Government Refinance Assistance

President Obama outlines more details of his new mortgage plan

G.R.A. Admin — Wed, 01 Feb 2012 18:22:12 +0000

In an address in Fall Church, VA this morning President Obama fleshed out some of his new plan to help more Americans take advantage of the record low rates we are currently experiencing. The plan reportedly will lean heavily on the FHA and is designed to reduce barriers for folks who are not able to take advantage of the government-backed refinance programs already in place.

The major kink in the new plan is that the Republican controlled congress must approve it and the $5-10 billion price tag that comes along with it. Odds of that happening don’t seem high.

Even so, there are several very useful government-backed refinance programs that are already up and running well, including the FHA streamline program, the HARP program, and the VA IRRRL program. Contact us in the the sidebar to learn which programs might assist your family.

President Obama announces plans for new government refinance assistance program

G.R.A. Admin — Wed, 25 Jan 2012 04:55:30 +0000

In his State of the Union address this evening President Obama announced plans for a new refinance program that is reportedly going to be targeted to borrowers who are having trouble taking advantage of the government-backed refinance programs already in place. We get the following from a WSJ article on the subject:

President Barack Obama called on Congress during Tuesday’s State of the Union address to approve new legislation that would give all homeowners who are current on their mortgages the opportunity to refinance at record low mortgage rates, officials said Tuesday.

Administration officials declined on Tuesday to outline the mechanics or costs of the program, and they said those details would be spelled out in the legislation in the coming days. “Responsible homeowners shouldn’t have to sit and wait for the housing market to hit bottom to get some relief,” Mr. Obama said. ” No more red tape. No more runaround from the banks.” …

Unlike the existing program, which was unveiled in 2009, the latest proposal wouldn’t limit such opportunities to borrowers whose loans are already backed by mortgage giants Fannie Mae and Freddie Mac, which guarantee about half of all outstanding loans.

While details on the new program are forthcoming, there are several very useful refinance programs already in place. Contact us in the sidebar to learn more about the available programs.

Mortgage interest rates plumbing new lows

G.R.A. Admin — Mon, 23 Jan 2012 16:57:26 +0000

As we begin 2012 interest rates on mortgages are testing new lows. Borrowers with excellent credit and plenty of equity are seeing 30 year fixed rates below 4%. Rates are not quite that low in cases where credit is less than excellent or when there is little or no equity in the home but even in those cases the rates are astonishingly low right now.

Contact us in the sidebar to learn more about the government-backed refinance programs that are available and to get an estimate.

HARP 2.0 guidelines

G.R.A. Admin — Sun, 22 Jan 2012 16:21:41 +0000

Here are the links to the recently released HARP 2.0 guidelines.

https://www.efanniemae.com/sf/guides/ssg/annltrs/pdf/2011/sel1112.pdf
http://www.freddiemac.com/sell/guide/bulletins/pdf/bll1122.pdf

In short, here are the changes these guidelines describe:

- Starting December 1, 2011 authorized lenders were able to begin the loan application process for borrowers who have Fannie/Freddie mortgages with a current loan to value greater than 125%. HOWEVER those HARP 2.0 loans cannot be approved until March 2012 at the soonest because the Fannie/Freddie approval software will not be updated until then. So the soonest a HARP 2.0 loan with an LTV of more than 125% could actually close is probably April of 2012.

- For Freddie Mac loans, if the first mortgage is less than 80% of the value the home the first and second mortgage combined cannot be more than 105% of the current value of the home. (There will probably be price breaks for these loans though).

- There is apparently no change to the eligibility dates so people who got their current Fannie/Freddie loan after May of 2009 appear to not be eligible for HARP 2.0 still.

- There is no mention of changes to the mortgage insurance rules. The official guidelines of HARP 1.0 allowed for MI to transfer already but we do not know of any authorized lenders or MI companies that allowed that. We will have to wait and see if there is more incentive for lenders and MI companies to allow it with the new program.

The other questions yet to be answered over the coming months are:

1. How many authorized lenders will participate in the HARP 2.0 program? There are no requirements for lenders to participate.
2. What will the pricing be for these high LTV HARP 2.0 loan? (Probably significantly worse than loans with lower LTV’s)

So while these guidelines shed some light on the new program there are a lot of questions still to be answered. Stay tuned.

Mortgage interest rates remain near record lows as 2012 begins

G.R.A. Admin — Tue, 03 Jan 2012 18:08:37 +0000

While interest rates on mortgages have been relatively low ever since the federal government began compressing rates in 2009, mortgage interest rates have been especially low since about August of 2011. The recent dip in rates was due to both global economic factors and actions from the Fed. As we enter 2012 mortgage interest rates remain near all time lows. When you combine the especially low rates with the government-backed refinance programs like the FHA and VA streamline programs and the new HARP 2.0 program that will become operational in the next few months, now is a terrific time to look into a government backed refinance.

