HARP 2 Refinance Options No Matter How Far Underwater: QUALIFYING CHECKLIST

[BELOW ARE GUIDELINES AT A GLANCE. AND HERE’S A HARP GUIDELINE UPDATE APRIL 12, 2013]

Homeowners too far underwater to refinance up to now have new hope today. The Federal Housing Finance Agency (FHFA) today announced key changes to their refi assistance program called Making Home Affordable—or sometimes also called Home Affordable Refinance Program (HARP).

Below is a revised refi eligibility checklist for underwater homeowners:

-Condo and single family home loans are eligible.

-Your loan must be owned by Fannie Mae (check) or Freddie Mac (check).

-Your loan must have closed on or before May 31, 2009.

-Your loan balance must be greater than 80% of your home’s value.

-If your new HARP loan is a fixed rate loan, it doesn’t matter how much your loan balance exceeds your home’s value.

-If your new HARP loan is an ARM, your loan balance can’t exceed 105% of your home’s value.

-You must be current on your exiting loan as follows: No late payments for the past six months. Max of one late payment for the past 12 months.

-Your new HARP loan must close by December 31, 2013.

-You don’t have to do a HARP refi with your existing lender. Any lender can do it.

-You can only refi first mortgages into new HARP loans. You can’t combine first and second mortgages, but you can subordinate your existing second mortgage behind a new HARP first mortgage—IF the second mortgage holder approves it.

-Your new HARP loan won’t require mortgage insurance unless your existing loan already had mortgage insurance.

-Your new HARP loan amount is subject to current conforming loan limits.

-Your new HARP loan is for owner-occupied properties.

-If you bought your home as owner-occupied, lived in it for at least one year and it’s now a rental, you can qualify for an owner-occupied HARP loan.

-Your current loan cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May 2009.

–EFFECTIVE DATE: Lenders will start implementing these HARP enhancements November 15. Your mortgage advisor can tell you their specific dates, screen you for eligibility, and get your pre-approved while HARP Phase II ramps up. Lenders can and do add their own qualifying parameters to these existing HARP guidelines, so when you’re asking your mortgage advisor to screen you for eligibility and pre-approve you, make sure to ask them to brief you on any additional guidelines they have (often called “overlays”) in addition to core HARP guidelines noted here.
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Further Reference:
–FHFA Fact Sheet & Q&A On HARP Revisions
–MakingHomeAffordable.Gov
–12 Questions On Obama’s Refi Plan
–FHFA Removes Refinancing Barriers

Ted_rood says:

October 25, 2011 at 7:05 pm

Any idea on PMI portability? The lack thereof has hindered many of my clients who would love to refi but have PMI.

Also, can these only be done on loans with less than 20% equity? I have done many under existing guidelines with equity greater than 20%.

Reply
1. The Basis Point says:
  
  October 25, 2011 at 7:45 pm
  
  Yea new LTV min is 80 but no upper LTV cap. As for PMI portability, not sure, I looked at FHFA publications pretty close yesterday and there was no explicit details. I think that’s why it’s going to take until Nov 15 at earliest for lenders to implement because they need to square those kinds of details with their PMI companies.
  
  Reply
2. Reuben Ahmed says:
  
  November 17, 2011 at 10:45 am
  
  I’m just a normal homeowner, but did extensive research and called Fannie mae and my home lender before November 15th to clarify HARP 2 details. They couldn’t answer all of my questions.
  
  But almost everyone pays PMI if your LTV is over 80%.
  
  There is a difference between buyer paid PMI (BPMI) and Lender paid PMI (LPMI). My fannie mae loan is LPMI, the PMI was built into the rate (6.75%). It’s a shame that my credit is over 860 and I pay such a ridiculous fixed rate.
  
  Anyway, because I have LPMI, and I’m probably over 100% LTV, the new PMI must be turned into BPMI – and it’s very high.
  
  For example, my current LPMI is around $120 a month in the rate. The new PMI will be $260 a month. Outrageous. I don’t save much money by refinancing then.
  
  Reply
Sales says:

October 31, 2011 at 12:44 am

more bulshizet from dumbo do you think he is out to help us get ready for the big let down nov 15th vote him out or the country is done…………

Reply
The Basis Point says:

November 17, 2011 at 11:41 pm

Reuben thanks for the note. We haven’t gotten any guidance yet on PMI parameters, and probably won’t for a couple weeks. But curious where your LPMI being converted to BPMI finding came from? You’re right: benefit would be muted. But going from 6.75 to current market still seems like it would still provide benefit even with higher BPMI. Thanks again for sharing.

Reply
Jojcoolmeet says:

March 1, 2012 at 8:45 pm

Noooo Kidding! this program will help again just those institutions, in the way to move money invisibly from consumers to them. This HARP is discriminatory under the guide lines.
For 30yrs, they can refinance beyond 125% LTV wich means if you refinance again you are extending the term and paying more in long term……
For ARM you can only refinance up to 105% LTV, because you are more profitable for those institutions as long you are paying now at low rate and we can catch with you later on.
The gov. has no intention to help any consumers or to keep their houses.

Reply
Jojcoolmeet says:

March 1, 2012 at 8:45 pm

Noooo Kidding! this program will help again just those institutions, in the way to move money invisibly from consumers to them. This HARP is discriminatory under the guide lines.
For 30yrs, they can refinance beyond 125% LTV wich means if you refinance again you are extending the term and paying more in long term……
For ARM you can only refinance up to 105% LTV, because you are more profitable for those institutions as long you are paying now at low rate and we can catch with you later on.
The gov. has no intention to help any consumers or to keep their houses.

Reply
Tim Randle says:

April 12, 2013 at 1:40 pm

Speaking of overlays, do the normal DI ratios, credit scores, etc apply? Know of any similar programs to the one that was helping folks who were 2-3+ months behind?

Reply
Tim Randle says:

April 12, 2013 at 1:40 pm

Speaking of overlays, do the normal DI ratios, credit scores, etc apply? Know of any similar programs to the one that was helping folks who were 2-3+ months behind?

Reply