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Wells Fargo HAFA Matrix

Wells Fargo HAFA Matrix

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Published by: Kevin M. Lancaster Willson on Oct 20, 2011
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All servicers that have signed agreements with the U.S. Department o the Treasury (Treasury) to participate in theHome Aordable Modication Program (HAMP) must consider eligible borrowers who do not qualiy or HAMPor other oreclosure prevention options including Home Aordable Foreclosure Alternatives (HAFA) whichincludes short sale and deed-in-lieu. However, each servicer has some discretion in determining additional eligibilitycriteria and certain program rules. In order to assist borrowers and their representatives in understanding anyunique components o a servicer’s HAFA Policy, Treasury, has developed this HAFA Matrix.The summary inormation in this matrix is prepared solely by Wells Fargo and does not represent anydetermination by the Treasury as to the servicer's compliance with the Treasury's policies and guidance or HAFA.Treasury does not endorse any language or policy described in this matrix. Any questions regarding the inormationcontained in this matrix should be directed solely to Wells Fargo.
Wells Fargo Home Aordable Foreclosure Alternatives(HAFA) Matrix
Treasury's guidelines state that a loan meets the basic eligibility criteria i the servicerveries that all o the ollowing conditions are met:
The property is the borrowers primary residence
The mortgage is a rst lien originated on or beore January 1, 2009
The mortgage is delinquent or deault is reasonable oreseeable
The current unpaid principal balance is less than or equal to: $729,750 or a one-unit property $934,200 or a two-unit property $1,129,250 or a three-unit property $1,403,400 or a our-unit property
The borrower’s total monthly mortgage payment exceeds 31% o their gross income(only applicable i required by investor or insurer.)
The property is not vacant or condemned. (The property may be vacant providingcertain conditions have been met and can be validated by independent third partydocumentation.)
Additional important items to note:
Treasury requires that a borrower have a documented nancial hardship, evidenced by asigned Hardship Afdavit or RMA, wherein the borrower has represented that he or she doesnot have sufcient liquid assets to make the monthly mortgage payments.I a borrower is current or less than 60 days delinquent and would like to be considered, theymay still be eligible pending urther review o their nancial situation.
Loans with a scheduled oreclosure date may still be considered or HAFA depending on thetiming o the scheduled oreclosure sale.Please note that in addition to Treasury’s standard HAFA eligibility requirements, WellsFargo must adhere to investor and mortgage insurance guidelines as well as all applicablelaws and regulations
Documents required prior to Short Sale Agreement (SSA):
Hardship Afdavit/RMA
Dodd Frank Certication
Conditional items based on investor requirements, imminent deault, and/or otherpotential actors, or example: Evidence o residency in subject property. Financial inormation (paystubs, bank statements, etc) Documentation o hardship when required
Documents required i a purchase ofer has been made:
Same documents as above, plus:
Alternative Request or Short Sale (i no SSA exists) or Request or Short Sale (i SSA exists)
Purchase Agreement and Estimated HUD-1
Proo o buyer unds or buyer’s pre approval or commitment letter on lender letterhead
Second lien holder's written approval and agreement not to pursue deciency balance
Other documents per investor and insurer request
Establishing property value
Valuation is obtained based on investor guidelines and typically consists o an interior BPOor ull interior appraisal. The valuation must be less than 90 days old at the time the ShortSale Agreement is issued.
Disputed valuations
Wells Fargo ollows both its service provider and investor guidelines when determining whatinormation is needed to dispute a value. A minimum o three sold comparables must besubmitted. These must be comparable to the subject property's square ootage, amenities,age and location, and must have closed within six months prior to the eective date o thedisputed valuation. I the dispute is based on repairs, an estimate o repairs prepared by alicensed contractor is required.
Periodic reassessment o value
We order a new valuation every 90 days during the HAFA process. I the new value comesin lower, we will reduce the MNSP accordingly. I the new value comes in higher than theprior value, we will not change the MNSP.
Payments duringmarketing period
None required

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