Contact us in the sidebar to learn more about the government-backed refinance programs that might help your family as we launch into a new year.

Fannie Mae removes debt-to-income requirements for HARP 2.0 loans

G.R.A. Admin — Wed, 21 Dec 2011 21:20:38 +0000

Fannie Mae reportedly has removed its “ability to pay” requirements from the HARP 2.0 guidelines. That means that families that have suffered from reduced income over the last few years might be able to qualify for the HARP 2.0 program. The program will still require no recent 30 day late payments on mortgages but the income qualifying requirement that tripped up so many people may be going away. This change is especially good news for borrowers who are self employed and have had trouble proving income in recent years. Here is an excerpt from a recent HousingWire article on the subject:

Lenders are no longer required to determine a borrower’s ability to repay a loan when underwriting mortgages for inclusion in Fannie Mae’s HARP 2.0 refinancing channel.

Barclays Capital made that conclusion in its securitized products research report Wednesday.

Barclays said Fannie Mae is adjusting its seller guidelines for HARP 2.0 after discovering the “borrower ability to pay clause” is preventing a large chunk of underwater mortgages from entering the program.

Under the changes, the ability-to-pay clause is no longer considered an underwriting requirement for Fannie’s HARP 2.0 program. Instead, Fannie Mae now stipulates that no debt-to-income calculation is required for these refinancings as long as the borrower’s payment does not increase by more than 20%, according to Barclays Capital.

While the HARP 2.0 program won’t be fully operational for a month or two please contact us in the sidebar now to see if you can qualify for it or another government-backed refinance program.

On starting the refinance process in December

G.R.A. Admin — Tue, 13 Dec 2011 17:51:24 +0000

With interest rates near record lows and new government-backed refinance programs being announced many Americans have considered looking in to a refinance. If you are among those people thinking about looking into a refinance, getting started in December has some practical advantages. The most important of these advantages is quite simple: shorter lines. Because of all the distractions from the holidays fewer refinances tend to be originated in December. The result is that the wait times for things like processing and underwriting tend to be much shorter. Starting the refinance process in December and closing the new loan in January is a great way to save time and get extra attention during your refinance process.

Contact us in the sidebar today to learn more about available programs, get an estimate, and possibly get the ball rolling for a January refinance.

Mortgage interest rates continue to hover near record lows

G.R.A. Admin — Thu, 08 Dec 2011 21:49:32 +0000

The wave of bad economic news from Europe has served to help keep mortgage interest rates near record lows here in the US. As worldwide investors seek safe havens for their money the yield on the 10 year treasury note has remained low which in turn is keeping mortgage interest rates stunningly low by historic standards.

HARP 2.0 applications to officially begin December 1st

G.R.A. Admin — Tue, 29 Nov 2011 19:37:00 +0000

Beginning on Thursday December 1, 2011 applications for the HARP 2.0 program can technically be started. We say “technically” because as of now no authorized lender has implemented the program.

As we have discussed in the past, the HARP 2.0 program only applies to loans that are currently backed (invested in) by Fannie Mae or Freddie Mac. In addition the Fannie/Freddie loan must have been funded prior to May of 2009 to qualify for the HARP program. For the millions of loans that meet those requirements the HARP 2.0 programs is designed to allow homeowners to refinance to a lower rate without having to add private mortgage insurance (PMI) even when the loan is more that 80% of the current value of the home. The HARP 1.0 program allowed borrowers to refinance up to 125% of the current value of the home but the HARP 2.0 will do away with that 125% limit. In addition the HARP 2.0 will reportedly be available to borrowers who are currently paying PMI on their Fannie/Freddie loan.

Fannie and Freddie have announced that they will not have their underwriting software updated until March of 2012. As a result the bulk of the HARP 2.0 loans will not be able to be closed until then. What remains to be seen is if some lenders will be willing to manually underwrite HARP 2.0 loans before then. We will monitor the situation and report on any announcements regarding that here.

In the meantime we recommend you fill in the contact form in the sidebar to see which government-backed refinance programs apply to your situation.

Higher FHA loan limits reinstated

G.R.A. Admin — Sun, 20 Nov 2011 00:26:37 +0000

In 2008 the loan limits on FHA mortgages were increased to allow more borrowers across the country qualify for FHA loans. On October 1st of this year those loan limit increases expired and reverted back to their original levels. After several weeks of debates in congress a bill reinstating those higher loan limits through the end of 2013 was passed and that bill was signed into law by President Obama on Friday. While this change will not affect a huge number of people, it will open up FHA loans to more Americans. To learn what the loan limits are in your county see this web site. (Note: it might take a few days for the new limits to be updated there.)

If you have an FHA loan now or would like to learn more about refinancing into an FHA loan contact us in the sidebar.