by Ray from Visalia, John in Pasadena, Howard in Canal Fulton, Anne in...
Ask Kate for relevant HARP 2.0 refinance solutions for homes without equity: Meet 6 homeowners with insightful questions regarding underwater refinancing alternatives, HARP loan limits, frustrating PMI obstacles, finding reputable home loan professionals who understand the Making Home Affordable Program, and uncooperative 2nd mortgage lenders who won't subordinate to a new HARP loan.
Alternatives to Refinancing with HARP By Ray A. from Visalia, California
I refinanced a few years ago and when I checked into the HARP 2 program I found out that it was a conventional loan.
Is there a underwater refinance program for conventional loans?
I am fixing to retire and want to have my payment lower so we can stay in the home we have had for 20 years. We are current on the payments and never been late. Please advise me on what options I have.
Thanks Kate for your timely response to my last HARP 3 question. Ray A.
(See Ray's comment here
Ask Kate answers: Alternatives to Refinancing with HARP
Hi Ray, First a little shop talk.
1. Conventional loans are mortgages not insured or guaranteed by a government program such as FHA
2. Not all conventional loans are backed by Fannie Mae or Freddie Mac.
3. The HARP program refinances a conventional mortgage (which you have) but only
if it is owned by Fannie Mae or Freddie Mac. And herein lies the rub!
Sad to say, you share the frustration of many underwater homeowners. Your mortgage is not guaranteed or owned by Fannie or Freddie, a choice never given to you. Regardless, your financing choices today are next to nil.
The policy requiring a mortgage to be backed by Fannie Mae or Freddie Mac for participation in the Making Home Affordable Refinance Program must change. See Responsible Homeowner Refinancing Act of 2013
which reviews my beef with the current proposal of HARP 3.
Here's one alternative. Because this plan does not require Fannie or Freddie backing, look into the HAMP loan modification program
Don't be put off by the fact that Making Home Affordable states a personal hardship is crucial to eligibility. Call the free HUD counselor phone number that Making Home Affordable provides
to find out how your personal circumstances could still fit into the program.
Best wishes for your retirement plans,
HARP 2.0 Refinance Loan Limits By John from Pasadena, CA
Kate: Love your site by the way! I live in a high cost area (91107). Can I refinance my loan up to the $625,500 limit under HARP 2.0?
Ask Kate answers: HARP 2.0 Refinance Loan Limits
The maximum dollar amount that can be borrowed in a HARP refinance is based on the conforming loan limits of the area in which the home is located.
The 2013 conforming loan limits for zip code 91107 is $625,500. But (don't you wish that word didn't exist), check with a trusted HARP lender to confirm there are no other restrictions on your HARP eligibility, such as the date your current loan was originated.
HARP Refinancing with PMI By Howard from Canal Fulton, Ohio
Kate, I am refinancing under HARP. My original 30 year loan was for $107,350 in December 2001. The appraisal was $117,500 with $69.78 in PMI per month. After 10 years of paying PMI, the cost dropped to $17.98 per month.
The new loan is for $94,100 for 20 years.
So I am required to keep PMI. But everything I read about the HARP loan says PMI should stay the same and the price of PMI should not go up.
So why is my PMI insurer, United Guaranty, charging me .5% in points ($475) to refinance my HARP loan? And why are they raising my PMI rate back to original rate?
This seems contrary to HARP. It seems like there is a lot of grey area in this HARP refinance. Is this legal? Can they charge the .5% and raise my PMI back to higher rate?
If they can do this, then what is the basis for removal of PMI? I would think it should be still based on original appraisal value of $117,500. I am looking forward to hear your response. Thank you
Ask Kate answers: HARP Refinancing with PMI
After a HARP refinance with mortgage insurance, cancellation and termination are based on the the new term, loan-to-value, and unpaid balance.
Secondly, MI companies are given leeway in charging a reasonable fee to facilitate a refinance. As you discovered, the fee can be financed into the loan amount.
Lastly, HARP lenders are told by Fannie Mae that when determining mortgage insurance coverage, they should obtain the same coverage in effect or standard MI coverage.
Ask your lender if the cost of your MI is higher because they switched you to standard coverage and what was the reason for the switch.
Go here for more details on getting rid of mortgage insurance: PMI Cancellation and Termination
Choosing HARP Lender for Refinancing By Anne from New Jersey
Kate, I currently have an interest-only arm at 5.5%, due to reset May 2013. I owe $10-15,000 more on my home than likely it is likely to assess. I've gone through HUD counseling and am a good candidate for the HARP program.
I contacted my lender, Bank of America, and after several attempts, was turned over to a lender that is working with me. However, there are a lot of negative comments about them on the net.
I haven't been able to find this info on the net: How do I find a lender with whom others have been satisfied?
Ask Kate answers: Choosing HARP Lender for Refinancing
I have always maintained the most reliable method of finding dependable lenders is to ask your relatives, friends, neighbors, and co-workers who they went through for their last refinance.
Ask if they'd use the mortgage companies again and most importantly would they send their mother or daughter there for financing. Important! Get the specific names and contact information of the mortgage professionals who processed their transactions.
Go here for more details: How Savvy Shoppers Compare Refinance Fees and Mortgage Lenders
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