Freddie Mac HAFA Short Sale Program Information

The Home Affordable Foreclosure Alternatives (HAFA) Short Sale Program is a government program which came about as part of the American Recovery and Reinvestment Act and the famed ‘stimulus’ package that was all over the news in March of 2009.

However, while the HAFA Program was mentioned in the stimulus package, more information did not become readily available some eleven months later. In April of this year, the HAFA Program began. The most well-known benefits of this program include a 00.00 incentive at closing to homeowners who participate in the program. Additionally, if borrowers qualify for the program, then the short sale will relieve the borrower of any future liability for the unpaid loan balance.

It is interesting to note that not all investors participate in this program. However, effective August 1, 2010, Fannie Mae and Freddie Mac do participate in the HAFA Program. While their version of the program does have some slightly different guidelines, the goals of their programs are generally the same.

One important change that Freddie Mac made to their HAFA Program is that borrowers cannot participate in this program if they are already in a HAMP Loan Modification Trial Period, if they are performing a HAMP modification, or if they are already being reviewed for a Freddie Mac short payoff.

With these other HAFA Programs, we have been able to get many short sale sellers qualified even after they have attempted a loan modification, during the trial period or after short sale submission. The fact that Freddie Mac is not allowing those individuals to participate will disappoint many borrowers.

Before you look over the fact sheet, you may be wondering how to determine if you have a Freddie Mac loan. Well, click on the hyperlink in the previous sentence and all of you questions will be answered!

Freddie Mac HAFA Bulletin Fact Sheet (June 2010)

Freddie Mac HAFA Short Sale Program Information

The Home Affordable Foreclosure Alternatives (HAFA) Short Sale Program is a government program which came about as part of the American Recovery and Reinvestment Act and the famed ‘stimulus’ package that was all over the news in March of 2009.

However, while the HAFA Program was mentioned in the stimulus package, more information did not become readily available some eleven months later. In April of this year, the HAFA Program began. The most well-known benefits of this program include a 00.00 incentive at closing to homeowners who participate in the program. Additionally, if borrowers qualify for the program, then the short sale will relieve the borrower of any future liability for the unpaid loan balance.

It is interesting to note that not all investors participate in this program. However, effective August 1, 2010, Fannie Mae and Freddie Mac do participate in the HAFA Program. While their version of the program does have some slightly different guidelines, the goals of their programs are generally the same.

One important change that Freddie Mac made to their HAFA Program is that borrowers cannot participate in this program if they are already in a HAMP Loan Modification Trial Period, if they are performing a HAMP modification, or if they are already being reviewed for a Freddie Mac short payoff.

With these other HAFA Programs, we have been able to get many short sale sellers qualified even after they have attempted a loan modification, during the trial period or after short sale submission. The fact that Freddie Mac is not allowing those individuals to participate will disappoint many borrowers.

Before you look over the fact sheet, you may be wondering how to determine if you have a Freddie Mac loan. Well, click on the hyperlink in the previous sentence and all of you questions will be answered!

Freddie Mac HAFA Bulletin Fact Sheet (June 2010)

Just a few days ago, I received a copy of a California Department of Real Estate memo on Short Sale Fraud. The Department of Real Estate (DRE) memo was written as a result of the growing number of questionable (and sometimes unlawful) practices with regard to ‘requiring’ or ‘compelling’ (I live that word) a short sale buyer to pay the Short Sale Negotiator’s fee.

When I got this memo, I giggled just a little bit. Several months ago, I had an experience similar to one described in this memo. An agent in my office represented a buyer on a short sale. Escrow was opened at the very beginning of the short sale process. We received the approval with the buyer’s name on it, and we thought we were good to go. But… then an addendum to the purchase contract was received in which a request was made for the buyers to pay a short sale negotiator fee. Aah. No good, no good, no good.

When I spoke with the office manager at the listing brokerage, I mentioned that there was already an approval and that buyer and seller were under contract. He responded by telling me that the listing agent had another buyer, just in case the buyers being represented in my office were not interested in moving forward.

That’s why I love the word ‘compelling.’ This listing agent was attempting to ‘compel’ the buyers from my office to agree to pay the short sale negotiation fee in order to avoid losing out on the property. After our conversation, we were able to close this transaction quite amicably and the buyers are thrilled with their new home. However, I wish this document had been around several months ago.

Thanks so much to my friends at the Department of Real Estate for writing this stern memo about short sale fraud that described my little dilemma to a tee.

Below, I have shared a copy of the nine page memo. It’s a pretty interesting memo for all of you short sale aficionados. You may want to make yourself a cup of hot cocoa with marshmallows, put on your Snuggie, sit down on your sofa right next to a roaring fire, and have a read! Or… just take my word for it. There is lots of short sale fraud out there. Some is intentional and some is not. Be careful and think before you act.

