As we have chronicled in recent weeks, HARP 2.0 is now fully here and homeowners are now closing loans through this new government refinance program. Please read previous articles at: http://activerain.com/blogs/strategicmortgage for complete coverage of HARP 2.0. However, the basic breakdown of the program is that it is a program for homeowners who have Fannie Mae or Freddie Mac owned loans and who are upside down in their homes (regardless of occupancy).
Now that the program is a few weeks old and homeowners have already begun fully closing their loans with this new program, we are beginning to learn more and more about the program. Below is a little bit of that additional information we have found so far.
The program actually does work, unlike many of the previous government initiatives to modify home loans, which have all failed in their own ways. This program is different in that it is a refinance program. While the standards are relaxed, borrowers do still have to qualify for the new loan and so in that way this program is more of a streamlined refinance transaction. Not all borrowers will qualify, but we are seeing that this program actually does work and loans are closing.
Not all properties will receive appraisal waivers. Another interesting item that we are seeing is that not all homeowners who are looking to refinance their homes are receiving appraisal waivers for the refinance of their homes. The majority of the homes that do not receive a waiver of the appraisal are homes that are in outlying areas of the Phoenix metropolitan area. However, we have also seen homes in central areas as well that have not received appraisal waivers. In these instances, you can still get an appraisal however and use the HARP refinance program, even if you are upside down.
Interest rates are generally a little higher than current conventional interest rates, but still very good. While you may not receive a rate below 4% on a 30 year fixed loan, you can still expect interest rates in the low 4’s for HARP refinance loans of primary and secondary homes and in the high 4’s for investment properties. Historically, these are still very low interest rates and will save many homeowners a tremendous amount of money both monthly and over the life of the loan.
Thus, after a few weeks, it is safe to say that the HARP 2.0 program is perhaps one of the most effective measures to help homeowners in recent years. While it will not help all homeowners, for some, it may be the answer to lowering your interest rate and payment enough to keep a home for the long term. As we continue to learn more about the HARP program we will continue to provide additional updates and information.
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: info@strategicmtgaz.com or online at www.strategicmtgaz.com
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