You've been hearing about the banks' relocation incentive for a few years now, but I'm sure a lot of people aren't sure if they really DO get the money at the end of the short sale.
Rolled out by the Department of the Treasury in 2009, HAFA (Home Affordable Foreclosure Alternatives) was designed to help homeowners who are unable to keep their homes through loan modification with either a short sale or deed-in-lieu of foreclosure.
The original relocation incentive was $3,000, but saw a dramatic increase to $10,000 in February 2015.
Homeowners that complete a HAFA short sale receive a check for $10,000 at closing. You must be living in the home at the time of submission of the short sale, and the bank will require proof of occupancy. This is provided through a major utility bill (electric, water or gas) with your name and home address on it. If you are not living in the home, and are renting it out or have a relative or friend living in the home, the occupant will be eligible to receive the $10,000.
Moving can be expensive, and with compromised credit, having the $10,000 at the closing of a short sale can make the transition so much easier. I have so many clients who are so thankful for that extra money, and $10,000 is a substantial sum.
Keep in mind, you must submit your short sale package prior to having a foreclosure sale date set. If you DO have a sale date, the only way to get into a HAFA short sale is to get the bank to put the sale date on hold, or at least postpone the sale for 60 days.
I would say about 85% of the short sales that I've submitted are HAFA qualified. Most lenders and investors do participate, and you may be missing out on an opportunity to make that fresh start if you let this program pass.
Right now, the deadline to submit for a HAFA short sale and it's $10,000 incentive is December 31, 2016. It has not been extended yet, but I will let you know if it does!
Please call me to see if your bank is participating and if you qualify for the $10,000 HAFA incentive.