HAMP and HAFA Offer Real Help to Distressed Homeowners

Don't believe all the negativity in the anecdotal world. The HAMP program, Home Affordable Modification Program from the government has modified 600,000 mortgages and the servicers, or the company collecting on home loans on other programs, has created a look a like program following the HAMP guidelines and have modified over 1.5 million loans.

That is 2.1 million homeowners that have had real help in staying in their homes. The 1.5 million look a likes required no tax payer dollars as well, but would not have happened but for the structure created by HAMP.


HAMP lenders receive an incentive only AFTER a successful short sale closes, or a loan modification is successful. There are many incorrect myths about this process currently.


As recently as Feb 1, 2011 the rules have changed for the better. Until recently, selling your home short of the needed money to pay off the loan could take over 6 months, and often ended in foreclosure if all parties were not communicating effectively or at all. Some of the changes are:



1. A borrower's reason for relocation no longer needs to be connected to employment nor be of a certain distance from the property. Borrowers may have moved up to 12 months prior to certain dates in the HAFA process but may not have purchased another home.


2. Servicers are not required to determine if the borrower's total monthly mortgage payment exceeds 31% of gross income. Borrowers will still be required to show a hardship.


3. Servicers are now required to communicate approval, disapproval, or a counter offer no later than 30 calendar days after receiving an (i) executed sales contract, (ii)Alternative Request for Approval of Short Sale and (iii) a signed Hardship Affidavit.


4. If an unsolicited borrower requests HAFA, the servicer has 30 calendar days to determine the borrower's eligibility and , if eligible, send the borrower the Short Sale Agreement.


5. HAFA will no longer impose a 6% cap on payments to each subordinate mortgage/lien holder. The $6,000 aggregate limit is still in effect.

If you check out this website, www.hopenow.com/questions.php to take a self assessment quiz.


Please do NOT avoid your loan servicer. If you are too distraught, I am happy to call and start the process. The NEW HAFA rules make short sales much more desirable and way less cumbersome. HAFA, Home Affordable Foreclosure Alternatives program.


Pick up the phone, call me or call your lender if you are in trouble.