Short Sale Update—HAFA

A short sale is when a home sale proceeds are less than the balance owed to a lender. The lender ultimately decides to sale the house at a smaller loss versus the home going into foreclosure. Both parties have an interest in avoiding a foreclosure due to the exorbitant fees and what it does to the borrowers credit.


HAFA—Home Affordable Foreclosure Alternatives, is a government program to speed up the short sale process. The lender implementation date was April 5th.

Lenders were requesting a uniform short sale process, forms and guidelines.

The objective of HAFA is: 1) to help HAMP—eligible borrowers/sellers avoid foreclosure—hardship is usually required. 2) Process a short sale or a deed in lieu of a foreclosure.

Requirements for HAMP Elegibility:

1. Loan prior to 2009

2. Principal balance up to $729,750

3. Delinquent or foreseeable default

4. Must be principal residence (unless if owner moved for job)

5. Payment is greater than 31% of gross income

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/.