Homeowners - Getting Started With HARP

This new refinance program is intended to be as easy and streamlined as possible through the entire process. Even second mortgage subordination agreements and Mortgage Insurance contingencies are not posing as major road blocks.

Fannie Mae and Freddie Mac offer loan lookup tools on their websites to help you determine if your loan is owned or guaranteed by one of the companies.

http://www.fanniemae.com/loanlookup/
http://www.freddiemac.com/mymortgage

The Making Home Affordable Refinance Program was opened to all participating mortgage brokers, bankers and lenders on March 19, 2012.

This is significant because it means you have the added benefit of being able to research your options with other mortgage companies, vs being restricted to having to exclusively deal with your current servicer or bank.

• Option A) Contact a Harp Approval HARP Lender mortgage professional at (888) 883-7396
• Option B) CLICK HERE to complete a pre-application online.
• Option C) Ask a quick question on our HARP Frequently Asked Questions page.

There has been a flood of new HARP applications overwhelming underwriters, which will obviously slow the time from pre-approval through funding.

Retail and Wholesale lenders are also adjusting their guidelines on a regular basis as this new underwater refinance program evolves.

The good news is that HARP 2.0 fundings are off to a great start with several thousand close loans recorded in the first quarter of 2012.

In comparison to the FHFA January 2012 Foreclosure Prevention Report that mentions about 100,000 HARP 1.0 refinances, with only 72,000 loans that had a Loan-to-Value greater than 105%, it appears that this new HARP 2.0 program has the potential to positively impact the 4 million underwater homeowners that the Obama Administration is intending to help.

Our advice is to be patient once you have completed the initial application with a HARP approved mortgage company and your full loan package has been submitted for underwriting.

Depending on your unique scenario, Loan-to-Value, credit profile and documentation requirements, it may take several weeks before a final underwritten bank approval is provided.

While you're shopping for the best HARP Rates, keep in mind that most lenders are requiring that a particular file is further along in the process before an interest rate can be locked.

And finally, don't be afraid to Ask Questions if you are unsure about whether or not your refinance is going in the direction that you originally anticipated.

We will continue to update http://harpapproval.com with the most recent news and information about the Home Affordable Refinance Program, so please bookmark this site as you are researching your options.

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Choosing The Right HARP Lender

Simply crossing your fingers and hoping for an approval is not the best strategy for successfully getting your HARP loan through the refinance process.

Submitting a loan application with the first HARP Lender that mentions your potential eligibility may result in a negative experience, especially if you end up waiting several weeks just to receive a notice that your loan was declined due to specific bank guidelines that you were not made aware of at the time of application.

Don't worry, the mortgage professionals at Harp Approval believe in full communication and up-front disclosure about your options.

Taking Control Of Your HARP Loan Process

The Home Affordable Refinance Program's eligibility requirements outlined on the official MakingHomeAffordable.gov site are fairly straightforward, and appear to actually be able to help millions of underwater homeowners as the program has stated.

However, many HARP applicants have expressed their frustrations over the long underwriting turn-times and different bank qualifying criteria.

There are several factors that can determine the ultimate approval of your new refinance, such as Credit Scores, Debt-to-Income (DTI) Ratios, Loan-to-Value (LTV), occupancy types… and so on. To complicate what should be a streamlined program for borrowers, each mortgage banking institution has their own set of lending guidelines or bank overlays that they generally follow without exception.

The good news for underwater homeowners is that there are plenty of HARP Lenders who have an appetite for this new loan program.

If you or someone you know was unsuccessful in getting their mortgage refinanced with one lender, know that HARP 2.0 could still be an option for helping you cut your monthly mortgage payment and/or interest costs.

HARP Lender Checklist:

Obviously, knowing what to be prepared for up-front when shopping multiple HARP Lenders will save you money and releve any additional anxiety.

1. Does your company have any servicing restrictions on who you can originate HARP 2.0 loans for?

Many big banks will do HARP 2.0 loans, but only for loans where the payment is still being made to them. And it is important to realize that bank tellers may not have access to your servicing information at the time that they recommend you check out the new HARP program.

Note - in many cases, even though your loan may have started with the bank where you do business, the servicing may have been sold to another company which could prevent the original lender from refinancing your loan.

Bottom line, there are lenders that will do your loan regardless of who the present servicer is.

Just make sure before you submit your application that you ask if they have any restrictions in the event your loan is serviced by another company.

