HARP 2.0 Unlimited LTV Refinance

UPDATE 5-18-2012 We can now refinance CONDOS at any LTV! Got rejected at the bank because your property is a condo?  Apply with Christensen Financial to get your Florida condo HARP 2.0 refinance

Yes…another HARP 2.0 update.  For those of you that have been under a rock for the past few months, there is a new refinance program (see Home Affordable Refinance Program) available to certain underwater homeowners that have made timely payments to their current mortgage holder.  There’s some additional qualifications of course; Find out if you qualify for HARP 2.0

Now, for those of you that have heard about HARP 2.0 and have been having a tough time getting approved…this article is for you!  You’re no doubt a savvy consumer that does their homework before making any major decisions.  You’ve done your research and everywhere on the internet says that the new HARP 2.0 refinance program has NO loan-to-value (LTV) limitations.  Basically, this just means that it doesn’t matter if you are a little upside-down or a lot, you should still qualify regardless.   So, what’s the problem?

Christensen Financial offers unlimited LTV with the new HARP 2.0 refinance program! 

Well, the issue is most of the banks will not refinance you at any LTV; they have set their own limits.  Why? I have no idea since the whole basis of the program is to allow the banks to refinance consumers without accepting as much responsibility for the outcome/possible default of the loan.  Some banks will only go up to 125% LTV, some to 150% and others still won’t go above 105%.  But, nonetheless, they do impose their own limits and it is a major downer when a good borrower is in a bad equity position.  Chances are, if you are like most people, you’re very upside down; there are plenty that owe double what their home is worth, or even more!  We can still help you!

Owe double your home value? Owe triple?  It doesn’t matter how underwater your loan may be, help is only an inquiry away.

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UGIC + HARP 2.0 = not so fast…

For those of you that have already found out the hard way, borrowers with United Guaranty (UGIC) private mortgage insurance are getting the short end of the stick.  While all of their friends and co-workers are flaunting their new, low, sophisticated rates, UGIC club members are stuck in their existing high interest loans.  At least for now.

This only pertains to those of you that A) have mortgage insurance on your loan currently and B) have that mortgage insurance policy specifically with UGIC.

Apply for a new HARP 2.0 Refinance today to find out if YOU have mortgage insurance

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UGIC is stating both on their website and in some articles found online that they fully support HARP, but our experience is teaching us differently.  None of our current lenders will allow a refinance into the new HARP 2.0 mortgage with UGIC as the private mortgage insurance (PMI) provider.  UGIC has not agreed with the ‘waiver’ basically alleviating the banks from having to buy back bad or fraudulent loans.  While it seems all other PMI companies have jumped on board, UGIC is taking a more conservative approach.

We will continue to keep you updated as we are truly hoping this is only a temporary situation and that they will eventually come full circle.

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Before you HARP, you must read this!

Well, we are back with yet another update on the HARP 2 refinance program.  If you are considering applying for this refinance program, keep reading!  You may be denied if you fail to follow these simple steps.

For those of you not yet in the know, the HARP 2 (Home Affordable Refinance Program, version 2) is a refinance program specifically for homeowners that are upside-down on their home but have continued to make their payments on time.

For more information on the HARP 2 Florida Refinance Program and to see if YOU qualify, click here

So, what is this unknown factor causing these seemingly good loan applicaitons to be denied?!

LENDER PAID MORTGAGE INSURANCE

When a homebuyer puts less than 20% down upon purchase, their loan will most likely have PMI (Private Mortgage Insurance).  This insurance protects the bank against you defaulting on the mortgage loan.  Many people are reading up to this point and saying, “Yeah, I know all about PMI.”  Here’s something you may NOT know.

There are two types of PMI: Borrower Paid (where a separate portion of your monthly mortgage payment is specifically allocated toward the insurance premium on a monthly basis) OR Lender Paid (where the Lender actually pays the whole policy up front for you and then charges you a higher interest rate on the loan to make up for it).

The problem is that many people don’t know that they even have LPMI (Lender Paid Mortgage Insurance) because it doesn’t reflect on their online accounts or mortgage statements.

If you can’t see it on your statement, how do you know if you have LPMI?

Here are a few ways you could find out if you have LPMI and save yourself a whole lot of hassle down the road:

• Ask your current mortgage holder – they should be able to look it up for you
• Find your loan paperwork from when you got the original mortgage – it will be notated on there
• Remember your purchase or refinance – If you put down less than 20% or refinanced with less than 20% equity left in the property at the time, you probably have mortgage insurance.

