Short Sales have been taking so long & many homeowners worried about how their credit would be affected. They have been on the fence. What is the right thing to do…Miss payments or Stay Current?
The federal Treasury Department’s short sale program, HAFA, has been updated again and these new changes mean more homeowners will be eligible for help. Part of Making Home Affordable, the federal short sale program offers many benefits for borrowers who can no longer afford to keep their home. The government is determined to help lenders, servicers and borrowers move through this process more quickly and clear out the delinquent loans asap.
HAFA guidelines have been pretty strict as far as income allowed to qualify and whether the homeowner is current or behind on payments. The program has been revamped to allow more borrowers to qualify who wish to short sale and obtain incentives from HAFA.
The 5 biggest changes that I see benefiting borrowers are outline below:
Better Credit Rating: It will show “paid or closed account/zero balance” or “account paid in full/a foreclosure was started”.
Homeowner does not have to go behind on payments to qualify, they can stay current
The property no longer has to be “owner occupied”. Investment properties can also qualify
New Income Guidelines: Mortgage payments can exceed 31% of the gross monthly income of the borrower. Eligibility reviews should be within 30 days instead of 3+ months
Junior liens (2nds, 3rds, etc) can receive up to $8,500 as opposed to the previous limit of $6,000.
This program is extended thru 2013.
HAFA provides homeowners with a protection against future liability for the mortgage debt, and eliminates the lender asking for a promissory note or cash contribution from the seller. Seller’s also receive $3000 paid at closing to help with relocation expenses.
Short selling your home is a difficult decision, but getting a fresh start is a wise choice-especially when HAFA provides these important protections and benefits.
For more information & help to see if you qualify for this new program, contact Cheryl Lichen-Hooper at 661-505-8102 or visit my website www.SCVResourceCenter.com