Foreclosure: Know Your Options

Understanding Home Affordable Foreclosure Alternatives may very well help you or someone you know avoid the negative effects of foreclosure and in some cases help keep a family in a home. The federal guidelines HAFA was introduced in 2009 and provides options offering incentives to homeowners, servicers and investors in order to accomplish a short sale, loan modification or deed-in-lieu of foreclosure. This last option is rarely the case however and more commonly a short sale is best allowing homeowners to transition to more affordable housing. This video from the administrations Making Home Affordable website can help.



In a short sale the homeowner and mortgage servicer agree to allow the property to be listed and sold for an amount less than what's owed. HAFA is designed to streamline the process and make it easier for a homeowner to work with the loan servicer. A homeowner accomplishing a successful short sale may receive up to $3000 toward relocation expenses. Additionally, mortgage servicers and investors are offered incentives although it should be noted that there is no requirement for them to participate in the program and that ultimately they adhere to their own guidelines.

Deed-in-lieu of foreclosure is another option that homeowners may have. If a homeowner makes a "good faith effort" to sell the property but is not successful a deed-in-lieu may be considered. The homeowner voluntarily surrenders the property and transfers ownership to the lender. Requirements are that the title is clear and there aren't any other mortgages or liens against the property.

In order to participate in the HAFA program servicers are required to evaluate for a loan modification before considering other options. If it's determined that a modification is appropriate the homeowner is entered into a trial modification program.

For more information on Knowing Your Options or for a free brochure call me 561-306-6736 or email ges.rellc@ymail.com

George Sinacori
GES Real Estate LLC