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        <title>Minna Reid's Blog</title>
        <link>http://www.homesbyminna.com/blog/hafa/</link>
        <description>The Blog of Minna Reid, CT Realtor, short sale specialist. All about real estate and short sales in Connecticut from Minna Reid - CT's #1 Short Sale Realtor.</description>
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            <guid>http://www.homesbyminna.com/blog/another-ct-nationstar-hafa-short-sale-approval.html</guid>
            <link>http://www.homesbyminna.com/blog/another-ct-nationstar-hafa-short-sale-approval.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>Another CT Nationstar HAFA short sale approval!</title>
            <description> <![CDATA[ 
So it seems at least a few lenders are successfully incorporating HAFA into their short sale processing. Despite massive delays in HAFA processing with most lenders, at least Nationstar seems to have this HAFA thing down.


Back in May of 2011, this Plainville, CT property was first listed. Two months later we secured a buyer for the property. The file headed off to Nationstar. Unfortunately the first time around the file lagged at Nationstar so long that Hurricane Irene came to Connecticut and sent most of my clients street underwater.


The property flooded, became uninhabitable and the buyer walked. In September we went back on market. Soon after we secured a cash buyer...however yet again Nationstar took their sweet time and by January our second buyer also got tired of waiting and walked.


It only took a week to re-sell the property. Third time's the charm!


Nationstar finally kicked into gear...and a month later were ready to approve the short sale. It was at this point that Nationstar offered HAFA to my client. She agreed and two days later the sale was approved through HAFA and a few weeks later this Nationstar CT short sale closed!
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            <pubDate>Mon, 02 Apr 2012 16:06:07 -0500</pubDate>
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            <guid>http://www.homesbyminna.com/blog/a-double-nationstar-short-sale-success-through-hafa.html</guid>
            <link>http://www.homesbyminna.com/blog/a-double-nationstar-short-sale-success-through-hafa.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>A double Nationstar short sale success through HAFA</title>
            <description> <![CDATA[ 
While none of my other HAFA experiences have ever been good ones, this Nationstar short sale was the exception to the rule and hopefully a sign of things to come.


My clients came to me when their two mortgages with Nationstar had become debilitating and their commute to work had become unmanageable.


After 6 weeks on market a buyer was secured and a full short sale package headed to Nationstar.


 A few weeks later I heard from our negotiator.


While my client was not “delinquent enough” to be approved for an in-house short sale, they could be approved via HAFA.  Despite 9-15 month timeframes on my previous HAFA approvals, seeing no other option I advised my client to go ahead and attempt the HAFA short sale.


To my surprise – Less than a week later our short sale approval letter arrived. A fairly smooth closing on this Coventry, CT home followed 6 weeks later.


OWED: 1st and 2nd mortgages with Nationstar totaling:  $270,000


SETTLED IN FULL VIA HAFA: $175,000


TOTAL TIME FRAME LIST TO CLOSE: 3.5 months
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            <pubDate>Tue, 31 Jan 2012 08:45:15 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/14-months-to-a-seterus-hafa-short-sale-approval.html</guid>
            <link>http://www.homesbyminna.com/blog/14-months-to-a-seterus-hafa-short-sale-approval.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>14 months to a Seterus HAFA short sale approval</title>
            <description> <![CDATA[ 
HAFA - Governments "streamline" short sale solution? I dont know about you, but to me 14 months and streamline sounds like an oxymoron.


I've never been a fan of HAFA, and this Seterus short sale certainly didn't sway my opinion. I originally listed this Middletown, CT property and immediately my clients applied for the HAFA program. 6 months later, my clients were approved for HAFA...at about 30% over market value. We were unable to find a buyer to pay 130% of market value....but we were able to find one to pay market value. We moaned and groaned and convinced the lender they were off base with their value...and they did reconsider several months later. Unfortunately by then the buyer was long gone and we had had the pleasure of starting all over.


A few months later we were able to secure a second buyer. Once again the lender insisted on more than market value for the home. We persisted in pushing for yet a third valuation of the property, which of course came in higher than market value. Fortunately this time, we were able to reach a happy medium with the buyer and lender...and a workable short sale approval surfaced.


A few more months passed as the buyer pulled their loan together, and 14 months after starting their journey, my clients closed their HAFA short sale and collected their $3,000.


