What is the Home Affordable Foreclosure Alternatives Program?

The Home Affordable Foreclosure Alternatives Program (HAFA) is a program developed by the Federal Government and the State of Texas that provides a stream-lined, timely alternative to foreclosure for homeowners in Texas who are having difficulty keeping up with their mortgage payments. HAFA is intended to help homeowners who cannot keep up with their mortgage payments avoid foreclosure. The program provides homeowners with two options: a short sale or a deed-in-lieu of foreclosure. A short sale is when the homeowner’s lender agrees to accept less than the amount owed on the mortgage in a sale of the home. A deed-in-lieu of foreclosure is when the homeowner transfers ownership of the home to the lender. In both cases, the homeowner is released from liability for the mortgage debt. For both options, the homeowner must be eligible for HAFA, which includes meeting certain requirements, such as having a documented financial hardship and being current on their mortgage payments. Homeowners must also be ineligible for other mortgage assistance programs. Once a homeowner is approved for HAFA, they will receive financial assistance and guidance on the short sale or deed-in-lieu process. HAFA also provides financial incentives for the homeowner, lender, and any other servicing participants. These incentives may include a cash incentive for the homeowner, a payment for the lender, and a servicing fee for any other servicing participants. HAFA is a valuable resource for homeowners in Texas who are having difficulty keeping up with their mortgage payments. By providing financial incentives and guidance, the program helps to streamline the foreclosure avoidance process and provide a viable alternative to foreclosure.

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