As of June 1, 2012 there will be significant changes to the HAFA program. The updates will allow a homeowner to remain current on their mortgage, qualify for HAFA, and go through a short sale with less of an impact on their credit.
The major changes include:
- The deadline for submitting for HAFA eligibility will be extended a full year, from December 31, 2012 to December 31, 2013. UPDATE: HAFA has been extended through December 31, 2015.
- The removal of occupancy requirements: HAFA until now has required homeowners to have lived in the property within the last 12 months. This requirement is being removed.
- The $3,000 relocation incentive will be limited to properties occupied by an owner at the time of the short sale.
- Mortgage payments will be allowed to exceed 31% of the homeowner’s gross monthly income. The effect of this will be to allow a homeowner to remain current on her mortgage and still qualify, minimizing the overall potential impact to her credit, and certainly shortening the waiting period to purchase in the future.
- Junior lienholders may receive up to a maximum of $8,500, up from $6,000 previously (these are incentives to junior lienholders).
- There are also new mandates regarding what the lender can state on the borrower’s credit report that, reportedly, will lessen the impact on the borrower’s credit rating.
We will post additional information as it becomes available.
Washington Property Solutions Can Help Guide You Through The HAFA Process
Call us at 425-381-2233 or toll-free at 866-732-9725 for more information.