Short Sale Fraud Warning

One another note: After today, I will have four days left and I will have completed the 30-day blogging challenge. Once I’m done, I may need a wee little break.

Southern California Sports Yet Another RE Bar Camp in Anaheim, CA  October 4, 2010

Real estate professionals have yet another go at RE Bar Camp in Southern California. The next one is being held in Anaheim, the day before Tech Tuesday and the start of the California Association of REALTORS (C.A.R.) Annual Expo from October 5 – 7, 2010. 

 RE Bar Camp C.A.R. Expo should be another outstanding event, specially with so many gathering from around the state for the convention starting the next day. And for folks who are Disneyland fans, what a great opportunity for fun and learning. 

I’m particularly pleased that our Southern California Chapter of CRS is going to be one of the sponsors, the second RE Bar Camp we have sponsored. 

You can register for RE Bar Camp C.A.R. Expo NOW. Do it!!

Southern California Sports Yet Another RE Bar Camp in Anaheim, CA  October 4, 2010

Real estate professionals have yet another go at RE Bar Camp in Southern California. The next one is being held in Anaheim, the day before Tech Tuesday and the start of the California Association of REALTORS (C.A.R.) Annual Expo from October 5 – 7, 2010. 

 RE Bar Camp C.A.R. Expo should be another outstanding event, specially with so many gathering from around the state for the convention starting the next day. And for folks who are Disneyland fans, what a great opportunity for fun and learning. 

I’m particularly pleased that our Southern California Chapter of CRS is going to be one of the sponsors, the second RE Bar Camp we have sponsored. 

You can register for RE Bar Camp C.A.R. Expo NOW. Do it!!

How Can I Connect on ActiveRain?

CONNECTING – READING – SUBSCRIBING  – COMMENTING – ASSOCIATING 

If you are newer to blogging on AR, you may be wondering “How can I connect on AR?“

Well, let me count some of the ways. There are loads of opportunities

WRITING ENTERTAINING AND INFORMATIVE POSTS will encourage folks to engage and connect with you. Do so regularly. Localism posts work well for consumers but you maty not get many comments.

RESPOND TO COMMENTS YOU RECEIVE and don’t just say “thanks for the comment.” You may not be able to respond to each one, especially if you get a ton on one of your posts, but at least make an effort to interact with a bunch of commenters. 

READ OTHERS’ POSTS AND COMMENT REGULARLY AND INTELLIGENTLY. And don’t just say the proverbial “good post.”

Here’s a novel idea – STEP AWAY FROM THAT COMPUTER AND PICK UP THE PHONE and call AR folks that interest you, when you have a question, or you simply want to have a live conversation. I had a great chat with Debe Maxwell this morning – we have followed each other for ages but never talked live.

EMAIL OTHER BLOGGERS with questions, sharing information or a personal message you don’t want to put in the comments of their blog, or just to say hi and introduce yourself 

SUBSCRIBE TO BLOGS THAT INTEREST YOU. You can do this easily. You will see a Subscribe to this Blog button on the sidebar of the blogger’s post. Some bloggers also add RSS links in the footer of their posts or on the sidebar. Take advantage of this so you will hear as soon as a new post is live from your fave writers. 

Don’t forget to CHECK OUT PEOPLE’S PROFILES to learn more about them personally – their business, passions, experience and areas of service. Plus you might find some interesting connections – hobbies, where they went to school or grew up, etc. 

ADD PEOPLE AS ASSOCIATES. Click on the “More About Me” link on the sidebar of their post under their photo. On their profile page you will see a link to “Associate with Me” under their photo. Do so. On the next screen you’ll then have several options to add them to one or more groups such as:

Mortgage Lenders/Officers
Other Folks to Know
Staging
Training/Coaching
Virtual Assistant

CONNECT WITH FOLKS BY JOINING ANY OF THE 6826 Groups that interest you. You can join as many as you want but be careful to not overdo. It gets difficult to participate in them all and it doesn’t make sense if you can’t or don’t post to a group.

Take connecting to the next level and LOOK FOR LINKS TO FOLKS’ SOCIAL MEDIA PROFILES, especially Facebook, Twitter, and LinkedIn (perhaps in the sidebar of their blog or in the footer of their posts). Why not connect there, too, and see what they are doing and sharing outside of AR? 

CONNECT WITH AR FOLKS AT RE BAR CAMPS, RAINCAMP, OR LOCAL GATHERINGS in your general area or if you travel (I just met with several folks when I was traveling for CRS in Arizona). OK, so it’s NOT connecting on AR itself but the benefits are still tremendous. Heck you might meet someone you aren’t yet connected with on AR.

