This is California....the property is being purchased by the tenant, so therefore I have not requested the 3k relocation allocation. What the negotiator is suggesting is that if we do not take the funds, then we will have to opt out of HAFA. I have never not requested the relocation, so this is new to me. Does anyone know for sure? If the tenants sign the affidavit to make it easy, then they are committing fraud because they will not be moving out...the will be the new owners.

"Since the  $3000 relocation assistance is not been requested, borrower can opt out  of HAFA program,. we would need a signed letter from the borrower stating that they do not wish to participate in the HAFA short sale. if they cannot provide this letter  this letter,  they will need to send the required HAFA docs(rental agreement for subject property and completed hafa tenant certification). Or if prop is now vacant they would check that vacant on the HAFA Arass. I  need any of these docs. Once any of these docs are received, i will then be able to write up this deal and submit to my supervisor for approval. The sale date is 10/5/12 and no postponement will granted on the foreclosure anymore since we have reached our postponement limit. I need the required docs asap. Thanks!!"

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I just had a negotiator tell me today that you don't need the HAFA incentive money to take part in HAfA. That the main thing is getting deficiency waived!

I am not familiar with the tenant agreement - assume that is where you have the dilemma.  Banks seem to tiptoe around the HAFA boondoggle rules at times so I try to do whatever comes closest to the norm.  This seems to be another area not properly considered by the politicians who put HAFA together. Notice, for instance, that they never have corrected the RMA for the seller where he has to agree that he doesn't plan to move out for the next 12 months - instead of changing that, the banks tell you to ignore it. Really? The seller is signing that he isn't lying and does not plan to move out in the next 12 months..?? Every HAFA seller had to sign that lie.  on demand of the bank.

If you don't get this resolved another way, how about having them move out for the day of closing? Take the $3K and get a truck to take some furniture around the block. Personally, I'd rather do that than sign false statements or rock the HAFA boat of what they expect as normal - and it would be honest. Hey, maybe spend the night in a nice hotel during the move..??

A couple of things to consider. First, you can not have an arms length transaction with a tenant who currently has a lease. Secondly the HAFA is primarily for the primary residence, with just a couple of exceptions. I would suggest you look at the type of loan, purchase money or cash refi. California has some great non-recourse, anti deficiency laws that should help if the borrower qualifies. It is all about how the approval letter is written. Based on the info you gave, it does not look like it would qualify for HAFA.

Whats the problem?  Take the $3,000.  I always put $3,000 and if they are not living in the property its called a 'Borrower Cooperation Check'   :)

Part of HAFA is a guaranteed $3,000.  Its there for the taking and there's no where to put it otherwise.

Or are you are talking about the borrower remaining a tenant in the property after the sale?  If thats the case it should be in writing on an addendum somewhere if it was an issue.

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