Changes to the HAFA Program through Bank of America

Bank of America released an article today on the current changes they have put in place with the HAFA Program ( Home Affordable Foreclosure Alternative Program)that went into effect on October 15th, 2011. I would like to encourage everyone to go to the Bank of America website for more information regarding these changes. I would first like to share who qualifies for this program as I still have many questions in this regard from REALTORS and homeowners on the guidelines.





Who qualifies for the HAFA program?


a) If the loan was originated on or before January 1, 2009





b) If the loan is past due or if the homeowner believes they will be missing a payment in the near future.





c) If the property has been vacant or rented out for less than 12 months, and the homeowner has not purchased another property in that time frame.





d) If the property is not vacant or condemned.



e) If the unpaid balance on the loan is no greater than the following:



1 unit: $729,750



2 units: $934,200



3 units: $1,129,250



4 units: $1,403,400


f) If the loan is not a Fannie Mae or Freddie Mac backed loan



g) If the homeowner has a true hardship and qualifies for a short sale



Incentives for homeowners through the HAFA program
After completing the program a homeowner may receive $3000 to assist with moving, rental and other relocation expenses.


Please note: Once the homeowner receives a letter from their lender to enroll in the program they have 30 days to respond. They will need to call the number on the form and let the lender know they would like to proceed with a short sale and pre qualify for the HAFA program.




Current Changes to the HAFA Program with Bank of America effective 10/15/2011




a) Borrowers may use their incentives to pay for transaction costs such as overdue utility bills or minor repairs, etc.

b) Bank of America will contribute up to $6000 toward the payoff of second lien holders.




I think these new changes will be very helpful. I just had a second lien issue today that was remedied due to the $6000 that BofA is contributing. I also feel if there are extra costs in the transaction a homeowner can help with using their incentives;that would solve problems at the end when trying to figure out where the money is going to come from,which happens alot in short sales.



Bank of America will want to see the home marketed for at least 120 days. If there is a sale date on the property, the sale date will be put on hold while the home is in the pre screening and marketing stage. There are two documents that will be required:



1. RMA- ( Request for Modification Affidavit)


2. Dodd Frank Cert- (Wall Street Reform and Consumer Protection Act)




Many of you that work with Lotus Realty Group have seen these documents requested by us. Once they are sent they need to be signed and returned as soon as possible to keep the file flow in continuous movement forward.





I have had many calls from clients and REALTORS who are not sure of the forms and the time lines; or if they qualify. It is important to make sure we are pre qualifying and setting proper expectations with our clients and the only way we can do that in an effective and efficient manner is to educate ourselves on these programs. This will also ensure we are giving our clients correct information and not setting ourselves up for an over promise and under deliver situation.




This information will be helpful on listing appointments with distressed homeowners. If you have any further questions in regards to this program or general short sale information, please feel free to give us a call. Either my staff, or I will be able to assist you.



Extra Tip

When pre qualifying your clients I would find out if they are aware whether or not they have MI. ( Mortgage Insurance) Any loan that has MI will need to get approval from the MI company before the short sale can proceed.



(Quote) A classical work doesn't ever have to be understood entirely. But those who are educated and who are still educating themselves must desire to learn more and more from it.

"Karl Wilhelm Friedrich Schlegel"




REALTORS, what is in your business plan this year? What are you doing to create a system that will allow you to build your short sale business? How often are you out there prospecting and how do you know if you are taking the listings that are going to be successful and not a waste of your time?



Call us today and let us show you a system that works to help you expand your business and effectively and efficiently close short sale transactions.



LOTUS REALTY GROUP



PROFESSIONAL SHORT SALE NEGOTIATORS




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