Fannie Mae and Freddie Mac to participate in HAFA.
For those of you who have been following HAFA, one thing that bothered most people was the fact that the large GSEs Fannie Mae and Freddie Mac were not participating in the HAFA program. Well, as of June 1, that is no longer the case. Both Fannie and Freddie have announced they will implement their own version of HAFA starting August 1, 2010. Like the private sector’s HAFA program, the program will end on December 31, 2012.
However, some of the major differences offered by the new Fannie Mae and Freddie Mac HAFA programs include, but are not limited to:
- Both institutions will pay the servicer a $2,200 incentive fee for successful short sales
- Both institutions will pay the servicer a $1,500 incentive fee for all successful DILs
- The Deed for Lease (D4L) is available for borrowers who request and are approved to remain in the property following a successful DIL
The specific details on these programs are listed in their websites. eFannieMae.com andFreddie Mac Bulletin.
What does this latest move mean? It simply means that with the two large Government Sponsored Enterprises (GSE) now on board with HAFA, the short sale process and its effect on how the process will be handled in the future is now complete. The days of lenders dragging their feet and making up their own rules on how short sales will be processed and approved is over now (theoretically, at least). Everyone will have the same process by which to abide.
Cash for Short Sale! The HAFA Program
It has been a little over a month since the long awaited HAFA program was rolled out. Most larger institutions and loan servicing companies have signed on to voluntarily participate in the program. It is truly a win-win for both the lenders and the borrowers.
One of the biggest benefits of a HAFA approved short sale is the cash contribution component to the homeowners for their moving expenses. This was commonly called Cash for Keys in the REO world, and now it is available to the short sale world as well.
