Avoid Foreclosure with a HAFA Short Sale

The concept of a home foreclosure isn’t something most borrowers think about when they first purchase their home. Unfortunately, the possibility is real, and the bank’s foreclosure action can cause numerous ugly financial ramifications.

A short sale is basically selling a home for less than it’s worth. It’s a distressed sale, and it should only be performed as a last resort. HAFA Short Sales are the exception to this rule, and it can provide borrowers suffering hardships with well needed support.

With a non-government backed short sale, a borrower would be responsible for paying any deficiencies between the amount owed and the amount the property was sold. With the federal government’s Home Affordable Foreclosure Alternative (HAFA) short sale program, borrowers are forgiven for any remaining loan deficiencies.

This is a great program, and it can help to alleviate the consequences of a defaulted loan, specifically creditor harassment and the negative impact on a credit report.


A Few Quick HAFA Short Sale Benefits:

  • Deficiency is waived
  • Homeowner can receive $3,000 at closing for relocation assistance
  • No cash contribution or promissory note required
  • Foreclosure process put on hold

Borrowers will need to qualify for this federal program. Following are a few of the requirements, but a foreclosure specialist should be used to guarantee eligibility.

HAFA requirements for eligibility

  • Homeowner is delinquent or default is reasonably foreseeable
  • Homeowner has a documented hardship
  • Homeowner has:
    • Exhausted all modification options, and/or
    • Decided to pursue a short sale or deed-in-lieu of foreclosure
  • Property is the homeowner’s primary residence
    • Property can be vacant or rented up to 12 months prior to the Short Sale Agreement, as long as the borrower can prove the property was the primary residence and has not purchased another home in the last 12 months
  • First Mortgage was originated on or before January 1, 2009 and is less than $729,750
  • Homeowner has not been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering, or tax evasion, in connection with a mortgage or real estate transaction.


To find out if you are eligible for a HAFA Short Sale in Utah or should you have any questions about the services we provide, contact us by Phone at (801) 432-8682 or email.


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