U.S Treasury Updated HAFA Guidelines

The U.S. Treasury Department has updated its Home Affordable Foreclosure Alternatives (HAFA) program guidelines. The changes take effect June 1, 2011. New policies include a new acknowledgment requirement. The servicer must send written confirmation to the borrower within 10 business days following the receipt of a request for either a short sale or deed-in-lieu to acknowledge the request.
This timeline is now no more than 45 calendar days (not business days) from the date of the borrower’s request. Within that 45 days, servicers have to give the borrower a written approval, denial or alternative offer as well as a copy of the executed sales contract and any supporting documents dealing with subordinate liens. If the mortgage loan servicer fails to do this, it must at least send the borrower a written status notice within that same time period, along with written updates every 15 calendar days until the final decision is made.
In addition, servicers will now be able to approve short sales to non-profit organizations with the stated purpose that the property will be resold or rented to the borrower. This was previously prohibited by the program’s “arm’s length” requirement.
So Realtor's, what do you think of these changes? Will it help make HAFA more effective? Or are these new guidelines just words on paper until they get fully implemented?
Stay tuned we will keep you updated!

To Your Success!