OWED: $205,000


SETTLED IN FULL WITH $3,000 SELLER RELOCATION ASSISTANCE: $143,000


TIMEFRAME: 14 EXCRUCIATINGLY PAINFUL MONTHS


 
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            <pubDate>Tue, 03 Jan 2012 08:02:03 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/hafa-to-the-rescue-a-15-month-hafa-story-with-no-end-in-sight.html</guid>
            <link>http://www.homesbyminna.com/blog/hafa-to-the-rescue-a-15-month-hafa-story-with-no-end-in-sight.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>HAFA TO THE RESCUE? A 15 month HAFA story with no end in sight.</title>
            <description> <![CDATA[ 
July, 2010 I took a new Connecticut short sale listing. This was a Fannie Mae Bank of America loan. Fannie Mae had just gotten on board with HAFA and my new clients wanted to go with the program.


HAFA was supposed to be governments solution to “streamlining ” and “simplifying” the short sale process.


A summary of the last 15 months:


July 2010 –  I met with my new clients and their property went on market


October 2010  - After about 6 weeks  Bank of America finally acknowledged our requests and a  HAFA short sale file was opened.


December 2010 – A HAFA approval letter arrived with a GROSSLY EXAGGERATED valuation of the property that could NEVER be reached. We started the value dispute process.


April 2010 – After 5 months of efforts to get a revision on the HAFA approval and getting nowhere, the clients finally decided to give up on the short sale and pursue their  deed in lieu option. I took the property off market.


November 2011 – Despite the fact that I no longer have this property listed, the file is in my Equator queue. As of today November 9 , 2011 – 15 months later - the file is STILL BEING REVIEWED FOR THE DEED IN LIEU.


Maybe in 2012 my former clients can look forward to seeing the end of their HAFA Processing?


HOWS THAT FOR A STREAMLINE SOLUTION???
 ]]> </description>
            <pubDate>Tue, 29 Nov 2011 14:17:27 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/a-perfect-example-of-why-hafa-is-a-miserable-failure.html</guid>
            <link>http://www.homesbyminna.com/blog/a-perfect-example-of-why-hafa-is-a-miserable-failure.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>A perfect example of why HAFA is a miserable failure</title>
            <description> <![CDATA[ 
A perfect example of why HAFA is a miserable failure


I wasn't always against HAFA. When HAFA was announced last April, I attempted to remain optimistic about the program, despite feeble results from anything else produced by government to ease our housing problems.


Over a year later, I can officially say I hate HAFA. If my clients opt into this program I always do my best to get them through it, but the truth is the success rate of HAFA is unbelievably slow and low. Less than 1 in 10 of those I have seen through the program has actually had a desirable ending with HAFA, and unbelievable amounts of time get wasted in the process.


Just the other day I received another HAFA "approval" that presents many of the usual problems. At least this time it only took us 3 months to get through to the end of the program before we discovered that it was all just a waste of time (as I first suspected).


The "APPROVAL" has a few issues:


The approved list price on the approval was $225,000.


BUT...We have been on market for over 60 days starting at $190k and are now down to $160k with no takers. Furthermore - $225k is actually MORE THAN THE PAYOFF on this loan. If we could get 225k, we wouldnt need to short sell at all!


My client is entitled to $3,000 when he successfully closes within HAFA guidelines.


BUT...My client is a few months behind. He's no longer paying. In order to get the $3,000, he must now begin making reduced payments of almost $2,000/month (which the fine folks at HAFA deemed affordable for him) from now until closing. Four months later (if we close) he can collect his $3,000. What a fantastic deal, right???!!!!


All documentation needed to be returned signed, along with his first $2,000 payment by April 21, 2011, or the deal was off.


BUT...The letter arrived April 25. Ooopppss!! No great loss for us though. After reading through his "approval" my client wisely decided to opt out of HAFA and move forward with a traditional short sale instead.


That's our tax dollars at work folks!
 ]]> </description>
            <pubDate>Tue, 29 Nov 2011 08:26:40 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/should-i-choose-a-hafa-short-sale.html</guid>
            <link>http://www.homesbyminna.com/blog/should-i-choose-a-hafa-short-sale.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>Should I choose a HAFA short sale?</title>
            <description> <![CDATA[ 
Should I choose a HAFA short sale?


Many Connecticut homeowners that have decided to short sell will inevitably be offered the option of choosing to go with the lenders traditional short sale program or HAFA (Home Affordable Foreclosure Alternatives)- government's short sale program.


While HAFA was originally touted as a "streamlined" solution to help underwater American homeowners and offers some benefits such as full debt forgiveness and $3,000 cash incentive, the reality of HAFA has proved to be quite different.


