Real Estate Blog

Automated Short Sales Coming Soon

March 2nd, 2010 3:34 PM by Sherry Lee

Automated Short Sales on the Way as HAFA Nears
by JON PRIOR Tuesday, February 23rd, 2010, 11:23 am

The Home Affordable Foreclosure Alternatives (HAFA) program will launch on April 5, 2010, and everyone from asset management companies to software providers are rushing new products to the front lines.

HousingWire broke the story on HAFA in October when the US Treasury Department announced the program. HAFA was designed to provide incentives to servicers that provide short sales and deeds-in-lieu of foreclosures to borrowers who do not qualify for a loan modification through the Home Affordable Modification Program (HAMP). The Treasury aims to help 3-to-4m borrowers through HAMP, which launched in March 2009. Through January 2010, participating servicers provided 116,000 permanent modifications.

Laurie Maggiano, the Chief of the Homeowner Preservation Office at the Treasury, told HousingWire that there are no current estimates for how many borrowers will receive a short sale through HAFA because of there are so many external factors to consider.

With documentation difficulties slowing progress in HAMP, servicers are gearing up for the wave of short sale inquiries on the way in April. MOS Group, a loss mitigation service provider, provides support through a HAFA team that will reach out to borrowers in the mandatory 30 days after a HAMP modification rejection.

“In a situation like this, where the borrower has been declined a loan modification, it’s imperative to communicate and follow up with the borrower quickly and effectively, as this first conversation can often mean the difference between a successful short sale transaction and one that falls into foreclosure,” said Greg Hebner, president of MOS Group.

Equator, which in its prior lift as REOTrans became the largest vendor management platform used by real estate owned (REO) departments across the country, released an agent-initiated short sale feature that allows real estate professionals to directly request a short sale on behalf of a client.

Lenders can enable the agent-initiated feature within the Equator network platform, which the firm says will help lower call volumes and connect the decision makers quicker.

“Traditionally, requesting a short sale meant borrowers had to call their lender, which was often a time-consuming process,” says Chris Saitta, CEO of Equator. “Now agents can now provide the additional service of requesting a short sale directly through Equator. This makes it easier for the borrower, and speeds up the process considerably.”

Chrisley Asset Management (CAM), the default manager, will provide short sale and loan modification services to lenders. CAM will work as a liaison between the borrower and the lender or servicer. When pursuing a short sale or a loan modification, brokers, attorneys and even the borrowers complain of a lack of communication.

Rasheeda Shears of CAM said that not only would borrowers and agents be able to communicate with a CAM liaison to get word back from the banks, but it would be the same representative for each account.

Even online auction sites are getting into the HAFA rush. REA Accelerated Marketing Group, a California-based online real estate bidding platform, formed a partnership with the short-sale technology provider National Quick Sale to “broaden the exposure” of short sale listings and complete more transactions.

“Short Sales are a great alternative to foreclosures, but without a comprehensive automation solution many servicers have simply avoided them,” Equator’s Saitta said.

Write to Jon Prior.

Posted in:General
Posted by Sherry Lee on March 2nd, 2010 3:34 PM



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