The Buyer's Blog

If you've ever been involved with short sales, you've probably been frustrated by the arduous process involved.  A short sale is a transaction in which the lender, or lenders, agree to accept less than the mortgage amount owed by the current homeowner.  In some cases, the difference is forgiven by the lender, and in others the homeowner must make arrangements with the lender to settle the remainder of the debt.  Each process is lender specific, meaning each holder of the loan usually has their own processes and procedures. 

The Home Affordable Foreclosure Alternative Program (HAFA) introduce by the federal government in November is an effort to streamline the process and allow investors and/or home buyers to buy some of these short sales with less effort.  The guidelines of the program require lender participates to use standard procedures, documents, and timelines.  The program is voluntary, however 78 mortgage servicers, representing 85% of eligible mortgage debt, are participating, including such major banks as Wells Fargo, Citimortgage, and Bank of America.

There are possible financial incentives for both the buyer and the seller.  Wether you're looking to purchase a home that is a short sale or are an investor, it's important to be represented by a real estate broker familiar with the process.  At Buyer's Choice, the Buyer's Best Friend, we keep up with new programs like this so that we can represent our clients to the highest degree.