Are YOU taking advantage of the connectability that AR offers?

You might find Are You Engaging or Just Playing Around to be of interest. Or not.

How Can I Connect on ActiveRain?

CONNECTING – READING – SUBSCRIBING  – COMMENTING – ASSOCIATING 

If you are newer to blogging on AR, you may be wondering “How can I connect on AR?“

Well, let me count some of the ways. There are loads of opportunities

WRITING ENTERTAINING AND INFORMATIVE POSTS will encourage folks to engage and connect with you. Do so regularly. Localism posts work well for consumers but you maty not get many comments.

RESPOND TO COMMENTS YOU RECEIVE and don’t just say “thanks for the comment.” You may not be able to respond to each one, especially if you get a ton on one of your posts, but at least make an effort to interact with a bunch of commenters. 

READ OTHERS’ POSTS AND COMMENT REGULARLY AND INTELLIGENTLY. And don’t just say the proverbial “good post.”

Here’s a novel idea – STEP AWAY FROM THAT COMPUTER AND PICK UP THE PHONE and call AR folks that interest you, when you have a question, or you simply want to have a live conversation. I had a great chat with Debe Maxwell this morning – we have followed each other for ages but never talked live.

EMAIL OTHER BLOGGERS with questions, sharing information or a personal message you don’t want to put in the comments of their blog, or just to say hi and introduce yourself 

SUBSCRIBE TO BLOGS THAT INTEREST YOU. You can do this easily. You will see a Subscribe to this Blog button on the sidebar of the blogger’s post. Some bloggers also add RSS links in the footer of their posts or on the sidebar. Take advantage of this so you will hear as soon as a new post is live from your fave writers. 

Don’t forget to CHECK OUT PEOPLE’S PROFILES to learn more about them personally – their business, passions, experience and areas of service. Plus you might find some interesting connections – hobbies, where they went to school or grew up, etc. 

ADD PEOPLE AS ASSOCIATES. Click on the “More About Me” link on the sidebar of their post under their photo. On their profile page you will see a link to “Associate with Me” under their photo. Do so. On the next screen you’ll then have several options to add them to one or more groups such as:

Mortgage Lenders/Officers
Other Folks to Know
Staging
Training/Coaching
Virtual Assistant

CONNECT WITH FOLKS BY JOINING ANY OF THE 6826 Groups that interest you. You can join as many as you want but be careful to not overdo. It gets difficult to participate in them all and it doesn’t make sense if you can’t or don’t post to a group.

Take connecting to the next level and LOOK FOR LINKS TO FOLKS’ SOCIAL MEDIA PROFILES, especially Facebook, Twitter, and LinkedIn (perhaps in the sidebar of their blog or in the footer of their posts). Why not connect there, too, and see what they are doing and sharing outside of AR? 

CONNECT WITH AR FOLKS AT RE BAR CAMPS, RAINCAMP, OR LOCAL GATHERINGS in your general area or if you travel (I just met with several folks when I was traveling for CRS in Arizona). OK, so it’s NOT connecting on AR itself but the benefits are still tremendous. Heck you might meet someone you aren’t yet connected with on AR.

Are YOU taking advantage of the connectability that AR offers?

You might find Are You Engaging or Just Playing Around to be of interest. Or not.

Today’s slow real estate market is a hard place to sell Orlando homes. However, the fact remains that homes are still being bought and sold. Buyers are out there; you just have to attract them to your home.

Here are a few tips for getting Orlando homes sold in a slow real estate market:

Prepare for the Sale
Your home needs to stand out from the rest. Give it a lot of sparkle and shine:

• Make minor repairs: Patch holes, fix faucets and replace cracked tiles.
• Clean inside and out: No cobwebs, dirty carpets, worn rugs or smelly odors.
• Check your curb appeal: Mow the lawn, plant flowers, trim bushes, etc.
• Remove clutter and de-personalize: If it isn’t essential, pack it up or get rid of it.
• Straighten your cabinets and closets: Buyers will open them; make sure they’re nice and neat.

Stage Your Home
Hire a professional home stager or read informational home staging articles on doing it yourself. Here are a few quick tips:

• Carefully choose your window coverings.
• Tie new bathroom towels with ribbons for a “finished” bathroom look.
• Use color psychology.
• Bring in plants.

Use Good Marketing Techniques
A strong marketing campaign is a must. A few techniques you want to be sure you or your agent includes in your marketing campaign are:

• Take photographs with good lighting that show off the positive aspects of your home.
• Create a virtual tour that showcases both the inside and outside of your home.
• Display the photos and virtual tour on as many real estate websites as possible.

Selling Orlando homes isn’t a quick or easy endeavor. Especially now, aggressive marketers are the winners. Taking the time to clean and stage your home, as well as create a wide-reaching marketing campaign, can get that for sale sign taken down for good.

