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With the expansion of the Home Affordable Foreclosure Alternative to conforming loans, a host of companies have expanded their short-sale services.

National Creditors Connection Inc. announced this month the launch of a short sales desk to help servicers and investors determine whether defaulted borrowers should utilize HAFA.

Also expanding its services to accommodate HAFA was MOS Group Inc., which “is leveraging its proven, end-to-end, borrower-focused methodology, comprehensive employee training and education program and leading technology platform to assist HAFA-qualified borrowers throughout all phases of the short sale and deed-in-lieu of foreclosure process.”

MOS noted that it is a sensitive process transitioning a borrower, who was hoping for a modification, to a short-sale or deed-in-lieu. MOS says it can handle multiple phases of the process while remaining the servicer’s sole point of contact.

More than 10,000 HAFA requests have been assigned to Loan Resolution Corp. since the program was implemented on April 5, according to a June 8 press release. With the inclusion of Fannie Mae and Freddie Mac loans in the program, the firm expects assignments to double.

Loan Resolution, which says it focuses on the HAFA short-sale process, explained that servicers will be paid $2,200 for successfully resolving a short sale under the program.

Last month, ZENTA announced the implementation of an end-to-end, HAFA-compliant, short-sale program.

Nearly $3.4 billion in mortgages avoided foreclosures during the 12 months ended March 31 as a result of the efforts of Genworth Financial and its servicers, a recent press release indicated. The figure was 81 percent higher than a year earlier. Around $0.3 billion of the loans were in California, while the total was about the same for Florida.

Genworth said it helped complete more than 23,000 workouts, with short-sales accounting for 18 percent.

A short-sale certification program was announced last month by Equator, a software provider that caters to default servicers. The program is an effort to educate real estate agents about short sales. Equator said more than 55,000 short-sale listings are posted monthly on its platform.

In all, Equator said its platforms have handled more than $117 billion in transactions. More than 207,000 transactions are handled daily on its platforms, while 15,000 sellers are being hosted.

Short Sale RUSH author Marian Anthony is advising consumers that modifications build “a debt trap around the borrower who is emotionally attached to a property, milking the borrower for every last nickel,” while a foreclosure destroys credit. He advises against strategic defaults, which can leave the borrower with a deficiency balance, and says the short-sale process is wrongly viewed by real estate professionals as too complicated.

“One way to gain leverage with a lender is to establish a ‘substitute mortgage’ — a security pledge that is offered to the seller’s lender — with a third-party (lawyer or Escrow company) for a lesser amount of the current payment,” Anthony said in a statement. “Over time this will result in a significant amount of collected funds that can be used as negotiating leverage to release the borrower form the debt, or dictate terms for a loan modification in the borrower’s advantage.”

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