Are You Too Late?

Sep 25

Are you too late for a HARP2 refi?  The FHFA does not think so. See this article! http://www.examiner.com/article/fhfa-launches-new-national-education-campaign-for-underwater-homeowners

Read More

How HARP Mortgages Can Save Lives

Sep 04

The HARP program has been extended until the end of 2015.

With rates and values going up and the HARP eligibility date of before 6/1/09 going farther away each day, do we really need it? Have most of the people that are eligible either done their refinance or can’t?
Has the industry and government been active and diligent in making sure everyone that is eligible knows it?

Yes, there are people that just won’t do it.  For one reason or another, it will never happen.

My answer is that we should expand it to no date for eligibility.  Why?  Because the economy needs the boost.  Every time someone lowers their mortgage payment, they have more money to put into the economy! Also, that means local sales taxes will be collected and local municipalities will not have to raise taxes on everyone to survive.  Also, they may be able to hire that one extra police or fireman to help save lives.

Yes, save lives.  Lowering mortgage payments can save lives.  It sound ridiculous, but I hope you see my logic.

Now, to get Freddie and Fannie to act.  Along with that, we need to get FHA on board too.  Big undertaking, but not impossible.

 

 

Read More

HARP 2 and PMI

Nov 11



The Hidden Trap in HARP Refinancing (via Credit.com)

Here’s why: Refinancing through HARP can significantly extend the length of time you have to carry PMI on your mortgage. PMI can also make it more difficult to refinance through HARP, and limit your choices of lenders — meaning you could end up paying a higher rate than necessary. If you’re in…

Read More

Fannie Mae HARP 2 Updates…Some Good News!

Oct 26

From Rob Chrisman’s blog:

Effective October 13th, Fannie updated eligibility requirements such that existing loans with investor-paid mortgage insurance sufficient to meet the credit enhancement requirements for loans with LTV ratios over 80% can qualify for DU Refi Plus.  This is provided that the policy can be converted to borrower- or lender-paid coverage; if the insurance can’t be converted, the loan remains ineligible.  Certain loans covered by investor-paid policies with Triad Guaranty Insurance Company will also remain ineligible.  This doesn’t change anything for existing Refi Plus loans whose investor-paid insurance satisfies the credit enhancements for LTVs over 80%, but Fannie encourages servicers to keep an eye out for changes.

As part of the recently announced HARP 2.0 enhancements, Fannie has updated the list of eligible employment, base pay, overtime, bonus, commission, self-employment, alimony, child support, rental, retirement, pension, Social Security, and temporary leave income documentation methods for DU Refi Plus 2 Same Servicer, Other Servicer, and Value Plus loans.  The required documentation for verification of retirement accounts; trust accounts; secured borrowed funds and gifts; stocks, bonds, and mutual funds; and checking, savings, certificate of deposit, and money market accounts has been revised as well.  The enhancements also state that proof of asset liquidation is not necessary even if borrowers must pay closing costs and that borrowers who are being removed through refinance transactions are no longer required to be removed from the property deed or title.

Yes, this needs to be translated into English, but it may mean that more people will be eligible for more HARPs!

Read More

No Doc, Here We Go Again!

Sep 21

From Rob Chisman’s blog today:

Many LO’s are pleased about an alternative to documenting income for Refi Plus loans where payment increases will be under 20 percent.

Rather than requiring that at least one of the borrowers has a documented source of income, Fannie Mae will now accept verification of liquid financial reserves equal to at least 12 months of the new mortgage payment (PITIA). Documentation can be through one or more recent statement of liquid reserves in bank accounts, money markets, stock accounts, retirement savings accounts, or certificates of deposit.

Fannie Mae is also providing streamlined documentation requirements for other underwriting criteria for these loans: RockOnDURefiPlus.

Read More

HARP 2 No Income Verification….Sort Of

Sep 17

Fannie Mae announced that if you want, you can prove assets instead of income.

Here is the direct text….you decide!

