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HELOC declined HAFA

Posted by Miriam on September 26, 2011 at 2:54pm in Short Sale Discussions

We (the sellers) were approved for HAFA by Chase with no issues, but we were declined by Regions Bank. Would not accept the 6% of 7800.00 HELOC. We are going to go the traditional short sale route. My quesiton is do we have to start from scratch? Chase has all our paperwork, the BOP is done.  We have THREE offers in the wings at or near the BOP. There will be a 30,000 deficiency on the first and 7800.00 on the HELOC before negotiations.

Already been through the ringer, can't take it much longer!

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Replies

  • Lee Cravens September 28, 2011 at 8:22am
    Miriam,  sometimes with hafa just write in 6K on your hud to the second not just 6%.  first will sometimes ok it. I know they are stupid and should grab it but lender mentality prevails. 
  • Kimberley Kelly September 28, 2011 at 1:45am

    This is goofy.   HAFA, from what I understand states that there is no longer a 6% amount paid to 2nd, but the $6000 cap is still there.  For your HELOC, I cannot see why they wouldn't take that and go.  This is a very small deficiency on the first note and your HELOC.  Something not right here.  HAFA is a pain, but CHASE is worse..whether HAFA or standard SS.  I just got one of theirs approved, but it was painful..always are with them.

     

     

  • Miriam September 27, 2011 at 6:01am
    Yes,only one was signed. It was the first we received. All the offers were for asking.
    • Jeff Payne > Miriam September 27, 2011 at 10:06am
      Good :)  Work that one til the end! 
  • Miriam September 27, 2011 at 5:32am
    Let me clarify and clear up some confusion. Not sure where the impression that we were turning in unsigned documents came from. We have 3 offers in the wings. We could not sign until approved by Chase/Freddie for HAFA. As far as they are concerned, they do not know we have potential buyers. Once the BOP is set, then we would sign the contracts and turn them in as an offer. You cannot have a signed contract before being approved for a Freddie HAFA.Basically, we told our the potential buyers that if they were willing to wait, once HAFA was approved we could negotiate the contract. There was never any intention of turning in unsigned documents.

    Now that we have been declined for HAFA, we have all just signed our parts accepting the offer this morning, and
    they are on their way to Chase.

    I am now on the road, and am not able to pull up the Freddie PDF's but here is a link to a discussion similar to our own.

    http://www.theshortsaleguide.com/forum/topics/freddie-mac-hafa-loop...
    • Jeff Payne > Miriam September 27, 2011 at 5:40am

      Please tell me that you only signed one of the three offers!  I recently closed a Freddie HAFA that we submitted the signed contract before we had any approval.....

      HAFA is a joke, all is does is drag out the approval times..

  • Miriam September 27, 2011 at 4:26am
    The guideline is not new. The information is located on their website. Here is the direct link.(section 5)

    http://www.freddiemac.com/singlefamily/service/docs/hafa_servicer_q...

    Its also mentioned on the below link under HAFA solicitation.

    http://www.freddiemac.com/singlefamily/service/hafa.html

    Our realtor has confirmed this with both Chase and Freddie.
    Their guidelines are somewhat different than traditional. The recent changes to the non Freddie/Fannie HAFA do not apply.Also, Freddie does still only allows 6% to the second with a max of 6,000 whereas the traditional lifted the 6% cap. In our case that is a whopping $474.00
    • Smitty > Miriam September 27, 2011 at 4:46am

      Miriam, none of the links you provided state offers are to be submitted unsigned.  Can you provide an acutal link to the guideline?

       

      I would be VERY CAREFUL if this is what your Realtor has told you to do.  I've worked many short sales and if by chance there was a missing signature, it was either rejected or I got a call from the negotiator.

    • Jeff Payne > Miriam September 27, 2011 at 4:36am

      Well it is a guideline that they do not follow, I can tell you that I have closed 2 HAFA sales, one with Freddie and one with Fannie and we had had a signed contract BEFORE submitting anything.  Keep in mind that if you have an offer that is not signed, no matter what Freddie says, you do not have a legal and binding contract, you have an offer.

      I just glanced thru this but did not see anywhere that said you should not sign an offer?  Where does it say that?  

  • Smitty September 27, 2011 at 1:31am

    Why aren't the offers signed?  Your agent should have an executed contract with at least one of the buyers. You need at least ONE executed contract before submitting to Freddie/Chase.

     

    What did Regions Bank want for a payoff?  I am currently working a Chase loan.  They said if I didn't pursue HAFA they were going to ask for money at closing from my clients or retain their rights for deficiency.  Your agent should have told you that second lien holders are not required to participate in HAFA and you may be required to bring $$ to closing.

     

    I'm not a fan of HAFA by any means, but if by unenrolling in HAFA and going the traditional route Chase retains their right to pursue a deficiency or asks you for money at closing, it may have been worth paying off the second or working out a deal. 

     

    Sorry.  Chase is my least favorite lender these days.  What happened with Regions??

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