So Why Does This Matter?

Banks cannot refinance most borrowers with LPMI because it is not easily transferred over.  With borrower paid PMI, the new mortgage company could transfer the policy and just continue the same coverage and monthly amount.  With LMPI there is no solid way to transfer it or make the adjustments because it was paid in full by the lender at closing origianally.

The bottom line: Check if you have LPMI using the above methods, before you apply with any mortgage company.

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HARP 2.0: Banks Flooded With Applications

MAY 15, 2012 UPDATE We have been getting approvals in as soon as 3 weeks, which is a very good sign of things to come.  Hang in there, we’ll make sure you’re taken care of!

When the new upside down refinance program (affectionately referred to as HARP 2.0) hit the streets about a month ago, it brought the mortgage industry to a complete halt.  See, our good friends Fannie and Freddie, whom own a majority of the loans on the market right now,  didn’t release all of the updated guidelines until the last minute.  Since banks have to wait on these guidelines to create their own, everything was a mystery on the program ‘opening day’.  This, combined with the huge number of applications being received, has lead to a major slowdown in the processing and underwriting of these new refinance loans.

This great mortgage refinance program, for those of you not yet in the know, allows homeowners with a Fannie Mae or Freddie Mac owned mortgage (originated prior to May 2009) to refinance into today’s lower rates regardless of how upside-down you are!  How do you know if your loan is owned by Fannie or Freddie?  How can you find out if YOU qualify? Click HERE to see if you qualify today!

How long is it taking to close on one of these new Florida refinance loans?  Some banks are quoting upwards of 120-180 days, 4 to 6 months!  Luckily, we are looking at more of a 60-day turnaround time here which is still entirely too long in my opinion (at least compared to our lightning fast purchase closings).  So, please prepare yourself for the long turn times and realize how lucky we all are that such a unique and beneficial program even exists.  It truly is ‘worth the wait’.  I, for one, am ecstatic that they finally release a loan program designed to reward those that continued to make their payments on their underwater homes.  Now that you know what you’ll be facing when refinancing let us help you with a few tips to expedite the processing and underwriting of your loan:

• BE ORGANIZED!  Sending in the wrong documents or sending everything in one by one can cause huge delays in your processing times.  The easier you make it for the bank to sort through your documents, the faster they will respond.
• BE PREPARED!  Most banks will be looking for W2s, pay stubs, tax returns, mortgage statements, insurance docs, bank statements and a copy of your current mortgage note.  Gather these things up front and save the hassle of running around when asked for them.
• BE INFORMED!  Know how the program works and understand that this is a two step approval process.  The file first has to be approved through the automated underwriting system (AUS) and then manually reviewed by an underwriter.  Find out from your mortgage professional if and when they will run your application through the system initially.  This will tell you if you will most likely be approved or not and help you uncover some areas that would need improvement before submitting to the bank.
• BE PATIENT!  Choose a mortgage professional you trust and allow them to do their job effectively.  Everyone is subject to the long wait times due to the popularity of the program.  It, in no way, shape or form, is a reflection of the quality of your application.

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The Truth About HARP 2

It’s been a few weeks since Obama’s new Home Affordable Refinance Program took effect and we’d like to take a look at some of the experiences we’ve had and lessons we are still learning about HARP 2.0 .  Investment properties are harder to approve, mortgage insurance is a pain to deal with and banks are ripping off their own customers (what a surprise!).

Investment Properties

Real estate investors countrywide rejoiced when they heard about the new HARP 2.0 refinance loan that would allow even investment properties that are upside-down to be refinanced at today’s lower interest rates.

We alerted our clients to the release of the new program and began collecting applications at a rapid pace.  Yes, the guidelines say you can refinance an investment property.  Yes, the guidelines say that it doesn’t matter how upside-down the property really is.  BUT, the guidelines also say that you need to obtain an approval through the Automated Underwriting System in order to qualify for the program.

An Automated Underwriting System (or AUS as it is commonly referred to as) is basically a computer program that takes your loan application information and matches up to the guidelines for Fannie Mae and Freddie Mac loans (of which your current loan must be in order to qualify).  The AUS then reports its ‘findings’ and tells you a) If the loan is approved and can be resold to Fannie/Freddie, and b) What documents and steps will need to taken in order to close the loan.

