property and the homeowner will be free of any remaining mortgage obligations.
Through HAFA homeowners can receive benefits that will help them perform a short sale or a deed in lieu of foreclosure and transition to their next home. Some of these benefits include:
- Receive free advice from real estate agents and HUD-approved housing counselors.
- HAFA will guarantee that any remaining debt following the short sale of a home will be forgiven.
- HAFA short sales get the mortgage company to agree upon an acceptable short sale price, instead of whatever offer is accepted.
- With HAFA a short sale or a deed in lieu the affect on your credit score is less than a traditional foreclosure, short sale, or deed in lieu.
- Upon closing of the short sale or deed in lieu, HAFA will provide $3000 in relocation aide money.
HAFA does have certain eligibility requirements that must be met in order to qualify for a HAFA short sale or HAFA deed in lieu.
- Currently live in the home or have lived there in the last year
- Experienced a documented financial hardship
- In the past year have no purchased a new home
- First mortgage is no greater than $729,750.
- Obtained mortgage on or prior to January 1, 2009
- No convictions for felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction within the last ten years.
For more information on the Homes Affordable Foreclosure Alternatives Program, you can visit their website or contact a foreclosure defense attorney at the Law Offices of Justin McMurray P.A. to schedule a free consultation.