More Short Sale Info

More Short Sale Info

Last Friday we discussed HAFA—Home Affordable Foreclosure Alternatives which is a government program to speed up the short sale process.

Under HAFA borrowers are provided pre-approved short sale terms.

HAFA:

1. works for borrowers that are eligible for HAMP but don't seem to be able to sell their home
   
2. releases the borrowers from future liability on the first mortgage
3. has standard documents and processes
4. allows the borrowers to get pre-approved terms for their short sale before listing the property

When the lender allows the borrower to list the house at less than what is owed, it is considered a short sale. If the borrower cannot sale the house, sometimes they will transfer the title to the lender in what's called a DIL, Deed in Lieu. A Deed in Lieu is considered a friendly foreclosure and as for how it affects the borrowers credit, it's somewhere between a short sale and a foreclosure. The lender has to agree to a DIL.

With either the DIL, HAFA or Short Sale the lender cannot require a cash contribution and cannot pursue the borrower with a deficiency judgment.

If you would like more information on short sales or would like to talk to one of our agents about listing your home, visit our website at http://www.real-estate-denver-colorado.com/.