Thanks to new updates to policy guidelines for the Home Affordable Foreclosure Alternative (HAFA) program, servicers must provide much more feedback and transparency during the decision process and some agencies will be permitted to buy HAFA homes and rent or flip them back to the original owner. The Treasury has established directives to bring about these changes in June of this year, but is in the process of encouraging servicers to being to implement required changes immediately rather than waiting. According to the new rules, servicers must provide written confirmation of receipt of request for short sale or deed-in-lieu within 10 days of receipt and must provide an answer or a status notice and explanation within 45 days of receipt. Furthermore, certain non-profit agencies will be exempt from the “arms-length” rules in the system and will be permitted to rent or sell properties back to the original owners following the HAFA negotiations.
HAFA has largely escaped the sights of republican congressmen and women targeting current programs that they believe are draining taxpayer money and doing little, if anything, to help homeowners. It appears that the Treasury believes that business will continue as usual at least within HAFA, and some politicians have called other foreclosure-aid program termination bills “dead in the water” as the president has promised to veto any such bills that make it through both houses of Congress.
Do you think that these changes in HAFA are good or bad for the housing market recovery?
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