As announced earlier this year, the Fannie Mae HARP refinance program has now been expanded to allow more homeowners the option to refinance and take advantage of historically low interest rates. The big recent news from the expansion is an expansion to help borrowers who are even more upside down in their homes refinance.
As mentioned previously, the program does have a few levels of criteria that homeowners must meet in order to qualify. First, it doesn’t matter who the homeowner currently make their payments to, but the loan must be owned by Fannie Mae. In order to check and see if your home loan is currently owned by Fannie Mae you can quickly go to: http://www.fanniemae.com/loanlookup/ and input your address for immediate results.
Next, the loan must have been originated prior to June 1, 2009. The reasoning behind this is that in the past two plus year’s interest rates and have values have both dropped and so the program is aimed at homeowners who already have Fannie Mae loans, but haven’t been able to refinance to current market interest rates.
Finally, the existing mortgage loan must not have mortgage insurance included with it. Or in other words, when the homeowner obtained the current loan, they took out a Fannie Mae loan that did not have any mortgage insurance monthly payment included with it. You can however have a second mortgage behind this Fannie Mae loan and still qualify for this program.
If you meet those qualifications, then starting December 1, 2011, the program will allow you to refinance your home loan up to 125% of the value of your current home value, at current market interest rates. This is an expansion over the previous limitation of 105% of your home’s current market value.
Furthermore, when it comes to a valuation for your home currently, Fannie Mae will use an automated valuation of your home to establish a value. Meaning that most borrowers will not need to have an appraisal done. However, there also is an ability to complete a standard home appraisal if the automated value does not come in at an acceptable range.
While this program is not going to be an option for everyone, for those homeowners who think they may fit the qualification terms for the program, this is a great opportunity to lock in your home loan rate at incredibly low interest rates.
For full qualification, of course it is always advisable to contact a licensed mortgage lender, such as Strategic Mortgage. As always, as guidelines and standards change we will provide additional information and updates.
For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682 or by emailing: firstname.lastname@example.org or online at www.strategicmtgaz.com