Updates to Refi Plus™ and DU Refi Plus™
The positive impact of Refi Plus and DU Refi Plus continues, enabling borrowers who have demonstrated an
acceptable payment history on their existing Fannie Mae mortgage loan to refinance and obtain a lower
payment or move to a more stable product or shorter term. To help lenders more efficiently reach an even
broader base of eligible borrowers, Fannie Mae is announcing a number of enhancements to the underwriting
and documentation policies for Refi Plus (manual only) and DU Refi Plus mortgage loans including:
 Reducing representations and warranties
 Providing an alternative to income verification for Refi Plus loans with payment changes less than
or equal to 20%
 Reducing documentation for income and assets
 Providing an alternative qualification method when removing a borrower
 Clarifying use of Hardest Hit Fund
®
programs
 Removing requirement for Single-Family Comparable Rental Schedule (Form 1007) for investment
properties
Effective Date
Unless otherwise noted, these policy updates are effective immediately. The Selling Guide will be updated at a
later date to incorporate these changes.
Reducing Representations and Warranties
Selling Representations and Warranties
Earlier this week, Fannie Mae announced that lenders will be relieved of their obligation to remedy Refi Plus
and DU Refi Plus mortgage loans that are in breach of certain underwriting and eligibility representations and
warranties if the borrower was not 30 days delinquent during the 12 months following the acquisition date of
the mortgage loan. This new policy will apply to Refi Plus and DU Refi Plus mortgage loans acquired on or
after January 1, 2013. Refer to  Announcement SEL-2012-08,  New Lender Selling Representations and
Warranties Framework for complete details.
Property Representations and Warranties
Fannie Mae will now  grant additional representation and warranty relief for Refi Plus and DU Refi Plus
mortgage loans with regard to the subject property.
For Refi Plus and DU Refi Plus mortgage loans where a new appraisal is obtained, the lender is not required to
make any representation or warranty as to the value, marketability, or condition of the subject property.

Read More

HARP 2.14159265359 PLUS ONE

Sep 10

According to Diana Olick on CNBC, the Senate is re-looking at a bill that would help more homeowners that are stuck in HARP2 like loans.

Even if your loan is not with Fannie or Freddie, you may be able to refinance into a better (near 4%) loan through a government sponsored but publically MBS funded program.  Ready my words from my fingers and my brain- NO NEW TAXES.

This will work for the millions that need help, help keep more people in their homes, see less foreclosures, increase vales, stimulate the economy because of lower payments and will increase jobs and consumer spending.

DUH!

I can’t wait for the naysayers to try and put a stick in this on.

 

As long it is properly administered, the FHFA does not come up whit a curve ball, the program has the full openness to all mortgage originators across the board to keep the prices fair and has no stupid underlying underwriting guidelines (a la Freddie Mac and their ridiculous revolving credit issue), this should fly through and give people a break, get the banks off the hook, spur the economy and make every a winner.

Read More

From the BFD File….Olympic Mortgages

Jul 31

Freddie Mac said today that it would be opening up refinance opportunities to borrowers who are not underwater on their existing Freddie Mac mortgages. Under the company’s Relief Refinance Mortgage Program which includes the Home Affordable Refinance Program (HARP 2.0) the requirements for refinancing mortgages with loan-to-value ratios at or under 80 percent will be brought in line with those with LTVs over 80 percent, the target audience for HARP 2.0 loans.

Big F’deal Deal.

How about helping the people with the HIGHER loan to values that need the help and can help save the economy!

The mandate for this program squarely was for the agencies to help alleviate the burden of high mortgage payments for those that have steadfastly remained loyal to their homes.

Instead, they are forcing people to go into foreclosure and therefore lower home values more.  The National Association of REALTORS should be furious at this, but to my knowledge, there has not been any further pushing of the agencies and Mr. DeMarco of the FHFA to push for higher LTV refinances and realistic guidelines.

Instead, the idea of burdensome little details that don’t mean anything just keep annoying the people that deserve the help.

It’s not a government handout, it’s not a principal write down, it’s not a back door, sneaky was of reducing your monthly payment.  It was a sensible solution to a stubborn problem caused by the fraud of others and the greed of the institution of sub-prime mortgages.

Ok, enough ranting.  The point is that you need to carefully see that you qualify for a HARP loan and that the if you don’t but deserve to, contact your Congressperson and the person running against them (since they are all up for election!).  Make a stink.  Hold a neighborhood meeting if they don’t help you.

Yes, you have the power, you just have to take time and use it instead of not getting involved.

Yes, this is more important than which swimmer wins the Olympic medal.  Why do you care how much one of these guys/girls makes in endorsement money afterwards?

Start your own mortgage Olympics!  Hard work and dedication will pay off!

 

UPDATE 8/1/12

This is from an update from Rob Chrisman’s blog about the Freddie relief changes:

Freddie’s announcement boiled down to it opening up refinance opportunities to borrowers who are not underwater on their existing Freddie Mac mortgages. Under the company’s Relief Refinance Mortgage Program which includes the Home Affordable Refinance Program (HARP 2.0) the requirements for refinancing mortgages with loan-to-value ratios at or under 80% will be brought in line with those with LTVs over 80%, the target audience for HARP 2.0 loans. This is much more in line with Fannie’s program, although details won’t be available until mid-September and go into effect in January.