The decision to opt in or out of HAFA should not be taken lightly and here I have outlined the realities of both scenarios to help you make a decision.


The pros and cons of your lenders traditional short sale program vs. HAFA


Lenders in-house traditional short sale program PROS:




Improved timelines. Most big lenders have been processing short sales consistently for several years now  and their processes have much improved. From my experience the current approval time for a short sale with one of your big lenders - Bank of America, Wells Fargo, GMAC, Citi, Chase will be anywhere from 3-7 weeks ON AVERAGE. Over time most lenders have picked up the pace and are decent to work with.


Flexibility in short sale negotiations. There are a lot of variables in any short sale, and a lot of different terms that may need to be negotiated or re-negotiated such as payoffs to junior lienholders, timelines to close, etc. While most lenders are not fun to negotiate with, most of the time they will have some flexibility and a lot of items are able to be renegotiated to satisfaction.


Incentives to homeowners. Some, though definately not all, lenders will approve a closing cost credit to the seller at close. This is unpredictable and heavily dependent on the investor on the loan.


If the first short sale fails, you can try again. Not all short sales work out the first time. In a traditional short sale it is pretty easy (if sometimes time consuming) to just try again if the short sale does not work out the first time for some reason.




Lenders in-house traditional short sale program CONS:




Unpredictable terms of approval. When getting started there will be no guarantees that the lender will completely forgive the remaining debt when approving a short payoff. It has though been my experience that MOST of the time lenders will completely settle for the short payoff, and lately some of the even more stubborn lenders are moving towards debt forgiveness. It has also been my experience that even when a lender WILL NOT completely forgive the remaining debt, the odds of them pursuing that debt later are low. I have YET to see any of my former short sellers pursued for a deficiency judgement, even when the lender did reserve the option to do so.


You may not get a cash incentive. Thats right - you may not get any cash back from your short sale.




HAFA short sale PROS:




Full debt forgiveness is guaranteed. If you do manage to make it to the end of the program and graduate with a closed sale, your lender will never be able to pursue you for the remaining debt.


$3,000 incentive. Assuming that by the time your short sale gets closed, other fees left uncovered by HAFA approval ( back taxes, attorney fees, credits, etc) does not eat up your $3,000 incentive, you may in fact walk away with the $3,000.




HAFA short sale CONS:




The odds of making it through the program are very slim in reality. The program was designed to help America's 11 million underwater homeowners. As of January 2011 ( 10 months into the program ), just 661 people have been helped by the program.


HAFA can take a very, very long time. It will take years before HAFA is integrated into the system and the bugs are worked out. From my experience with local Connecticut home sellers, getting approval for the program takes an average of 6-9 months minimum. (New guidelines promise to shorten this, but the new guidelines do not apply to Fannie Mae and Freddie Mac -  who own most loans)


HAFA appraisals are often unrealistic. In order to determine what terms will be approved, HAFA will need an appraisal of your home. The problem I have noticed is that especially with HAFA these appraisals come in too high. Also, because of the long timelines involved, by the time the approval is issued the appraisal is too old to be relevant. This leaves an approval letter that can never be met.


HAFA terms of approval are often unreachable and have zero flexibility. HAFA is very strict on their terms and allowable payouts to other lienholders. If there are any other liens against the property - including second mortgages, sewer liens, judgement liens etc, the odds of getting  a HAFA approval letter to satisfy everyone are slim to none.


You may never see that $3,000 after all. Since it takes forever to get a HAFA approval and because their terms are so ridiculously tight, odds are you'll end up paying some or all of the $3,000 back in to the sale to satisfy all the fees involved.


By agreeing to HAFA, you agree to voluntarily foreclose if the HAFA short sale approval letter can't be met. So in addition to the long timeline, difficult to satisfy approval, you've also now signed up for a deed in lieu of foreclosure if it doesnt work out.




Think hard before choosing HAFA!
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            <pubDate>Mon, 28 Nov 2011 14:22:04 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/a-long-overdue-hafa-short-sale-success-with-bank-of-america.html</guid>
            <link>http://www.homesbyminna.com/blog/a-long-overdue-hafa-short-sale-success-with-bank-of-america.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>A long overdue HAFA short sale success with Bank of America</title>
            <description> <![CDATA[ 
It took 9 months and a ton of aggravation but I finally witnessed a HAFA short sale actually close. This Connecticut short sale seller contacted me in March 2010 to get his home sold. Between a Bank of America first mortgage and a Bank of America HELOC, the home was seriously upside down. 