What is happening now is that we are running our investment property clients through the AUS and the system will not give an approval.  Without an approval, the loan cannot be resold and therefor cannot be approved and closed.  It seems that a high amount of reserves (liquid assets) will help your chances as well as if your property is not TOO much underwater.  There is no cut and dry point here, you really just have to apply and hope to get approved.  It shouldn’t cost you a dime to find out, so may as give it a shot.

Find out not if your investment property qualifies for the new HARP 2.0 program

Mortgage Insurance

If your loan has mortgage insurance, your refinance may be in for a bumpy road.  Mortgage insurance is a bank’s way of insuring your loan against default/non-payment.   That is why it is only required if there is less than 20% equity in the property or you are putting down at least 20% on the down payment of a home purchase; because those are considered higher risk loans for default.

With the new program, the mortgage insurance companies are ‘transferring’ their existing policies over to the new mortgage insurance (MI) company that works with the new lender on a refinance.  Sure this sounds nice and easy, but the issue we are running into is that not all MI companies will do the transfer or participate in the program and even if they do, they new bank may not accept it.

The transfer of MI adds an entirely new dynamic to the refinance process.  The lesson to be learned here is that if you have MI currently and want to refinance your upside-down mortgage, be patient and choose a broker/banker that knows what he/she is doing.  Choosing the wrong mortgage professional could be the difference between an approval and saving hundreds a month OR a denial and being stuck in a bad situation.  Do your research and choose wisely.

Find out if your loan with MI will qualify for the new HARP 2.0 program!

NEW UPDATE MAY 14, 2012 Issues with UGIC PMI

Don’t Trust that Bank!

Here’s a surprise: your current mortgage holder may not have your best interests at heart.  We’ve been getting more and more clients calling us telling us that their current mortgage company quoted them a rate in the high 4′s or 5′s.  In some cases they are even telling clients that they can’t refinance elsewhere to try to get them to agree.  Don’t be a fool!  Bank’s are using this program to generate even more revenue for their coffers and are relying on you, the consumer, to not do any research and take whatever they give you.

You have options! With HARP 2.0 you can refinance with any lender you choose, you are not stuck with your current bank.

Find out what low rates you could qualify for with this new HARP 2.0 program!

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Florida FHA Changes Ahead!

This is the final week to get your FHA mortgage applications in under the current guidelines.  Starting next week (April 1st officially) Florida FHA mortgage loans will cost more money.  How?  Well, the Federal Housing Administration decided to raise the up-front mortgage insurance premium (MIP) as well as the monthly mortgage insurance amount.  FHA loans will cost an extra .75 % ($1500 on a $200k loan) in the form of the increased MIP as well as a .1% increase in monthly MIP (an extra $16.67 per month on a $200k loan).

The exact changes taking effect are:

• 10 basis point increase in annual premium for single family forward mortgages(increased from 1.15% to 1.25% annual premium)
• 25 basis point additional increase for loans above $625,500  (increased from 1.25% to a1.5% annual premium)
• Increase the upfront premium on new originations by 75 basis points (significant increase from 1% to 1.75%)

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ABOUT THE HARP 2.0 UPSIDE DOWN REFINANCE 

It’s no big shocker that many homes in Florida have drastically declined in value over the past few years  - some areas more than others, of course.  The reduced home values create a scenario in which hardworking, loyal homeowners are stuck in properties that are worth less than what they owe the bank (also referred to as being “upside down” or “underwater”).  Up until now, there was no real, viable solution to the epidemic sweeping across the State of Florida.

Introducing the  HARP 2.0 Refinance Program - Sure, it sounds more like a character out of Star Wars, but HARP actually stands for Home Affordable Refinance Program and the 2.0 stands for this being the second version.  Up until now, in the current HARP program, borrowers were limited to maximum LTV’s (loan-to-value ratios AKA how much you owe vs. how much it’s worth) of 125% or sometimes as low as 105%…not much help.

But, with this new HARP 2.0 mortgage, Florida homeowners can get the help they really need.  Even if you owe twice as much as what your home is worth,HARP 2.0 can help!   And with Florida interest rates at or near all-time lows, your time to lock in mortgage savings is right now!

Curious on how much you’ll save?  Calculate your new payments right here!

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What’s new with the HARP 2.0 Program?

