HAFA Short Sale -- Payment to Tenants?

Question

I'm working with an agent on a short sale with Chase. The agent mentioned a rather interesting arrangement...the property is tenant occupied right now and they don't want to move. The agent said it is a HAFA short sale and the tenants will get $3000 payout and move out if the short sale goes through.

I did a search on BP and didn't see anything on payout to tenants on HAFA short sales.

Any comments?

Thanks

Casey

I did a search on BP and didn't see anything on payout to tenants on HAFA short sales.

Any comments?

Thanks

Casey

KC Zhang · Answer

Thanks for the replies. I guess this is the agent's way to compensate  the tenants for letting him showing the property to potential buyers. Will I be liable to force the tenants out when I take position of the property?

Thanks

Casey

Betty Prejzner · Answer

The new, revised HAFA rules allow $3K payable to tenants for relocation expenses but only if they move out. If they intend to stay they are not eligible.

Mark H. · Answer

The reason you're not seeing anything on payouts to tenants oh HAFA short-sales, is because HAFA isn't designed as an investor bailout.  The key qualifier for a HAFA short-sale is that the property must be owner-occupied or vacant due to a recent job transfer (less than 12 months).  The $3k comes from the government (not chase).

The situation you're observing is either a fraud against the government, or a very slick interpretation of the rules.  Chase has been playing fast and loose with the rules lately, I've heard of $40k incentives to investors for being deadbeats, so it isn't surprising, although it is infuriating as a taxpayer who gets to subsidize someone else's failed investment.