In previous articles we’ve discussed the Making Home Affordable Program (12/10/10) and the Home Affordable Modification Program (12/31/10), but with over 50% of the nation’s homeowners now underwater and in danger of losing their homes, it is important to discuss what can be done to avoid foreclosure, or transition smoothly through this difficult time.
The December Housing Scorecard released by the U.S. Department of Housing and Urban Dvelopment, showed that foreclosure starts and completions dropped significantly in November as lenders reviewed internal procedures related to foreclosure processing. But all the good-news statistics in the world don’t amount to very much if you’re the one faced with a foreclosure notice.
For many families around the country, and even some closer to home, the reality of holding on to their home is still a uncertainty. The Obama Administration’s Making Home Affordable program (www.makinghomeaffordable.gov) , may yet offer an option to avoid foreclosure through the HAFA (Home Afforadable Foreclosure Alternatives) program.
How Does HAFA Work?
Through HAFA, homeowners who feel they can no longer afford their homes and are ineligible for other government assistance to modify their existing loans, may receive incentives for themselves, their mortgage servicers or investors, by conducting a short sale or a deed-in-lieu of foreclosure. This allows homeowners to transition to more affordable housing without the negative impacts of foreclosure, depending on each individuals circumstances.
In a HAFA short sale, the lender agrees to to the short sale terms prior to beginning the process. The homeowner sells the property for less than the full balance of the mortgage, and the lender accepts the short payoff as a full satisfaction of the lien.
In a Deed-in-Lieu of foreclosure, the lender allows the homeowner to voluntarily transfer ownership of the property back to the lender, where again the lender considers the lien satisfied in full.
How Can I Find Foreclosure Help?
There are many legitimate realtors offering advice, as well as short sale and foreclosure specialists. This is an emotional time and probably not one you will want to go through alone. It’s also a complicated process with many extra steps and different transactional items that are not necessarily part of a regular property sale.
“The Making Home Affordable website provides free counsellors to advise people about foreclosures and short sales,” said Vanessa Liddell, a short sale consultant and trainer who has trained agents all over the country. “Another good place to start is with your neighborhood realtor. They will often work with a specialist, such as myself, or will be able to find you someone who you can trust to give you the specialized service you need.”
As facing foreclosure or a short sale can be daunting, you need a realtor who will not only work with you to provide the real estate advice and services you need, but who can help find transitional housing, keep your kids in school, put you in touch with community services that can help, and just be a shoulder you can rely on.
Liddell also says, “If you’re working exclusively with a realtor, ensure that they have professional designations such as CHS (Certified HAFA Specialist), CREOLAS (Certified REO Listing Specialist) or CSSPIFS (Cerified Short Sale & Properties In Foreclosure Specialist).”
Heart realtors recently retained Vannessa Liddell’s services to ensure we have the best team available to help navigate foreclosure or short sale situations. If you need help, or want more information, please contact Heart Realtors at [email protected] or Vanessa Liddell at [email protected]