Fannie Mae Short Sale Guidelines

The HAFA program simplifies and streamlines the use of short sale and deed-in-lieu options by incorporating the following features:

-Complements HAMP by providing viable alternatives for borrowers who are HAMP eligible.
-Utilizes borrower financial and hardship information collected in conjunction with HAMP, eliminating the need for additional eligibility analysis.
-Allows the borrower to receive pre-approved short sale terms prior to the property listing.
-Prohibits the servicer from requiring, as a condition of approving the short sale, a reduction in the real estate commission agreed upon in the listing agreement.
-Requires that borrowers be fully released from future liability for the debt.
-Provides financial incentives to borrowers, servicers and investors.

The new rules will be effective April 5, 2010, but participating servicers may elect to implement HAFA prior to that date in accordance with the directive. In order to participate in HAFA, a servicer must have executed a HAMP Servicer Participation Agreement (SPA) by Dec. 31.