1. Module 5: Fannie & Freddie HAFA Programs 63 5-1

2. Fannie & Freddie Announced HAFA June 1, 2010 Effective August 1, 2010 Fannie & Freddie own the loans –Are the ultimate decision makers 63 5-2

3. Fannie & Freddie Eligibility Owner Occupied, 1-4 family $729,750 balance (SFR) 1 st position loans Originated pre 1-1-09 Payment exceeds 31% of gross income Hardship Delinquent or default reasonably foreseeable (Freddie requires borrower be more than 60 days delinquent) 63-64 5-3

4. Payment on 1 st Lien Exceeds 31% of Gross Income Includes: Includes: – PITI – Flood Ins., Condo Assn Fees & HOA Fees Does not include: Does not include: – Mortgage Insurance – Sub. lien payments Gross Income: Includes All Income 64 5-4

5. Time Frames From Time SSA Issued SSA returned within 14 days 120 days marketing period –Freddie requires minimum 15 days notice for extensions RASS & contract returned within 3 Biz days Approval or denial within 10 days 64 5-5

6. Fannie & Freddie Closings Servicer can’t require sooner than 45 days from contract execution Can be ASAP but… …no later than 60 days from contract 65 5-6

7. Fannie & Freddie Servicer Reimbursement $2,200 to servicer 65 5-7

8. Standard Documents SSA –Fannie has different order –Some significant differences RASS –Same as Treasury’s Alt. RASS –Same as Treasury’s but… –None for Freddie Mac 65 5-8

9. Fannie Mae’s HAFA Program 66 5-9

10. FNMA Additional Requirements Must qualify for HAMP Modification before requesting short sale 66 5-10

11. FNMA Additional Requirements (cont’d.) Can make payments Has high surplus income Has substantial assets –3 x monthly payment or –$5,000 whichever is greater 66 Borrower Not Eligible if: 5-11

12. Substantial Asset Examples Substantial Asset Examples Payment: $1,500 x 3 = $4,500 Liquid assets can’t exceed $5,000 Payment: $2,200 x 3 = $6,600 Liquid assets can’t exceed $6,600 66 Freddie Mac has same Asset Test 5-12

13. Special Permission Required to Consider Borrower for HAFA Special Permission Required to Consider Borrower for HAFA Foreclosure sale within 60 days of short sale request Foreclosure proceeding could start and finish within 60 days Certain Florida foreclosure situations 67 5-13

14. How Fannie Mae Determines Price & MANP Recent BPO Approved Fannie Mae vendor List price based on MANP MANP –Minimum Acceptable Net Proceeds –Not disclosed to seller or broker –Cannot be increased after SSA executed 67 5-14

15. Commissions & 3 rd Party Fees Allows commissions per listing May not exceed 6% No 3 rd party fees paid by FNMA 68 5-15

16. Listing Agent & Servicer Duties Establish list price Ensure marketing plan Monthly feedback Monthly comps Adjust price as needed 68 Other FNMA Differences 5-16

17. Listing Agent & Servicer Duties (cont’d.) Review sale contract as to HAFA compliance Resolve title issues Provide closing instructions 69 5-17

18. Freddie Mac HAFA 69 5-18

19. Freddie Mac HAFA Details Similar to Treasury’s & Fannie’s No Alt. RASS 69 5-19

20. No Alt. RASS with Freddie Mac Sales contract received but seller not in HAMP B-65 (Non-HAFA) short sale No Alt. RASS 69 5-20

21. Required Monthly Payments 31% of gross income Non-payment not sole grounds for termination 69 5-21

22. The REALTOR’S® Role REALTOR® knowledge & assistance critical Learn the programs HAFA extended thru 2013 70 5-22