New Streamline and Standardized Practices for Short Sales – HAFA

Oh Happy Day!

I completed a 2 1/2 hour update on the new rules in the new HAFA program (Home Affordable Foreclosure Alternative)that is launching April of 2010.  There are many new features that will most certainly take the wait out of the purchase of a short sale for a buyer.  My short sales that failed in 2009 which were a handful were mostly because buyers did get tired of waiting months for approval process.  The second largest reason they failed were the subordinate liens that were attached to the properties simply would not settle. 

 The new HAFA rules that most banks will be participating will make the wait go away once the property is listed after the borrower is approved for a short sale in the HAFA program.  There are timelines for each step which will make the process almost normal and the banks have to report and be accountable in this process to the government.  Again, the subordinate liens will be an issue but there is a new rule that also will make that an easier way to pay them off and have a deadline to approve or decline.

Bottom line Real Estate Agents that approach a property with an SSA in writing will be able to decide if they want the listing or not in a matter of seconds.  We spend on average over 200 hours working one file so this is a bonus.  The commission is capped at 6% with HAFA however if the bank hires a vendor to do what ever extra process they feel they need that fee % will come out of our 6%. 

The foreclosed properties/REO market is dry and has been dry because banks are not foreclosing on properties.  They are trying to keep borrowers in their houses and the Loan Modification’s are failing. Yes, the bottom has hit with pricing in many areas of the country and yet, 80% of the properties in this country are underwater therefore short sales and DIL’s are going to be around for the next 5 plus years.  2010 through 2012 loans are going to adjust which will trigger more distressed situations.   The average cost for a bank for a foreclosure now is over $50,000 in revenue.

I am currently finishing up my Certified Short Sale Professional training which is quite extensive to add to my CSS training.  Since the rules change weekly I feel that education about a short sale is never-ending. 

Website for all directives of the HAFA program www.hmpadmin.com