Not two weeks later we had a buyer in contract and the sale was moving along smoothly in Equator. We anticipated a closing soon after. NOT SO FAST!!!! In early April the troubles began when my client became eligible for HAFA.


Although at that time the program was brand new and we did not know what to anticipate, the promise of $3000 and full debt forgiveness was too much for my seller to pass on and he decided to pursue the HAFA short sale approval.


A 9 month exercise in frustration followed. Not many buyers are prepared to wait 9 months for short sale approval and this was no exception. The buyers walked and were replaced as we waited for HAFA to run its course. Paperwork was faxed and lost. Appraisals came and went. Bank of America's HAFA department made one blunder after another as we patiently waited. On more than one occasion my seller was ready to give up and simply walk away from the home... but he managed to hang in there and in December 2010 all the stars aligned and this HAFA short sale CLOSED.
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            <pubDate>Mon, 28 Nov 2011 13:49:56 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/hafa-the-painfully-slow-road-to-a-deed-in-lieu-of-foreclosure.html</guid>
            <link>http://www.homesbyminna.com/blog/hafa-the-painfully-slow-road-to-a-deed-in-lieu-of-foreclosure.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>HAFA: the painfully slow road to a deed in lieu of foreclosure.</title>
            <description> <![CDATA[ 
HAFA: the painfully slow road to a deed in lieu of foreclosure.


It has been 17 months since the launch of HAFA - government's "streamlined" short sale program - meant to simplify the short sale process and save families from foreclosure.


Unfortunately this program is proving to have the opposite effect. I have personally had a few of my sellers go through this program and at this point I am recommending all sellers steer clear of this program due to its many flaws and simple lack of desired effect.


A few examples:


One of my sellers has spent 6 months waiting to be approved into the program. 6 months later he has been approved, but to date we cannot get anyone at HAFA to actually tell us the terms of approval. Meanwhile, my seller has missed 7 mortgage payments ruining his credit, we have lost a very good buyer and the property has been beat up hard by the downward market. Since our appraisal was so long ago and we do not know any of the approved terms, my guess is that the new lesser buyer's offer ( the best we could get in today's market ) will not satisfy the HAFA terms ( no matter what they may be) and my seller will be left with two choices:


A: Backtrack to a traditional Bank of America short sale and start over


B: Take the deed in lieu


Another of my sellers has also been waiting 6 months for approval. Meanwhile 2 buyers have come and gone. The approval letter has arrived, and the terms are so strict there is no way we could EVER get a buyer in place to meet the terms. Therefore, all was for naught. With 2 liens, he cannot even qualify for a deed in lieu and will likely foreclose.


In a third case - a seller came to me with a HAFA approval in hand. Unfortunately, again the terms of the approval are impossible to meet with any buyer, hence a surefire deed in lieu.


My official stance on HAFA: It is tremendous waste of time and energy for all involved, a guaranteed way to ruin credit and at the end of the day will result in a deed in lieu almost every time, if not just a foreclosure as most people will not make it through the eternal wait and will just give up.


Almost all traditional short sale programs with every lender will be a quicker, more successful road to a workout - Think hard before choosing HAFA.


Who will HAFA help then? The REO agents. This program will assure the banks end up with lots more inventory to mess up their books and flood the market. But I guess someone always benefits at the end of the day. Just in this case, it's not the intended party.
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            <pubDate>Mon, 28 Nov 2011 13:17:22 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/caught-in-hafa-hella-bank-of-america-hafa-mess.html</guid>
            <link>http://www.homesbyminna.com/blog/caught-in-hafa-hella-bank-of-america-hafa-mess.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>Caught in HAFA Hell...A Bank of America HAFA MESS!</title>
            <description> <![CDATA[ 
Caught in HAFA Hell...A Bank of America HAFA MESS!


On March 30, one of of my short sale listings went under deposit. By the end of April, this Bank of America short sale had gotten all the way to the very end of the short sale process (on Equator) and all was well. We were expecting an approval and we were getting ready to close....


NOT SO FAST!


On May 8 my client was moved into the new HAFA (Home Affordable Foreclosure Alternatives) program.


The HAFA program (from government - "for the people") was designed to "streamline" the short sale process.


Just like any government program, HAFA has proved a miserable failure at streamlining anything. For almost 4 months we have chased this short sale through Bank of America's HAFA department.


