Posted on Jun 30, 2012 in Roseville and Sacramento Short Sale FAQs

Hello everyone, this is Mark Peek at Keller Williams Real Estate, your Roseville and Sacramento short sale specialists. Today I wanted to talk about some important changes that happened for HAFA guidelines. So if you are interested in doing a HAFA short sale, there have been some changes as of June 1, 2012, that in my opinion are definitely going to help with the success rate of HAFA short sales. First of all, before we couldn’t do a HAFA short sale if it was on a rental property. Well you don’t have to be owner occupied any longer. However if you purchased a replacement property, it can’t be within the last year. So if you purchased a replacement property or a move up property over a year ago, and you were making an effort to rent this property out because you thought it was the right thing to do. Maybe you went to your accountant and they told you that you need to do a short sale so you aren’t throwing any more money away. Since it’s been over a year since the purchase of your replacement home you can now complete a short sale through HAFA.

The difference is the borrower incentive or $3,000 will go to whoever is occupying the property. So, if you are renting the property, then the tenant would get the relocation incentive or $3,000. The other important change is that it actually increased the amount given to a junior lien holder not to exceed $8,500 where before it was limited to only $6,000. Often times that is not enough to make a junior lien holder settle in a short sale. Some junior lien holders won’t settle for less than 10 or 20 cents on the dollar. If you have a very large second or junior lien increasing to $8,500 is going to increase the success rate a bit more I would say for sure.

Also, the last thing is there have been some pretty significant changes to how this is being reported to the credit bureaus after a sale. Now you can do a HAFA short sale while being current on your payments. If you are in an imminent default situation, you can complete a short sale or a HAFA short sale now. How it’s being reported on your credit is a significant change because if you didn’t miss any payments they will now report you if you complete a HAFA short sale as being paid or closed in full. IF you miss payments and completed the HAFA short sale, it will show that it was paid in full but it will show that a foreclosure has been started or it was started. These are definite upgrades on how the settlement is being reported to the three credit bureaus which will help what your credit looks like after a short sale and your ability to be able to purchase again in the future.

Again, I’m Mark Peek with Keller Williams, your Roseville and Sacramento short sale specialist and I am here to help. If you have any specific questions or if you are considering a HAFA short sale and curious about these new guidelines, feel free to give me a call or send me an email. You can also click the start here button at the top of our website and enter your information and I’ll be happy to follow up with you. Thanks and have a great day.

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