What is the Home Affordable Foreclosure Alternatives Program?

The Home Affordable Foreclosure Alternatives Program (HAFA) is a legal program in Delaware that provides incentives for both homeowners and lenders to avoid the long and costly process of foreclosure. HAFA was created by the federal government in 2009 as part of the Making Home Affordable Program, which was designed to help homeowners avoid foreclosure and keep their homes. In brief, HAFA offers two primary foreclosure alternatives to borrowers whose loans are backed by the federal government. These include a short sale, where lenders approve the sale of the home for less than the total amount that is owed; and a deed-in-lieu of foreclosure, where the borrower turns over the deed to the property to the lender. In addition to providing these alternatives, HAFA also provides financial incentives to both homeowners and lenders. These incentives include waived deficiencies for homeowners, waived fees for lenders, and other forms of compensation. For homeowners facing foreclosure, HAFA gives them an alternative to the lengthy and costly process of a foreclosure. By providing financial incentives, the program also incentivizes lenders to avoid the lengthy foreclosure process and work with homeowners to find a solution. By avoiding a lengthy foreclosure process, the program helps both homeowners and lenders keep costs down and avoid a difficult financial situation.

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