HAFA: New Short Sale Options
A new federal government program, called Home Affordable Foreclosure Alternatives, encourages lenders to pursue alternatives to foreclosure.
No homeowner wants to face foreclosure. It can be devastating both personally and financially. If you are faced with foreclosure now, or worried about it for the future, you’re not alone—15 percent of homeowners were either in foreclosure or delinquency during the last three months of 2009. Many homeowners are choosing to simply walk away from their homes and mortgages, but this can damage your credit score for years, making it difficult to get a loan in the future or even secure a job. A new federal government program can help, however. It won’t save your home, but will help you avoid some of the traumas of foreclosure .
Home Affordable Foreclosure Alternatives Program (HAFA)
Part of the Homeowner Affordability and Stability Plan (HASP) , the Home Affordable Foreclosure Alternatives (HAFA) program will launch April 5, 2010. The program provides financial incentives to mortgage lenders to pursue other alternatives to foreclosure, such as a short sale or deed-in-lieu , allowing the homeowner to avoid the substantial costs of foreclosure. There is also a provision for the homeowner to receive up to $1,500 for relocation expenses.
These alternatives reduce the need for potentially lengthy and expensive foreclosure proceedings and generally provide a substantially better outcome than a foreclosure sale for borrowers, lenders and the neighborhood alike.
Read More About: The New Short Sale and Deed-in-Lieu Options provided by HAFA
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