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.
December 1st, 2011 at 7:15 pm
Why does HARP 2.0 not apply to 2nd mortgages on a home that is underwater?
If a unit appraised at $465K prior to the housing bubble now valued at <$200K, with a combined outstanding mortgage of $334K, why can't a mtge company under HARP blend the two rates on the $334K at a reasonable rate and restructure the two loans into one. Under this formula the financier does not lose anything, in fact they gain. Help us understand the "illogic", aside from the willingness to ignore those who continue to pay on what they now deem as undervalued property?