I am proud to say I am now a "Certified HAFA Specialist". Many of my clients might wonder what that means exactly - trust me, it's a good thing!
The HAFA Program is a very large and comprehensive Directive that cannot be discussed or explained in its entirety in this format, but I would like to at least give you some of the background information and point out some of the highlights of the program to give you an idea of who is eligible to participate so you can see if you could benefit from this program.
If you have been following the Real Estate Market and the measures the Government has taken to counteract and prevent Foreclosures and a further deterioration of the Housing Market, you will most likely have already heard of a program called HAMP - "Home Affordable Modification Program", announced by the Government in February of 2009. Under this program, distressed homeowners can apply for a Loan Modification or Refi if they are eligible and meet the requirements set forth under this program.
On November 30, 2009, the Treasury published Supplemental Directive 09-09, commonly known as HAFA - "Home Affordable Foreclosure Alternatives", with an actual implementation date of April 5, 2010. This Directive is comprised of 43 pages of guidelines and forms outlining foreclosure alternatives (such as Short Sale and Deed-in-Lieu) and eligibility. This supplemental directive only applies to loans not owned or guaranteed by Fannie Mae or Freddie Mac (which launched their own HAFA program in June, update coming soon), and spells out a standardized process with pertaining timelines and documents - something that is currently unheard of in "regular" Short Sales.
In order to be eligible for the HAFA program, borrowers must meet the following criteria:
1. The property in question must be the borrower's principle residence (program will not help with an investment property).
2. The mortgage loan in question is a first lien mortgage (not a second mortgage) and must have been originated on or before January 1, 2009.
3. The mortgage is already delinquent (meaning you are behind on your payments) OR default is "reasonably foreseeable".
4. The current UPB (Unpaid Principal Balance) is equal to or less than $729,750 (for single unit).
5. The borrower's total monthly mortgage payment is greater than 31% of his/her gross income.
In addition to a streamlined process, the program also offers monetary incentives, such as $3,000 for relocation assistance for the borrower, $1,500 for the services and up to $2,000 in reimbursements to first lien holders (for allowing a total of 6% UPB up to $6,000 max in short sale proceeds going towards the subordinate lien holders).
As HAFA is not a law, participation of servicers is not mandatory. However, if the servicer signed a contract to participate in HAMP, they automatically have to participate in HAFA. If you are unsure if your servicer (lender) is a participant in the program, please contact them directly to verify (just call the 1-800 number on your mortgage statement and speak directly to a bank representative).
My role as a Certified HAFA Specialist (as well as being Short Sale & Foreclosure Resource Certified) is to help you determine if you are eligible to participate in the program and to help you navigate through this entire process in order to avoid Foreclosure. And just in case you had not heard about HAMP and are wondering if you could get a loan modification, I can help you with that as well - my goal is to help you STAY IN YOUR HOME. Only if that is not an option, then Short Sale or Deed-in-Lieu might be the right choice for you to avoid Foreclosure to at least save your credit score from a major, negative impact.
If you are a distressed homeowner and would like more information about resources that can help you stay in your home and avoid Foreclosure, please visit our Distressed Homeowner Service Center for a comprehensive list of Government and Non-Profit resources. If you are considering participating in any of these programs or are considering a Short Sale or even foreclosing (or declaring bankruptcy) on your property, please seek the advice of an attorney and/or tax professional who will be able to explain the respective legal and monetary effects to you.
Sincerely,
Stephanie Frymyer
Stephanie Frymyer
Realtor, SFR, ABR, SRES
Certified HAFA Specialist
Member Worldwide Employee Relocation Council (ERC)
DRE 01390458
Your Realtor for Whittier (West Covina, La Habra, La Habra Heights, La Mirada, Fullerton, Brea, Diamond Bar, the Greater Long Beach area, and surrounding cities)
www.YourLocalPropertyPro.com
www.SereneFoundations.com
Main Street Realtors
DRE 01157065
Note: Supplemental Directive 09-09 is a very large body of work that cannot be discussed in its entirety in this forum. Above publication is not intended to be legal or tax advice. HAFA and Supplemental Directive 09-09 may have differing application by lender, servicer, or investor guidelines, so implentation and outcome can vary.
