It’s been just over two months since the Treasury’s adjustments to the Home Affordable Foreclosure Alternatives program took place. In that time, we’ve seen some big improvements in the process and have been able to qualify more of our clients than ever before.
For those of you unfamiliar with HAFA, as its name suggests, it is a government sponsored program that aids homeowners in pursuing alternatives to foreclosure. In most cases, those alternatives are short sales or deed-in-lieu of foreclosure. For some of the finer details, we wrote up a full explanatory piece on it.
In regards to the recent changes, most of them have been done to help further ease the process for owners, as well as open up the program to more people. A full list of all of the changes can be found at the program’s web site, but we since we receive a lot of questions on the subject, we thought we’d highlight some of the biggest.
Credit Rating: One of the largest concerns clients have about short sales is the effect it will have on their credit rating. From June 1, 2012 on, credit bureau reports will now show Account Status Codes of either 13 (Paid or Closed Account) or 65 (Paid in Full/Foreclosure was started).
Relocation Assistance: A big draw to HAFA was its relocation assistance program, which offered up to $3,000 in aid. This is still in effect, but extra guidelines have been added that state that these funds are limited to those living on the property at the time of the sale. For most families, this change is negligible.
Junior Liens: As before, holders of Junior Liens may be eligible for additional financial assistance. This amount has increased from $6,000 to $8,500.
Occupancy: Originally, HAFA was limited to homeowners who lived on the property within the most recent 12-month period. Those requirements have been lifted, however the owner must not have purchased any other properties within the last 12-months.
The HAFA program continues to be a huge help to homeowners looking to move on to the next chapter of their lives. While it continues to grow and expand in its reach, navigating the application process can still be tricky and time consuming. As such, if you have any questions or concerns, don’t hesitate to contact us for assistance. As your Central Florida short sale experts, we’re always happy to share our knowledge and experience to aid you in coming to the best decision for your specific situation.