2. Do you have any Loan-to-Value (LTV) caps in effect that would prevent my loan from being approved?

Some lenders are currently originating HARP 2.0 loans, but only at a maximum LTV of 105%, 125% or 150% limits.

For example, a loan amount of $125,000 with a home value of $100,000 would represent a Loan-to-Value of 125%. If your loan amount exceeded this and your lender had a cap of 125%, your loan would not be approved.

Some lenders have no LTV restrictions and if you believe your new loan would exceed 105%, you would be wise to ask in advance before proceeding if this could be a problem for you.

Note - The higher the LTV, the longer it may take to close your HARP loan due to the limited number of lenders that are funding these higher Loan-to-Value transactions. For mortgages with 150% or greater LTV, it is not uncommon to wait 60-90 days for a full underwritten approval and final loan documents.

3. Do you have any FICO score caps in effect that could prevent my loan from being approved?

Some lenders have instituted FICO score caps for HARP 2.0 loans that may exceed their normal guidelines.

This is particularly true when the loan to value exceeds certain levels. If you know that your FICO score may fall below 720, you should ask the lender you are speaking with if they have any credit overlays involving FICO scores that could impact you.

Note - One of the updated guideline changes with HARP involves placing a ceiling on Loan Level Price Adjustments (LLPA), which would have normally disqualified a borrower from refinancing due to the higher interest rates.

4. If my mortgage has Private Mortgage Insurance in effect, will that be a problem with obtaining an approval?

Some lenders will not originate a new HARP 2.0 loan if your current mortgage has Private Mortgage Insurance (PMI) currently in place. This could be either PMI that you currently pay monthly or is paid by the lender.

Many lenders will work with you if your mortgage has PMI, just make sure you discuss this with your lender before you make application.

5. Do you have any occupancy restrictions if my property is not my primary residence?

If your property is a used as a second home or investment property, some lenders will not work with you, preferring to originate HARP 2.0 loans only for properties that are used for a Primary Residence.

6. Do you have any restrictions on property type that could prevent my loan from being approved?

Property types can be described as detached and attached single family residences, including town homes and condominiums. There are also multi-family properties including duplexes, triplexes and quadruplexes. HARP 2.0 allows for all property types to be refinanced although many lenders have restrictions that do not include all.

7. What are your interest rates?

We have a complete section about how to shop for the best HARP Interest Rates, which will give you more than enough ammunition to have detailed conversations with various lenders for the purpose of getting the best deal.

It is important to keep in mind that shopping for a HARP lender based on interest rate quotes generally results in a negative experience.

Due to the demand for the Home Affordable Refinance Program in , most banks are requiring extended loan lock periods unless a file has been fully underwritten and approved. The longer a rate is locked for prior to funding, the higher the interest tends to be.

So, if a loan originator or bank teller is quoting specific low interest rates before finding out key details about your unique refinance scenario, then it is likely that the mortgage rates they are talking about may not materialize by the time you receive an initial Good Faith Estimate.

If you encounter an obstacle, this doesn't mean that you cannot obtain financing, it may simply mean you have to ask the right questions to find the right lender.

You just might find that HARP 2.0 is exactly the loan program you were looking for to help you out.

Program Overview

According To Fannie Mae's website:

In proposing the new plan, the president acknowledged that efforts initiated in February 2009 hadn't worked as planned:

"The housing plan we launched a couple years ago has helped nearly 1 million responsible homeowners refinance their mortgages and save an average of $300 on their payments every month. I'll be honest -- it didn't work at the scale we'd hoped. Mortgage rates are as low as they've been in half a century, and when that happens, homeowners usually flock to refinance their mortgages. But this time, too many families haven't been able to take advantage of the low rates. Falling prices locked them out of the market."

Home values have declined in many states since the peak in the housing market. According to CoreLogic, over 10.7 million mortgages are underwater.

Underwater mortgages, particularly with higher than average interest rates, have proven to be more likely to default. In an effort to stabilize home prices and decrease foreclosures, HARP 2.0 is designed to help borrowers with negative equity refinance into traditional loans.

Recent changes to the HARP Program removed the maximum percentage amount that a property can have an underwater mortgage. Prior to December 1, 2011, the maximum amount that a property could be underwater was 125% of the loan balance.

This means that if a property is valued at $100,000, the maximum that the mortgage being refinanced would be $125,000 or 125% of $100,000. This would also be referred to as 125% LTV or loan-to-value.

In addition to eliminating the cap on Loan-to-Value, the program has reduced or eliminated many additional fees to refinancing that were previously in effect.