On Tuesday, June 1, Fannie Mae issued Servicing Guide Announcement SVC-2010-07 , introducing Fannie Mae's Home Affordable Foreclosure Alternatives (HAFA) Program. It, like Treasury's Home Affordable Foreclosure Alternatives Program (as described in Supplemental Directive 09-09 Revised ), is designed to mitigate the impact of foreclosures on borrowers who are eligible for a loan modification under the Home Affordable Modification Program (HAMP) but ultimately are unsuccessful in obtaining one.
Program Features
The Fannie Mae Home Affordable Foreclosure Alternatives Program, which becomes effective August 1, 2010, simplifies and streamlines the use of short or "preforeclosure" sale and deed-in-lieu of foreclosure (DIL) options on HAMP-eligible loans by incorporating the following unique features:
* Complements HAMP by providing alternatives for borrowers who are HAMP eligible (including borrowers facing imminent default);
* Allows the borrower to receive pre-approved short sale terms prior to the property listing;
* Prohibits the servicer from requiring, as a condition of approving the short sale, a reduction in the real estate commission agreed upon in the listing agreement;
* Releases the successful HAFA borrower from future liability for the debt;
* Uses standard processes, documents, and timeframes;
* Provides financial incentives to borrowers, servicers and subordinate lienholders; and
* Utilizes verified borrower financial and hardship information collected in conjunction with HAMP, eliminating the need for additional eligibility analysis.
For More Information
For complete program information, read the Announcement . Other related materials are available on the new HAFA page on eFannieMae.com.
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