We are now 48 hours into the new release of HARP 2.0, the government's latest effort at helping people refinance who are upside down in their mortgage. But the devil is in the details!
Here is what is coming true. If you have a mortgage owned by either Fannie Mae or Freddie Mac, you may be able to refinance with no regard to loan-to-value (meaning you could be a loan-to-value of 150% or more) and lower your existing rate.
With Fannie and Freddie owning an estimated 56% of the mortgages out there, there is opportunity. But your mortgage must have been purchased by them before June 1, 2009 in order to qualify. You must also be current on your mortgage and have a good payment history. Although I've heard of lender claims such as no credit score and appraisal required, this would be in the perfect scenario. For example, I have clients who are upside down on their mortgage. Their loan is owned by Freddie Mac. When we initially wanted to a refinance in January of this year, it didn't work. Value on the appraisal was too low. Now we may be able to do the loan but our automated underwriting system is requiring another appraisal.
In other words, there will probably be individual lender overlays in addition to what you may be hearing out there. Another example. I have two clients who are upside down with lender paid mortgage insurance. I'm still looking for viable options that can help these people out. Update: I just got off the phone with a lender we use who may be able to help. I will keep you posted as things progress. Let me know if you have any questions about HARP 2.0. And thanks for reading!
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