Real Estate Information Archive

The Home Affordable Foreclosure Alternative (HAFA), which helps eligible homeowners by pre-approving the short sale prior to listing their property, takes effect today, April 5, 2010.  The new guidelines set limits on a lenders response time, the lender forfeits the ability to pursue any deficiency judgment and it caps claims of subordinate lenders. 

In order to be eligible the loan must meet the following criteria: the property must be the borrower’s principle residence, the loan is a first mortgage, the loan originated before January 1, 2009, the mortgage is delinquent or default is reasonably foreseeable, the current unpaid balance is equal to or less than $729,750 and the borrower’s total monthly mortgage payment exceeds 31% of their gross income. 

Servicers/ lenders must consider Home Affordable Mortgage Program (HAMP) eligible borrowers for HAFA within 30 days once the borrower does on of the following: does not qualify for a trial period plan, does not successfully complete a trial period plan, is delinquent on HAMP modification by missing at least two consecutive payments, or the borrower requests a short sale or deed-in-lieu. 

The servicer must proactively notify the borrower in writing of the availability of a short sale and deed-in-lieu.  The borrower then has 14 days to contact the servicer with interest in these options, after which the servicer has no further obligation to extend the HAFA offer.  After this, the servicer will issue a short sale agreement (SSA) and request approval of a short sale (RASS) documents to the borrower in one of two ways: by request of the borrower (or their listing agent) or proactively by servicer/ lender.  If the borrower is not already working with a listing agent, they must find one at this point in order to proceed forward.  Within 14 days of the SSA’s effective date the borrower must sign and return the SSA with their listing agreement and information on any existing subordinate liens.  Within three business days of receiving an offer to purchase, the RASS must be submitted to the servicer/ lender.  Within 10 days of the RASS receipt, the lender must accept or deny the short sale request (RASS).  If it is accepted the listing agent will initialize the approval process and the sale of the house will proceed to a closing.  If it is denied, the servicer/ lender must send notification detailing the reasons for denial to the borrower and the borrower should consult with their listing agent for other foreclosure avoidance options.

These new guidelines will help homeowners and Realtors alike better navigate the short sale process.  Wayne Turner is continually expanding his education in the field of short sales and foreclosures.  In fact, he is among only three Realtors in the New Orleans metropolitan area to obtain the prestigious Certified Distressed Property Expert (CDPE certification).  If you know someone who is facing a foreclosure, please urge them to contact our team today. 

To view the step-by-step HAFA process, click here.

Wayne Turner Earns Prestigious Designation to Help Homeowners in Danger of Foreclosure

Mandeville, LA. 03-29-10  - Wayne Turner, Broker and Certified Residential Specialist of Keller Williams Realty Services in Mandeville has earned the prestigious Certified Distressed Property Expert^® (CDPE) designation, having completed extensive training in foreclosure avoidance, with a particular emphasis on short sales.  At a time when millions of homeowners are struggling with the possibility of foreclosure, the skills and education accumulated by Turner over his 14 years as a Realtor continue to be a huge benefit to St. Tammany area residents and communities.

Short sales allow the distressed homeowner to repay the mortgage at the price that the home sells for, even if it is lower than what is owed on the property. This process can save many people from foreclosure and even bankruptcy. If a bank forecloses on a property they place the home on the market for sale.  After the home sells, the banks have the right to redeem the difference between what was owed on the home and the actual sales price. More and more lenders are willing to consider short sales because they are much less costly than foreclosures.

Today, more than 13 percent of homeowners are delinquent on their mortgage or in the foreclosure process. This is occurring across all price ranges, and the fastest-growing category of homes in foreclosure is the luxury home market.

“The CDPE Education has been invaluable as I work with homeowners and lenders on complicated short sales,” said Turner. “It is so rewarding to be able to help families save their homes from foreclosure.”

Alex Charfen, co-founder and CEO of the Distressed Property Institute in Austin, Texas, said that agents such as Wayne Turner with the CDPE Designation have valuable perspective on the market, and training in short sales.  Turner offers homeowners real alternatives to foreclosure, which can be devastating to credit ratings, future employment and security clearances.

“Turner better understands market conditions than the average agent, and can help home owners through the complications of foreclosure avoidance,” he said.

The Distressed Property Institute trains real estate professionals on how to help homeowners in distress, with a particular emphasis on handling short sales.

“Our goal is to help as many homeowners as possible, by educating as many real estate professionals as possible,” Charfen said. “Wayne Turner has demonstrated a commitment to home owner’s challenges in this market, and will provide much-needed assistance in stabilizing the community.”