January 8th 2015 – Great news for many homeowners still in distress in 2015!
The government short sale program, HAFA, just announced that for all HAFA short sales closing after February 1, 2015, sellers will receive $10,000 at the closing for relocation assistance funds providing they occupy the property at time the short sale is approved. If seller does not occupy the property, but there is a tenant, the tenant will receive the $10,000 to vacate the property at closing.
Supplemental Directive 14-04 October 30, 2014 Making Home Affordable Program –Program Updates
In February 2009, the Obama Administration introduced the Making Home Affordable (MHA) Program to stabilize the housing market and help struggling homeowners obtain relief and avoid foreclosure. In March 2009, the U.S. Department of the Treasury (Treasury) issued uniform guidance for loan modifications by participants in MHA across the mortgage industry and subsequently updated and expanded that guidance. On March 3, 2014, Treasury issued version 4.4 of the Making Home Affordable Program Handbook for Servicers of Non-GSE Mortgages (Handbook), a consolidated resource for guidance related to the MHA Program for mortgage loans that are not owned or guaranteed by Fannie Mae or Freddie Mac (Non-GSE Mortgages).
This Supplemental Directive provides program updates and administrative clarifications to the Home Affordable Modification Program® (HAMP) and the Home Affordable Foreclosure Alternatives® (HAFA) Program. Servicers that are subject to the terms of a servicer participation agreement and related documents (SPA) must follow the guidance set forth in this Supplemental Directive. This Supplemental Directive amends and supersedes the notated portions of the Handbook and, as stated herein, is effective January 1, 2015 and February 1, 2015.
This guidance does not apply to mortgage loans that are owned or guaranteed by Fannie Mae or Freddie Mac (each, a GSE), insured or guaranteed by the Department of Veterans Affairs, the Department of Agriculture’s Rural Housing Service or the Federal Housing Administration.
This Supplemental Directive covers the following topics:
- HAMP Tier 2 Interest Rate Adjustment
- HAFA Relocation Assistance
- HAFA Investor Reimbursement of Subordinate Lien Releases
- HAFA Reporting
HAFA Relocation Assistance
Section 6.2.5 of Chapter IV of the Handbook provides that a borrower, tenant or other non- borrower occupant who occupies the property as a principal residence and is required to vacate as a condition of the HAFA short sale or deed-in-lieu of foreclosure (DIL) may be eligible to receive relocation assistance of $3,000 at closing.
This Supplemental Directive increases the amount of relocation assistance to $10,000 for a HAFA short sale or DIL that closes on or after February 1, 2015.