This is direct from the HAFA Website:
HAFA is an acronym for Home Affordable Foreclosure Alternatives, a government-sponsored program that helps individuals and families who are experiencing difficulty in selling their homes. In conjunction with the Home Affordable Modification Program (HAMP), HAFA was initiated on November 30, 2009 by the U.S. Treasury Department under the Obama Administration with the goal of revitalizing the housing market.
Via the program, borrowers are provided incentives that will help them take advantage of either a short sale, whereas the borrower and the mortgage servicer agree to sell the home for less than the value of the loan; or a deed-in-lieu of foreclosure, whereas the homeowner voluntarily gives the deed of the property to the servicer.
HAFA complements HAMP as an alternative for eligible borrowers, but does not apply to loans that are affiliated with Fannie Mae or Freddie Mac. Reportedly, these organizations have plans to release their own versions of HAFA in the near future.
In simpler terms, HAFA helps people quickly sell their homes by giving them pre-approved short sales terms before listing the property. They are fully released from future liability for the first mortgage debt, and can receive $3,000 for borrower relocation assistance. Investors and servicers can also receive financial assistance through the program for administrative costs, processing fees, etc. The program sounds simple, but is actually quite complex with many guidelines and rules.
Although the program was initiated in November 2009, it officially began on Monday, April 5, 2010 and will end on Monday, December 31, 2012. Experts say that if the program is successful, it will likely be extended and the terms may be adjusted for more to qualify.
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