There are several problems:




HAFA reps insist on ONLY speaking to the homeowner. They are not agent friendly, therefore the client has to do much of their own short sale processing, and agents can rarely get straight answers for their client without asking the client to call in.


The HAFA line never gets answered, and eventually drops you into a voicemail box, threatening agents to "stay away", but it doesn't really matter who calls, since no one gets a return call anyway. So once you've sent your homeowners to call, have them schedule several long breaks into their schedule for a few days for this activity, and one day they may even reach someone.


Once you do get a hold of someone - they never knows what's going. Bank of America negotiators HATE HAFA. The HAFA negotiators don't have a clue. In fact if you ever get the pleasure of speaking with these fine folks they will happily share how they dont have enough resources to get the job done, they are overburdened and no-one has really had any training, that there are no real timelines, and hey that's just how it is so hurry up and wait. HAFA negotiators are also incapable of faxing or emailing ANY documentation. The only way they will communicate with the client is via SNAIL MAIL - remember that speedy efficient way of communicating? Thats the only way HAFA does it.




After 4 months of this, my client has finally been successfully approved into the HAFA program. Which leads to our latest problem: We have no idea what the terms of approval are. HAFA has not communicated the terms of approval to us. They cannot fax the approval documents or email them. GET THIS - They cannot even see the approval letter to read it to us over the phone. When we asked for help from Bank of America (non-HAFA) loss mit personnel - we were met with giggles, but no help. We didn't find it so funny ourselves, but at least someone is having a good time over this...


So what to do??? Well we will continue to wait for THE MAILMAN, so that we may all figure out exactly what the last 4 months of frustration actually got us.


 


So much for the "streamlining"....


Thanks Big Brother for HAFA! Thanks so much for all the "HELP". 
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            <pubDate>Mon, 28 Nov 2011 11:35:07 -0600</pubDate>
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            <guid>http://www.homesbyminna.com/blog/bank-of-americas-hafa-program-the-big-black-hole.html</guid>
            <link>http://www.homesbyminna.com/blog/bank-of-americas-hafa-program-the-big-black-hole.html</link>
            <author>minnareid@gmail.com (Minna Reid)</author>
            <title>Bank of America's HAFA program: THE BIG BLACK HOLE</title>
            <description> <![CDATA[ 
And just when I was starting to have hope for Bank of America. Since implementing Equator things have really been moving along. What were formerly 6-10 month short sale approvals were down to one or two months. There was some confusion during the transition but overall, the end result was a change for the better. Things were moving right along.


Along came HAFA. Government's new streamlined 10 day short sale program- right??? RIGHT!!!!! 


All of a sudden one day 3 of my clients that were close to approval in Equator were halted and I received this message:


"Per our system, the seller has received paperwork about the HAFA government program. Please note that paperwork has been sent to the seller directly and contains the HAFA government vendor contact information. Please note all questions and communication is to be directed to the HAFA government vendor assigned in the seller's paperwork. If this isn't something they are interested in, please have them call the vendor directly to have the campaign code removed or contact 877-452-3908 for details. Once the campaign code is removed from our system I can resume negotiations as usual."


Sounds simple enough right?


The problem is this...NO ONE EVER PICKS UP THE LINE!! One of my clients actually got through once and they said he qualified for the program...and then...NOTHING! No mail, no call, no contact. Weeks have passed. On many tries this line rings endlessly and drops into a voicemail box where messages go unreturned. To make matters worse agents are not allowed to call on behalf of their clients. It is a homeowner only line. There is only a single number to call. Regular Bank of America negotiators also cannot answer questions about HAFA, except to tell you to "call the number". So basically there is no one to call, no way to find out anything about the program, and no way to decline the program until you get through on the line. NOTHING BUT A BIG ENDLESS BLACK HOLE.


THANK YOU BANK OF AMERICA FOR YOUR FINE VENDOR SELECTION.....


BUT MOST OF ALL THANK YOU BIG BROTHER FOR ANOTHER FINE PIECE OF GOVERNMENT INTERVENTION! 


I KNOW YOU MEAN WELL, BUT ISN'T IT TIME TO ADMIT YOU DONT HAVE A CLUE AND JUST DECIDE TO STAY OUT OF BANKING...REAL ESTATE...THE PEOPLE'S PRIVATE AFFAIRS? 


PLEASE???
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            <pubDate>Mon, 28 Nov 2011 10:04:43 -0600</pubDate>
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