If you’d like to sell your home, let us create a strong, wide-reaching marketing campaign to get your home sold. Give us a call today at 407-876-5771.

With the many auctions here and throughout the U.S., you may be wondering if it’s worth buying Orlando real estate this way. Auctions let you bid at a public sale. Some property is being sold by the owner, but most properties are foreclosures being sold by banks.

Like any endeavor, there are pros and cons in buying Orlando real estate at an auction. For instance, a pro for auctions might be the price; you can often get great discounts on nice homes through an auction. However, you may get caught up in the fervor of the bidding process and pay more for a home than you ever intended.

The Condition of the Home may be Questionable
When you work with a real estate agent to buy a home in the traditional manner, you go through the home inspection process. This ensures the home is in sound structural condition.

In an auction, you have to go with the timeframe of the bidding process and most likely will not have time to get a home inspection performed. In fact, homes sold at auction are sold “as is.” That means no improvements will be made to the home, even if you had it inspected and found something wrong. Additionally, there’s no warranty and no legal recourse to get your money back if you find problems later.

Tax liens can be Costly
In foreclosure auctions, a property may have a tax lien. If you win the auction, you may then become responsible for the payment of the tax lien. It could be a small or large amount of money, but no matter the size, you may not be able to afford it on top of the cost of the house.

Large Payments in Short Timeframes
Lastly, consider that full payment may be required at the close of the sale; if not full payment, earnest money will at least be required. Because closing usually happens within a month of the auction, it’s always best to be pre-approved for your loan before you start bidding.

If you’re looking at Orlando real estate auctions for your dream home, do your homework first. You could end up with a fantastic deal, but, without enough information, you could also end up with a dead end.

If you’re looking for a great deal on a wonderful home, we can help. Call us today at 407-876-5771 for more information.

I’ve written several blog posts about the media and the damper (or spin) that they put on real estate related issues. In fact, it’s a spin that they put on just about anything that comes our way. Lately, I have heard way too much about Lady Gaga’s meat dress, and the Florida pastor that wants to burn the Quran—neither of which are stories that (in my humble opinion) deserve any media time. (Yet, ironically, here I am mentioning these stories yet again.)

Another slew of media hype has been associated with loan modifications and the government’s HAMP program. In 2009, this President touted that four million borrowers would be able to take advantage of this program. Yet earlier this year I reported that only 13 percent had actually successfully completed those HAMP modifications. Yes, the bank’s inability to process the paperwork in a quick and efficient manner is much to blame. And, sadly, the victim of Fannie Mae’s latest industry decision with regard to foreclosure will be the homeowner who is caught between a rock and a hard place waiting for the bank to address their loan modification while the investor is moving aggressively towards foreclosure.

I hold the media partially responsible. You bet I do. If they had not spent so much time publicizing these modifications, individuals who cannot and/or would not qualify would not be on that sinking ship.

I am also a little bit irritated about Time Magazine’s September 6, 2010 cover story entitled “Rethinking Homeownership.” I enjoy Time Magazine and this is an extremely well-written article and a good case is made for certain individuals to avoid homeownership as if it were the Plague. But, what does that negative spin do to our national economy? If that same story was reported in a tabloid, the results might be quite different. However, the long term impact of an article antagonizing homeowners as members of a ‘cult’ (the cult of homeownership) is really not going to help us get buyers off of the fence and into homes. The long term result of such an article could be a partial paralysis of the housing market.

Wall Street Journal did have a great rebuttal, and most folks are already aware of the great advantages of homeownership and purchasing a home right now: low interest rates, low prices, positive tax benefits, etc.

As real estate agents, we already face many challenges. Most of us took a huge cut in pay that began in 2007 when housing prices in many areas fell significantly. Additionally, many home buyers and sellers have trouble understanding that we do provide something of value: we know the contracts, we know the neighborhoods, and we know the best way to get a home buyer and/or seller the best deal possible. But, with sales people, in general, having getting a negative rep (think: used car salesman stereotype), our job gets pretty tough.

But, all in all, it is a great job. It is a thrill to help a young couple buy their first home and then help them to buy a larger one after they have two children. It is an amazing feeling to help a friend of a friend avoid foreclosure by negotiating their short sale. The folks that you meet along the way become long-lasting friends. For all of these reasons, I am able to get up every day and and do my job. It doesn’t matter whether Time Magazine maligns the market; I can take all the media spin.

The big question is…. can you?

Liked this post? Here are a few more of my past posts written on similar issues.

Real Estate Agent as Fine Artist or Graffiti Artist

Internet Quacks

Why Would You Eat the Kim Kardashian Salad?