Changes to the previous HARP refinance guidelines:

• Your current mortgage must be owned by Freddie Mac or Fannie Mae

• The loan-to-value cap is now lifted for mortgages with terms up to 40 years for all banks; it doesn’t matter how much you owe you, YOU can qualify for the HARP refinance program.
• Certain fees will be waived for homeowners who refinance into a shorter-term loan.
• A property appraisal may not be necessary as long as there is enough information to estimate your home value.
• Any mortgage company can now process your HARP refinance. You are NOT required to use your current Florida mortgage company.

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Florida FHA Refinance | FHA Streamline Refinance

What are the new FHA changes?

In a nutshell, FHA refinance loans just got a whole lot cheaper thanks to the White House deciding today that it was going to cut mortgage insurance premiums on all streamlined FHA refinances for loans taken out before June 1, 2009.  What does this mean?

If you or anyone you know has an FHA loan that was originated before June 1, 2009, they should visit PurchaseFlorida.com or another reputable Florida mortgage lender and apply online to see if they’re eligible.

The streamline refinance program allows FHA borrowers to obtain new FHA-backed loans without going through some of the more stringent guidelines that make loan approvals more difficult.

FHA will lower the costs on up-front mortgage insurance premiums to 0.01 percent for streamlined refinancings of FHA loans.

FHA will also cut the annual fee down to .55 percent, down a significant amount from the typical 1 percent plus that is currently charged.

How can I see if I am eligible?

Fill in the information below to see if you are eligible:

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Please remember, you are only eligible for the streamline refinance program if you originally took out your FHA loan prior to June 1, 2009.

THIS IS HUGE!  A great move towards making a real difference in the housing industry.  There are so many homeowners that were unable to refinance their FHA loans due to the increased insurance premiums and now they can get the help they so desperately need.

If you or anyone you know has an FHA loan and could benefit from an FHA refinance, please forward them this article.  I can’t recall the last time any of my friends saved my thousands of dollars, I’m sure they’ll appreciate it!

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April Fools?! FHA MIP (Mortgage Insurance) Increase Alert

Please read below and act immediately to lock in your low, fixed FHA mortgage

Florida home buyers, this is your warning!  There is an immediate change coming to the market.  The FHA Mortgage Insurance Premium (MIP) will increase for all mortgage applications completed after April 1, 2012.   This FHA MIP increase will affect BOTH the monthly premium amount as well as the annual premium.

What does this mean?  Simply put, your Florida FHA loan will cost more on a monthly and up-front basis if you wait until after April 1, 2012 to apply for an FHA mortgage.  Lock in your low FHA mortgage by applying online with an Orlando Mortgage Broker:

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How much will it increase?  The April 1, 2012 FHA MIP monthly and annual increases are as follows:

• 10 basis point increase in annual premium for single family forward mortgages (increased from 1.15% to 1.25% annual premium)
• 25 basis point additional increase for loans above $625,500  (increased from 1.25% to a 1.5% annual premium)
• Increase the upfront premium on new originations by 75 basis points (significant increase from 1% to 1.75%)

Upcoming FHA Policy Changes

Revised Seller Concession Policy

Last Thursday, HUD published a request for comments (due in 30 days, by March 26) on their revised changes to FHA policies on seller concessions. Some of you may recall that HUD had initially proposed the reduction of seller concessions from the current 6% to 3% bak on July 15, 2010. The new proposal is as follows:

• Reduction of seller concessions to 3% OR $6,000, whichever is greater.
• Acceptable closing costs allowed to be paid by seller concessions: closing costs, prepaid items, discount points, up-front MIP, and any interest rate buy down
• Changes the definition of “interested third party” by adding lender, mortgage broker and settlement company to the list.

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Florida FHA

With the resurgence of FHA home loans in Florida, many home owners and future home buyers are wondering if they can benefit from an FHA loan. When buying a Florida home, FHA offers a great loan option for borrowers looking for a low down payment requirement and a low fixed interest rate.On refinances, the truth is that you may or may not benefit by converting your existing loan into an FHA loan when you refinance.

Some of the factors that can determine if an FHA loan is right for you:

• Loan To Value
• Home Value
• Size of Existing Loan
• Credit Score
• Amount of Cash You Want to Take Out

With the many changes that have occurred with FHA loans, it is possible that even if you didn’t qualify six months ago, there may be a loan program that is right for you.

One of our mortgage professionals can help you determine if a Florida FHA loan is right for you and your family.  Whether you are purchasing a new Florida home or refinancing an existing one, we have you covered!

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