Freddie Mac HAFA- Unemployment Benefits Question

My buyer is currently in escrow on a property where the sellers are both on Unemplyment. The sellers are trying to do a HAFA short sale and the investor is Freddie Mac. The servicer is saying the sellers are not eligible for HAFA because they are receiving unemployment benefits. Has anyone else heard of this, how did you overcome it. Our short sale processor requested where in the guidelines this is stated, still haven't received anything. Thanks for the words of wisdom.

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Replies to This Discussion

Permalink Reply by Wendy Smith on June 18, 2012 at 11:08am

that's a new one on me.  Can the servicer cite which part of the HAFA guidelines support that position?

Permalink Reply by Laura Marshall on June 18, 2012 at 4:56pm

I had this happen last year, and it was the same for a Fannie Mae HAFA that I was trying to do. I "reached out" to Fannie Mae and was told that the servicer was interpreting the guidelines correctly. This is what I understand their thinking to be. They first must determine if the borrower qualifies for a loan modification. If not, they can do the HAFA short sale. If they are unemployed, they can NOT be considered for a modification, therefore they can not be considered for the HAFA short sale with a relocation allowance. I stated that their guidelines also states that the borrower can simply request a short sale. I was told by multiple servicers that they can request it, but due to unemployment, there is no possible modification therefore no HAFA. Who more than an unemployed borrower needs the relocation allowance ? Also, with Freddie Mac, the HAFA portion will be denied if there is an offer on the property at the time you begin the short sale process. It needs to be started prior to submitting an offer.

Permalink Reply by Beverly Cibulsky on June 18, 2012 at 4:07pm

I agree with Wendy, there must me something more to this, you can get HAFA if you have a normal job. Thinking it may be more along the lines that they have perhaps too much "savings", are not owner occupants, etc. Regardless, they can attempt a regular short sale. I am curious who the "servicer" is?

Permalink Reply by Jennifer Garrell on June 19, 2012 at 8:56am

Thank you so far for your help. The servicer is GMAC, from what I understand the sellers do not have reserves and are really struggulling to stay afloat outside of the housing expence. This is their only home as well. My buyers offer has not been submitted to the bank yet, but we are ready to do so once an SSA is issued (if issued). Thanks again for the help!

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