Anyone who has faced or gone through a foreclosure knows how devastating the process can be. That includes millions of Americans who have struggled to make their house payments in our country’s unstable economic situation.
While many have walked away from their housing debt, others have sought to refinance or have their mortgages modified. Another option for relief has been something called a short sale. The transaction, which involves selling a property significantly below the amount owed on it, hinges on the lien holder’s (bank’s) willingness to accept the new asking price. Most of the time in the past, banks would not agree to it, as they stood to lose a great deal of money.
Due to the rising rate of foreclosures, banks have become more willing to approve short sales, according to Inland Empire-based real estate agent Kris Darney. And Darney said the federal government is helping out even further with its recently implemented Home Affordable Foreclosure Alternatives program (HAFA) .
HAFA provides financial incentives to servicers and borrowers who utilize a short sale or deed in lieu of foreclosure to avoid a foreclosure on a loan that meets certain eligibility requirements. Among them are: the mortgage must be tied to primary residence, imminent threat of default or foreclosure, deceased borrower or co-borrower, deployed for active military, employment relocation of more than 100 miles or serious injury or disability.
“This is also great for anyone who has an upside-down mortgage as long as they meet at least one of the requirements,” said Darney. “And the banks are giving the sellers a $3,000 check at the close of escrow that they can use however they want to.”
HAFA went into effect on April 1, 2010 and is an extension of the Home Affordable Modification Program (HAMP). Darney said most banks are participating, and on August 1, Freddie Mac and Fannie Mae came on board.
According to Patricia J. McClung, vice president of offerings management at Freddie Mac, both HAFA and HAMP reduce the need for potentially lengthy and expensive foreclosure proceedings. Additionally, they provide a much better outcome for everyone involved, as they help to preserve the condition and value of a property.
Darney and his wife Kim, who also is a real estate agent, are quickly becoming among the Inland Empire’s most trusted sources for short sale assistance. Along with being founders of business organizations such as Strategic Defaults, Inland Empire Short Sales and Sub Prime Recovery Group, the Darneys also have been the recipients of several real estate industry awards.
Additionally, the couple has written an e-book, “Should I Short Sale My Home?” It is available at no cost on their website: www.shortsalesellit.com. They also offer a variety of other real estate services, as well as assistance with the HAFA and HAMP programs.
“The HAFA program has been long-awaited by many people and we are dedicated to spreading the word throughout the Inland Empire and beyond,” said Kris. “Nothing means more to us than helping people in need and giving them the best service possible.”
