On November 1, the Home Affordable Foreclosure Alternatives (HAFA) Program released Supplemental Directive 12-07: Home Affordable Foreclosure Alternatives Program – Policy Update.

The policy update was made in order to better align the Home Affordable Foreclosure Alternatives (HAFA) Program with the recent changes made by Fannie Mae and Freddie Mac to their streamlined short sale program.

Generally, the changes to the HAFA program will become effective February 1, 2013, however, servicers may begin implementing changes immediately.

These changes to the HAFA program do not apply to mortgage loans that are owned or guaranteed by Fannie Mae or Freddie Mac, insured or guaranteed by the Veterans Administration, insured or guaranteed by the Department of Agriculture’s Rural Housing Service or the Federal Housing Administration.

This revised Supplemental Directive covers the following topics:

• Program Cut-Off Date
• HAFA Matrix
• HAFA Documentation
• Consideration of Borrowers Requesting a Pre-Approved HAFA Short Sale or DIL
• Pre-Approved HAFA Short Sale Effective Date and Duration
• Terms of Pre-Approved HAFA Short Sale
• Responding to a Sales Contract Subject to a Pre-Approved HAFA Short Sale
• Responding to a Sales Contract Prior to Pre-Approval of a HAFA Short Sale
• HAFA Affidavit
• Relocation Assistance
• Limitations on Resale
• DIL
• Investor Reimbursement of Subordinate Lien Release
• Reporting

If you want to get into the nitty-gritty, check out the policy update here (drink a triple espresso before reading).

(photo credit)