Many of the nation’s top mortgage servicers have been able to offer a variety of assistance to struggling homeowners in need of more affordable mortgage payments or even opportunities like forbearance but some homeowners have turned to a short sale or deed in lieu of for foreclosure plans from initiatives like the Home Affordable Foreclosure Alternatives as a way to alleviate their mortgage burden when their situation may not be helped by simple payment reductions or other foreclosure prevention plans. However, some homeowners have had a difficult time when it comes to finding ways to avoid foreclosure but recent reports from the Treasury Department indicating that these HAFA short sales and in deed in lieu of foreclosure opportunities are still being made available and increases in the number of agreements that have begun and completed are being seen as well.
As an example, in the month of June it was reported that the total number of HAFA agreements that had been started stood at 21,412 while the number of agreements completed stood at 10,754. In the month of July, it was reported that these numbers increased to 25,716 agreements started and 12,888 agreements completed. Obviously, continued increases in these programs may be beneficial for homeowners who are looking to use this particular route to handle their mortgage predicament, but homeowners are not always in a position to benefit from a short sale plan or deed in lieu of foreclosure.
Homeowners should keep in mind that problems related to a decrease in the credit score of individuals who use these programs have been an issue, but in many cases individuals are already seeing financial setbacks that could lead to financial troubles if they cannot get rid of their mortgage. Sadly, there have been some instances where homeowners were able to meet other obligations outside of their mortgage payment, but upon using a short sale option, as an example, still saw their credit score decrease. However, there are cases where lenders who may work with these homeowners in the future might see that their situation was simply a result of factors outside of a homeowner’s control as to why they participated in one of these foreclosure alternatives plans and not the inability of a homeowner can meet all of their debt obligations.
While factors like unemployment is one of the main reasons that homeowners pursue a short sale, issues like negative equity is also a problem and have resulted in some homeowners seeking out this particular route of debt relief when it comes to getting rid of their mortgage. Understandably, not all homeowners are able to take advantage of a short sale or deed in lieu of foreclosure plan from HAFA but if certain circumstances are in place and homeowner may have no other options available, there are some advisers who at least suggest that homeowners look into what this particular type of program will entail so that they may be better informed on this particular program that could help them if paying their mortgage payment or dealing with negative equity is a problem.