HAFA Short Sale

HAFA Information Center

The Home Affordable Foreclosure Alternatives (HAFA) program helps struggling homeowners successfully avoid foreclosure by short selling their home with a well developed set of guidelines that provides some cash at closing to the seller ($3,000.00), a formalized timeframe to sell the home and an approved sale price established up front by the mortgage lender. This program does not cover every homeowner and/or every property. See if you may qualify for HAFA assistance. Click Here. Click Here for the HAFA Short Sale guidelines and HAFA 2-1-2011 Update (Supplemental Directive 10-18).

Who Is Eligible For HAFA

Applying For HAFA Assistance

List Of Lenders Participating In HAFA

HAFA Documents

How will HAFA help homeowners?

1. Establishes a standard set of processes, guidelines and timeframes. Lenders will, for instance, be required to respond to offers within 10 days on a HAFA approved property.

2. Financial incentives payable to homeowners, servicers and investors.

3. Releases struggling homeowners from all future liability for forgiven debt (this applies to mortgage deficiency judgments and not tax liability).

4. Provides pre-approved short sale terms before the home is put on the market.

5. Streamlines homeowners HAFA eligibility by using information from HAMP analysis.

Home Affordable Foreclosure Alternatives Program (HAFA)

You can get cash back from the short sale of your home. The Home Affordable Foreclosure Alternatives guidelines have been added to the Making Home Affordable program. Short sale incentives for homeowner's that include cash back and formal timeframes to list and sell your home have been added.

It is crucial that you select a real estate agency that has familiarity with this program and a track record of success in obtaining successful resolutions for clients. Many real estate agents are either unaware of this program, unfamiliar with the methods to obtain it, or ignore it because it provides no direct incentive to them. IML Short Sale is committed to obtaining the best possible resolution for all of our clients and will secure this assistance for those who are eligible.

Click Here for the HAFA Short Sale guidelines.

Making Home Affordable Short Sale Program (HAFA)
IML Short Sale wants all clients and potential clients to be aware of their options. Recently, additional features were added to the Making Home Affordable program that pertain to short sales.

An important change to the Making Home Affordable plan is the inclusion of a Short Sale or Deed-In-Lieu foreclosure alternative.

For eligible borrowers unable to retain their homes through a Home Affordable Modification, MHA will provide incentives to borrowers, servicers and investors to encourage short sales and deeds-in-lieu. Both allow families and servicers to avoid the costly foreclosure process, and to minimize the negative impact of foreclosures on borrowers, financial institutions and communities.

Both a short sale and a DIL (Deed-In-Lieu) provide an opportunity for borrowers to avoid the consequences of foreclosure. In a short sale, a servicer allows the borrower to sell the property at it's current value, even if the sale price is less than the total amount owed on the mortgage. Approval of a short sale requires the borrower to list and actively market the at it's fair value. the sale must have all proceeds (after selling costs) applied to the discounted mortgage payoff. If the borrower actively markets the property but is unable to sell it within the agreed upon time period, a servicer may consider a DIL. With a DIL the borrower voluntarily transfers ownership of the property to the servicer - provided the title is free and clear.

How The Home Affordable Short Sale/DIL Program Works:

Borrower Eligibility: Borrowers will be eligible for the Foreclosure Alternative Program if they meet the minimum eligibility criteria for a Home Affordable Modification but did not qualify for a modification in the end or were unable to sustain payments during the trial period plan or after the final modification. Prior to going in to foreclosure, participating servicers must evaluate each eligible borrower to determine if a short sale is appropriate. Considerations in the determination include property condition and value, average marketing time in the community where the property is located, the condidition of the title including the presence of junior liens and a determination that the net sales proceeds are expected to exceed the investor's recovery through foreclosure.

Incentive Payments: Borrowers may receive incentive compensation of up to $3,000.00 to assist with relocation expenses.
Standardized Documentation: The program will publish streamlined and standardized documentation, including a Short Sale Agreement and an Offer Acceptance Letter. These documents will outline specific marketing terms, describe the rights and responsibilities of all parties and establish clear timeframes for performance. Creating one standard set of documents that the industry can use is expected to minimize the complexity of these transactions and significantly increase use of the short sale option.
Property Valuation: The servicer will independently establish both property value and the minimum acceptable net return in accordance with investor guidance and will provide instruction to the borrower's real estate agent regarding the initial list price and any premissable price reductions. The price may be determined based on either: (1) an appraisal performed in accordance with USPAP and/or (2) one or more Broker Price Opinions either of which must be dated within 120 days of the Short Sale Agreement.

Minimum and Maximum Duration: Under the program, servicers will allow borrowers at least 90 days to market and sell the property, with possibly more time based on local market conditions. The property must be listed with a licensed realtor experienced in selling properties in the neighborhood. Marketing of the property may run concurrently with the foreclosure process; however no foreclosure sale can take place during the marketing period specified in the Short Sale Agreement as long as the borrower is acting in good faith to sell the property. There will be a maximum marketing period of 1 year for the property,

Fees and Charges: Servicers may not charge borrowers fees for participation in the Foreclosure Alternative Program.

Property Eligibility: Any junior liens, mortgages or other debts against the property must be cleared for the property to be sold as a short sale or deeded to the servicer. The servicer can proceed with a short sale or deed-in-lieu if there is a reasonable belief that all liens on the property can be cleared.
Program Expiration: Eligible sellers will be accepted until December 31, 2012. Program payments will be made upon successful completion of a short sale or DIL.

Deed-in-Lieu: At the servicer's option, the Short Sale Agreement may include a condition that the borrower agrees to deed the property to the servicer in exchange for a release from the debt if the property does not sell within the time specified in the Agreement. In this case the borrower would have 30 days to vacate the property and would be entitled to $1,500.00 to assist with relocation expenses, in addition to any other funds the servicer may provide to the borrower.

We believe an educated public is vital in this market, and IML Real Estate will continue to provide updates on this program and others. Considering a short sale? Please contact IML Real Estate with any questions/concerns you may have 1-800-811-7615 or request a free consultation here.

Short Sale Submission Form

With some basic information we can provide you with an informative consultation that will help you determine if a short sale is the right solution for you.

* Name:

* Email:


* Property Address:

Home Value:

* Months Behind

Purchase Price:

Year Purchased:

1st Mtg. Lender:

Balance (1st):

Payment (1st):

2nd Mtg. Lender:

Payment (2nd):

Balance (2nd):


Doubleday Group

DRE# 01527298

NMLS # 1699776

Brian Doubleday

DRE# 01216167

NMLS # 253467