SECOND lenders do not have to participate in the HAFA program so even though it’s Chase or Wells or whoever the second lender is and they independently participate in the HAFA program as a second lender on the property they do not have to comply with the HAFA program. The agent’s going into these short sales didn’t realize that. Not only were the agent’s furious about the homeowners, the lenders in both cases CUT the commission to get an approval. Imagine that? A short sale lender cutting an agent’s commission? Well THERE’S something you don’t see every day right? WRONG!!
An approval of a short sale actually comes in writing. So unless a previous buyer had come in, put an offer in, got an approval and walked before closing, chances are the SHORT SALE APPROVED on the listing you read just means that the listing price has been approved by the lender.
Homeowner should know the risks of a potential “traditional” short sale. There is a new type of short sale called a HAFA short sale that has other risks all together, so for today, our focus is the traditional short sale.
First, what Massachusetts and New Hampshire homeowners should know is that those states are recourse states. What this means is the lender CAN pursue a homeowner for any deficient amount.