The Making Home
Affordable Program (MHA), has been formally extended 1 year, through December
31, 2016, by Supplemental
Directive 15-04. The program has been
widely successful in providing affordable alternatives to foreclosure for millions
of homeowners nationwide, and the extension through 2016 will provide relief to
the millions more who will be in danger of falling behind on their mortgages in
the next year.
This extension applies only to mortgages that are not owned
or guaranteed by Fannie
Mae or Freddie Mac and for applications
that are submitted to the Lender on or before December 31, 2016. Though it is
not necessary to have a decision on the application for a loan modification,
short sale, or deed-in-lieu by the end of 2016 to be eligible under the MHA program,
the transaction must close on or before September 30, 2017 if the borrower
would like to receive incentive compensation, such as relocation assistance, payments
for successfully completing a short sale or deed-in-lieu, or payments for
making timely loan modification payments. Since the amount of relocation
assistance that Lenders must offer has increased from $3,000 to $10,000 for all
HAFA (short sales & deeds-in-lieu) transactions closing on or after
February 1, 2015, borrowers must be mindful of the deadlines so that they may be
eligible to receive this increased amount to assist them in moving costs.
This Directive
also amends the MHA
guidebook to allow servicers to establish a cap on the amount that they
will pay to release the second mortgage liens, as long as the cap is not less
than $12,000. It establishes a floor amount that borrowers may receive from
their primary mortgage lenders to assist them in closing on their short sales
or deeds-in-lieu.
These amendments ensure that borrowers will continue to have
access to adequate relief through the MHA program.
