The Home Affordable Foreclosure Alternatives has been one method that homeowners have been able to use and acquire short sales and deed in lieu of foreclosure programs, as this initiative has not only offered a way for homeowners to avoid a formal foreclosure process, but there are also some incentives that homeowners may receive if they are able to qualify for one of these programs that allow them to exit their home. Some homeowners have received relocation assistance as part of HAFA and, recent data from the February 2011 Making Home Affordable Program has tracked the number of HAFA agreements and transactions which were completed.
While there are other sources of data from the HAMP report that tracks the number of short sales or deed in lieu of foreclosure plans that particular servicers may have made, and do number quite higher than the results reported from HAFA, it was stated that the number of HAFA agreements that were started numbered at 10,177, while the number of transactions completed were 4,488.
Homeowners who have participated in this program have, again, been able to receive up to $3,000 for relocation assistance after a homeowner has exited their property through this particular initiative. Some homeowners have been unable to either find affordability through foreclosure prevention efforts, like modifications, and thanks to factors like unemployment and underwater home loans creating a situation where some homeowners owe a substantial amount more on their mortgage than their home is actually worth, this opportunity to escape a troubling home loan situation has been greatly beneficial.
Those homeowners who typically have been able to take advantage of either a short sale or deed in lieu of foreclosure plan are those who, as a result of these unemployment and underwater home loan factors, have simply been unable to make their mortgage payment, despite the fact that there are some homeowners in a negative equity situation who may be able to still meet their mortgage payment obligation. Sadly, negative equity has been a major problem for many and has led to situations where homeowners have simply walked away, but options to short sell a property may be more available when homeowners can prove they have seen financial distress in their lives.
Many of the major financial institutions in our nation who service mortgages and, obviously, participate in the Making Home Affordable Programs have been able to offer homeowners either short sale or deed in lieu of foreclosure assistance either through private methods or the Home Affordable Foreclosure Alternative plan, which again, has helped homeowners avoid substantial damage that may have resulted from a formal foreclosure.
Homeowners do need to be aware that there are some drawbacks to participating in a HAFA program, and surrendering the deed to a home, as an example, could lead to some financial setbacks, but homeowners who are participating in this particular program as a result of unforeseen financial hardships rather than bad financial practices are usually seen in a more favorable light by lenders in the future. However, homeowners will want to consult either a housing counselor or their servicer before participating in one of these plans so as to make sure HAFA will be the right step for their particular home loan situation.