The alignment will involve eliminating many of the representation and warranty requirements that exist on the mortgages being refinanced.  It is hoped this will act as an incentive to lenders to promote the loans.  Freddie Mac said it is further evaluating the Relief Refinance program, specifically looking at the Open Access offering to determine the best way to reach eligible borrowers and assist lenders in managing capacity.  Open Access is designed to promote competition so that borrowers can obtain Relief Refinance Mortgages including HARP 2.0 from lenders other the one associated with their existing servicer. Open Access is the cross-servicer streamline refinancing program within Freddie Mac’s HARP streamline refinancing offering.

Investors are keenly interested in this, as you can imagine. The proposed HARP 2.0 changes by Freddie could boost pre-HARP prepayment speeds. And no one wants to pay 105 for a loan and then have it pay off at 100. The changes will most likely involve some form of easing of cross-servicer reps and warranty requirements, potentially bringing them in line with those for same servicer. The same-servicer Relief Refinance program eliminates most rep and warranties for same servicer refi’s of loans with LTV’s greater than 80%, but originators point out there are three key hurdles to cross servicer HARP refi’s: 1) different rep and warranties from same servicer refi’s, 2) capacity constraints and 3) slightly adverse economics for such refi’s. Whereas the latter two will remain unchanged, making reps and warranties similar should still result in an increase in cross servicer refi’s, impacting investor’s appetites for pools.

In addition, Freddie Mac also announced that it would align requirements for less than 80% LTV loans with those for greater than 80% LTV loans. This would include aligning rep and warranty guidelines, a notable change given that greater-than-80% LTV refi’s currently enjoy significant rep and warranty waivers. Additionally, it is also likely that the LLPA (loan level price adjustment) caps that currently exist for higher LTV loans will be extended to less than 80% LTV loans. But perhaps it is much ado about nothing – Fannie Mae already has uniform rep and warranty waiver guidelines across LTV’s, and analysts have not seen much difference in prepayment speeds between Freddie and Fannie pre-HARP less than 80% LTV loans. Most of the HARP 2.0 refi’s have been in the very high LTV range.

Read More

Almost Paradise

Jul 21

I just received this from a person in our 50th state:

My mortgage on a property in Maui, Hawaii is backed by Fannie Mae. I meet all the requirements for HARP 2 loan and have submitted the application to American Savings Bank, Maui. For a $200,000 loan, my Loan To Value exceeds 125%. The bank officer told me that he used DU (Desktop Underwriting) program and and put a property value of $145,000. He got an \”Error message\” which stated \”EA3 ineligible\” which means No PIW (Property Inspection Waiver). I thought HARP 2 is to help customers like me who are underwater and the Loan To Value can exceed 125%. Then why was my HARP 2 EA3 ineligible?

And my response:

Dear ,

Thanks for contacting me.

The problem is that the agencies (Fannie Mae and Freddie Mac) do allow for unlimited loan to values.

But, the lenders have to not only agree to do the loan, the investors that buy loans have to agree to buy them. These loans are all pooled into something called mortgage backed securities.

The buyers of these have decided that they don’t have an appetite for this product, hence, it’s now hard to do.

But this may not be the end for you.

Instead of going to a bank, find a mortgage broker who can search out the right program.

Best of luck and thanks for venting.

Mahalo,

Fred

 

Read More

HARP and Foreclosure Talk on CNBC

Jul 13

Read More

Why Can’t I Refi?

Jul 12

Hey, Damian, Screw You!

That’s what mortgage giant Freddie Mac and their approved lenders are saying to my client.

All Damian wants to do is lower his rate from 6.75% to somewhere near 4% so that he can help pay for things like food.

Damian has a $330,000 mortgage but his house is worth about $300,000.

He got his loan prior to June 1 of 2009, has a good enough credit score and income to qualify for HARP2, has PMI on on his loan ($220) per month.

Everything is perfect. Except one thing.

Even though President Obama and created this program with Damian in mind, the lenders will not do it even though they will have NO responsibility if the loan goes bad. Why? Why should they?

Industry insiders have confided in me that since the lenders are so busy with “normal” loans and over capacity, why should they take on higher, riskier loans that they may have to buy back if they do something wrong.

Added to the fact that there are cat fights between mortgage insurance companies, lenders and the agencies, the swell of negative takes this to a level of NO!

Diana Olick of CNBC did a great blog post about this. Read it by clicking here.

So, what can we do.

First, call your Congressman. It’s an election year. Make them understand what is really going on and that they need to help fix it.

Two, let the President know that the plan he put in place is not working. If people can refi, there will be more money to spend that the economy will get better sooner.

Third, call the servicer of your loan each and every day, 8 times a day until they (maybe) will do the loan just to get you off their backs. If you are with a bank that is close to you, go there every day and ask to see the manager.

Read More

The Banks Have Their Heads Up Their ……

Jul 02

 

Read More