Module 5: Fannie & Freddie HAFA Programs 63 5-1. Fannie & Freddie Announced HAFA June 1, 2010...
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Transcript of Module 5: Fannie & Freddie HAFA Programs 63 5-1. Fannie & Freddie Announced HAFA June 1, 2010...
Fannie & FreddieFannie & Freddie• Announced HAFA June 1, 2010
• Effective August 1, 2010
• Fannie & Freddie own the loans– Are the ultimate decision makers
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Fannie & Freddie EligibilityFannie & Freddie Eligibility• Owner Occupied, 1-4 family
• $729,750 balance (SFR)
• 1st position loans
• Originated pre 1-1-09
• Payment exceeds 31% of gross income
• Hardship
• Delinquent or default reasonably foreseeable (Freddie requires borrower be more than 60 days delinquent)
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Payment on 1Payment on 1stst Lien Lien Exceeds 31% of Gross IncomeExceeds 31% of Gross Income
• Includes:Includes:–PITI PITI –Flood Ins., Condo Assn Fees & HOA Flood Ins., Condo Assn Fees & HOA
FeesFees
• Does not include:Does not include:–Mortgage InsuranceMortgage Insurance–Sub. lien paymentsSub. lien payments
Gross Income: Includes All Income
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Time FramesTime FramesFrom Time SSA IssuedFrom Time SSA Issued
• SSA returned within 14 days
• 120 days marketing period– Freddie requires minimum 15
days notice for extensions
• RASS & contract returned within 3 Biz days
• Approval or denial within 10 days
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Fannie & Freddie ClosingsFannie & Freddie Closings• Servicer can’t require
sooner than 45 days from contract execution
• Can be ASAP but…
• …no later than 60 days from contract
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Fannie & Freddie Fannie & Freddie Servicer ReimbursementServicer Reimbursement
• $2,200 to servicer
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Standard DocumentsStandard Documents• SSA– Fannie has different order– Some significant differences
• RASS– Same as Treasury’s
• Alt. RASS– Same as Treasury’s but…– None for Freddie Mac
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FNMA FNMA Additional RequirementsAdditional Requirements
• Must qualify for HAMP Modification before requesting short sale
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FNMA FNMA Additional Requirements Additional Requirements (cont’d.)(cont’d.)
• Can make payments
• Has high surplus income
• Has substantial assets– 3 x monthly payment or– $5,000 whichever is greater
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Borrower Not Eligible if:Borrower Not Eligible if:
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Substantial Asset ExamplesSubstantial Asset Examples
• Payment: $1,500 x 3 = $4,500
• Liquid assets can’t exceed $5,000
• Payment: $2,200 x 3 = $6,600
• Liquid assets can’t exceed $6,600
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Freddie Mac has same Asset Test
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Special Permission Required to Special Permission Required to Consider Borrower for HAConsider Borrower for HAFAFA
• Foreclosure sale within 60 days of short sale request
• Foreclosure proceeding could start and finish within 60 days
• Certain Florida foreclosure situations
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How Fannie Mae Determines How Fannie Mae Determines Price & MANPPrice & MANP
• Recent BPO
• Approved Fannie Mae vendor
• List price based on MANP
• MANP–Minimum Acceptable Net Proceeds– Not disclosed to seller or broker– Cannot be increased after SSA executed
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Commissions & 3Commissions & 3rdrd Party Fees Party Fees
• Allows commissions per listing
• May not exceed 6%
• No 3rd party fees paid by FNMA
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Listing Agent & Listing Agent & Servicer DutiesServicer Duties
• Establish list price
• Ensure marketing plan
• Monthly feedback
• Monthly comps
• Adjust price as needed
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Other FNMA Other FNMA DifferencesDifferences
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Listing Agent & Listing Agent & Servicer Duties Servicer Duties (cont’d.)(cont’d.)
• Review sale contract as to HAFA compliance
• Resolve title issues
• Provide closing instructions
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Freddie Mac HAFreddie Mac HAFAFA Details Details• Similar to Treasury’s & Fannie’s
• No Alt. RASS
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No Alt. RASS No Alt. RASS with Freddie Mac with Freddie Mac
• Sales contract received but seller not in HAMP
• B-65 (Non-HAFA) short sale
No Alt. RASS
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Required Monthly Payments Required Monthly Payments
• 31% of gross income
• Non-payment not sole grounds for termination
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The REALTOR’S® RoleThe REALTOR’S® Role
• REALTOR® knowledge & assistance critical
• Learn the programs
• HAFA extended thru 2013
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