Important to Know: Treasury Answers Three HAFA Questions

June 3, 2010

Source: Jeff Lischer and Tony Hutchinson
Phone: (202) 383-1117

On May 21, 2010, Fannie Mae, on behalf of the Treasury Department, answered three HAFA questions submitted by NAR on behalf of its members. HAFA is the Home Affordable Foreclosure Alternatives Program that provides uniform procedures, forms, and deadlines for short sales and deeds-in-lieu of foreclosure. The purpose of HAFA is to help homeowners avoid foreclosure even if they are unable to retain the home with a loan modification under the HAMP program.


Rebates from REALTORS®
Q: Is it permissible for the buyer agent to rebate (either a % or fixed dollar amount) to their clients? (the buyer may use it towards closing costs or to purchase items after closing)

A: No, under HAFA this is not permitted as the RASS states neither the borrower nor the buyer will receive any funds or commissions from the sale of the property.

ARM-length Transaction
Q: May sellers who are real estate agents list with their broker?

A: No, this would violate the arm's length transaction provision that prevents the seller from listing the property with anyone they have a close personal or business relationship with. This is an anti-fraud provision. If the property is listed by an agent with their broker the risk of an "incentive" being paid and the seller profiting from the transaction increases.

Subordinate Lien holders
Q: Payments to Junior Lien Holders. Can another party (seller, agent or buyer) make a payment to the 2nd lien holder to release the borrower/seller in addition to the 6% or $6000 cap?

A: The 6% or $6000 limit to pay off subordinate lien holders is a hard cap and [it] does not matter who pays the money.

Click here for a link to NAR's Short Sale Web Page

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