KW Atlanta Peachtree Road Office Real Estate Legal Tip:

New HAFA program for Short Sales

HAMP:  Home Affordable Modification Program (for refinances)
      -    for borrowers trying to modify their current loan and stay in their home
 
HAFA:  Home Affordable Foreclosure Alternatives program (for short sales)
-         for borrowers who may qualify for HAMP but still need to sell their home
-         goes into effect on April 5, 2010 (some lenders may implement sooner)
 
Guidelines for each program vary based on the type of loan and investor (Fannie Mae, Freddie Mac, or other).
 
Basic eligibility requirements:
 
1.Principal residence
2.First lien (mortgage) originated before 2009
3.Mortgage delinquent or default is reasonably foreseeable
4.Unpaid principal balance no more than $729,750 5.Borrower’s current total monthly payment exceeds 31% of gross income

Important factors considered by lender:

1.Severity of the loss
2.Local market conditions
3.The timing of pending foreclosure actions
4.Borrower motivation and cooperation

Benefits:

1.Provides process for short sale pre-approval prior to listing or contract
2.Lender can not foreclose during HAFA process
3.May allow seller to receive some proceeds for moving (up to $1,500)
4.Allows small allocation to subordinate loan payoffs (up to $3,000)
5.Borrowers are fully released from future liability on the first mortgage (no note or deficiency judgment)
6.Protects realtor commissions up to 6% as shown in listing agreement

CONSULT YOUR LENDER TO SEE IF YOUR SELLER QUALIFIES

 Presented by Leigh Clack, Attorney
Neel & Robinson, Attorneys at Law LLC
lenox@neelandrobinson.com
404-705-3690         fax 404-705-3697
22 Lenox Pointe, Atlanta, GA 30324

 
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