Replies to This Discussion

Permalink Reply by Steven Pawera on July 26, 2011 at 2:16pm

INCOME and ASSETS are no logder requirements of HAFA.  The lenders do not get to 'decide' if they want to participate.   One question I do not know the answer to: if the 2nd is signed up for HAFA but not in the 2MP component, do the have to particpate?  For questions/clarifications and lenders who choose to ignore HAFA after you've read the supplement ditectives at hmpadmin.com (under Programs and Guidance), the greatest resource in the world is emailing support@hmpadmin.com.  they will  also escalate on your behalf with stubborn servicers.  Good luck!

 

Permalink Reply by Rob E. Kirchner on July 26, 2011 at 2:44pm

Thanks Steven,

I will check into this, however, we really never sought or asked to be placed into the HAFA program.  We were directed to request HAFA by the lender.  I am still thinking (and hoping) that this was just a formality by the lender and doesn't affect their actual decision about the short sale.  What are your thoughts?

Permalink Reply by Maggie Hood on July 26, 2011 at 3:08pm

I believe when the first lienholder accepts and approves HAFA, the second lienholder must agree to participate.  if the borrower qualifies under HAFA guidelines, the only potential problem is whether the actual offer is within the parameters of the BPO - but the thing is, lenders seem to change all the rules to suit their needs.

Permalink Reply by Rob E. Kirchner on July 26, 2011 at 3:19pm

Thanks Maggie, but, the 1st approved the short sale -they haven't mentioned anything in writting about HAFA.  The 1st has a approval letter and closing date all set up.

 

 

Permalink Reply by Steven Pawera on July 27, 2011 at 1:49am

Ok, I read your situation more carefully than this morning when I was doing a million things at once.  US Bank doesn't want to do the short sale because the borrower has a good income and can 'afford' the mortgage.

 

Has the borrower's situation CHANGED from when they got their mortgage?  If there is no hardship (i.e they earn less than before, or now have higher expenses than before), this would be a STRATEGIC default.  And servicers do those short sales too.

Let's skip the fact that the servicer's servicing income will come to a screeching halt upon a successful short sale, so that's why they really don't want to do short sales.  Let's skip that they don't understand what a fiduciary duty to their investor is (but they will learn as they are sued).

The path of least resistance would be a HAFA short sale.  With the Feb 1 changes, even with a $million in the bank, you still qualify for HAFA.  The income asset thresh-holds are gone.  I guess they needed to get more people into the bailout program.  :)

Permalink Reply by Joe Beauchamp on August 2, 2011 at 8:48pm

There is no upside to the 2nd doing HAFA - they get nothing for it and are not allowed to try to go after the remaining debt afterward.  I run into this frequently.  The HAFA program straight-jacket's the 2nd and gives them no reason to go along.

 

There is wording that suggests that the buyer (or anyone but the seller) can put more money into the second.  You might try to save the deal if that would work out.  The directive wording is that no money for the sale beyond their stated limits can go to the 2nd.  This implies that money NOT from the sale  but from the buyer or the agents, etc. CAN go to the 2nd.

 

Basically, you are in the typical HAFA situation where the 2nd is not at the same bank as the 1st.  Generally not do-able.

Permalink Reply by Steven Pawera on August 2, 2011 at 9:47pm

Well now that HAFA just became irrelavant in Cali (after SB458 eliminated deficiency judgments), I think BAC has overreacted:

 

We had MI approval, with the buyer contributing an addititonal amount to the 2nd.

As I was wondering 'where is my approval letter?', you'll never guess what happened:

managemnt review of the file determined SB458 means no one, (including the buyer) can contribute to a file - so instead, BAC will contribute out of the net proceeds to the 2nd.

I'm not really complaining, but if it isn't one thing I'm waiting on, now it's another.  Why exactly did we choose to specialize in short sales?  :)

Permalink Reply by Rob E. Kirchner on August 3, 2011 at 10:02am

"why did we choose to specialize in short sales?" -my sentiments exactly!  Our plan now is to back up and punt.  We extended the escrow until the 20th of this month and then we plan to re-write the offer, & resubmit it.