The Home Affordable Foreclosure Alternatives (HAFA) Program is a program designed for sellers that are upside down in their house. This program is for those folks that have contemplated selling their home as a “Short Sale” rather than allowing for foreclosure. So how does it work?
The benefit of this HAFA program is that you would no longer be responsible for the difference between what you owe on your mortgage and the amount that your home sells for. You see, in South Carolina, most banks would order a deficiency judgment against the borrower for the difference in what the home sells for, and what is owed. The HAFA program would be the contrary. Sellers would also receive $3,000 at closing as an incentive to selling as a short sale, as opposed to going into foreclosure.
To qualify, you must:
-Live in the home, or have lived in the home in the last 12 months (primary residences only)
-Have not purchased a new house within the last 12 months
-Have a documented financial hardship (Ok folks, this means no bank statements showing all of the fun you had dining out, going on vacations, etc.).
-The first mortgage must be less than $729K
-You obtained your mortgage on or before January 1, 2009.
This HAFA program is for mortgages that are owned by Fannie Mae or Freddie Mac. Remember- 80% or more of all loans are owned by either of those two. Most of you have banks that service your loan like Bank of America, Wells Fargo, etc. – so ask them.
If you have any questions about short sales and how they may affect your credit, please call us and ask. We are certified Short Sale and Foreclosure Resources (SFR’s) and can help you in determining what the right course of action might be in your circumstance.
Mike Ciucci specializes in the Charleston SC real estate market. He has been a Charleston realtor for over 15 years, focusing on quality and attention to detail his clients have come to expect.