Friday, July 21, 2017

HARP 2.0 Frequently Asked Questions

Back to topQ. What is HARP 2.0?

HARP 2.0 is an acronym that stands for Home Affordable Refinance Program, which is an initiative from the Federal Housing Finance Agency (FHFA) designed to assist homeowners in refinancing even if they owe close to or more than what their home is currently worth. Recently, new enhancements to the program were announced, allowing an additional 8.5 million homeowners to take advantage of the product regardless of your current equity position.

Back to topQ. I have a second mortgage. Do I still qualify for HARP 2.0?

YES. The HARP 2.0 program only allows you to refinance your first mortgage and does not permit any cash out or debt consolidation. You will keep your second mortgage or Home Equity Line of Credit HELOC open through a process called subordinating. In addition you cannot use proceeds from the HARP 2.0 refinance to pay off the second mortgage/lien, but if you so desire you may pay it off at any time you wish. The second mortgage terms and conditions remain in place while you reduce the interest rate and/or term on your first mortgage.

Back to topQ. What are the loan terms for the HARP 2.0 program?

Terms of 15, 20, 25 and 30 year fixed rates are available. Depending upon your goals and objectives, some people choose a 30 year fixed rates to lower their monthly payments, while others choose a shorter term to try and pay the loan off sooner.

Back to topQ. My loan is owned by Fannie Mae / Freddie Mac but I do not live in the home. Can I still qualify?

Yes you do. The HARP 2.0 program allows for all occupancy types, including primary residences, second homes, and investment properties to take advantage of the program.

Back to topQ. Will I need to have an appraisal done under the new HARP 2.0 guidelines?

In most cases there is no appraisal required. Harlequin Capital Corp will advise you if an appraisal is required once your loan application is submitted through the automated underwriting system of Fannie Mae/ Freddie Mac.

Back to topQ. What is the minimum credit score to qualify for the HARP 2.0?

There is no minimum credit score to qualify according to Fannie Mae / Freddie Mac. However, some lenders may require a minimum credit score. At Harlequin Capital Corp we use multiple lenders so we can qualify our clients that may have been turned down at another lender at the same time getting all our clients the best possible rate they qualify for. Be advised, you must be current on your mortgage at the time of application and have previously paid your mortgage on time for the last 6 months and have been no more than 30 days late one time in the past 12 months. Our loan officers will help create a strategy so you successfully procure your HARP 2.0 mortgage.

Back to topQ. Do I have to stay with my current lender to refinance with the HARP program?

Absolutely NOT, you can work with ANY lender that is participating in the HARP 2.0 program. Harlequin Capital Corp has successfully completed many HARP 2.0 loans currently owned or serviced by many lenders including BOA, Chase, CitiBank, SunTrust etc.

Back to topQ. Is mortgage insurance (MI) necessary with the new HARP 2.0 program?

If your current mortgage does not have MI then it will not be required on the new loan, even if you owe more than 80% of the value of your home. If your current mortgage does have MI, you will need to have MI on the new loan if you owe more than 80%. The new guidelines under HARP 2.0 allow for much more flexibility with MI.

Back to topQ. What if I had a bankruptcy or foreclosure in the past 7 years?

The new guidelines under HARP 2.0 allow for more relaxed criteria for borrowers with previous bankruptcies. Borrowers with a foreclosure within the previous seven years are ineligible for all transactions. Borrowers with a pre-foreclosure event (pre-foreclosure sale, short sale, or deed-in-lieu of foreclosure) within the previous seven years will be subject to the following requirements: Pre-foreclosure event within the previous 2 years: Ineligible, Pre-foreclosure event within the previous 2 to 4 years: 80% max LTV/CLTV, Pre-foreclosure event within the previous 4 to 7 years: 90% max LTV/CLTV Borrowers with a Chapter 7 bankruptcy within the previous four years, calculated from the discharge date, are ineligible. Borrowers with a Chapter 13 bankruptcy within the following time periods are ineligible: Four years from the dismissal date. Two years from the discharge date. Borrowers with multiple Chapter 7 or Chapter 13 bankruptcies within the previous seven years are ineligible. For both foreclosures and bankruptcies, the application date of the subject loan will be used to determine whether the borrower has satisfied the above waiting periods.

Back to topQ. How do I find out if Fannie Mae owns my current mortgage?

Fannie Mae makes it easy, just click here and fill out the blue box. Fannie Mae will tell you if the own your loan.

Back to topQ. How do I find out if Freddie Mac owns my current mortgage?

Freddie Mac makes it easy, just click here and fill out the blue box. Fannie Mae will tell you if the own your loan.

Back to topQ. What if my mortgage is not owned by Fannie Mae or Freddie Mac?

Currently, HARP 2.0 is only available to those that have loans owned by Fannie Mae or Freddie Mac. However, regardless of whether or not you have equity in your home, you may still qualify for traditional refinancing. There also may be other programs available to you. Please contact Harlequin Capital Corp for a No-Obligation FREE consultation.

Back to topQ. Do I have to verify income under the HARP 2.0 program?

In some cases, applicants will not have to document their income to qualify for HARP 2.0, although the lender must obtain a verbal verification of employment (possibly a paystub), and verify the borrowers source of non-employment income, plus obtain any other income documentation. Harp 2.0 has eliminated any maximum debt to income ratio requirements. Some lenders may require income documentation solely for the purposes of verifying your current job.

Back to topQ. Will a HARP 2.0 refinance reduce the principle amount I owe on my current mortgage?

No. The goal of a refinance under HARP 2.0 is to help underwater homeowners nationwide take advantage of todays historically low interest rates regardless of their current equity position. This will allow homeowners to get into a more stable / affordable home loan without needing an appraisal or income verification, in most cases. Refinancing under the HARP 2.0 program will not reduce your current principal balance or any other debt you owe.

Back to topQ. How long will the HARP program be available?

Currently, the program is set to expire December 31, 2013. All HARP 2.0 refinances must have a mortgage note date on or before that date.

Back to topQ. Are condominiums eligible for refinance under the new HARP guidelines?

Yes. Condos are eligible under the HARP 2.0 program that originally met Fannie Mae guidelines.

Back to topQ. I am currently late on my mortgage, can I still qualify under the HARP 2.0 program?

No. Homeowners who are currently late on their mortgage or have been 30 days past due or more in the last six months will not qualify for the HARP 2.0 loan based on current guidelines. Call Harlequin Capital Corp for a FREE consultation to see what your options may be.

Back to topQ. Can I get cash-out or consolidate debt under the new HARP 2.0 program?

No. The HARP 2.0 program does not allow for any cash out or debt consolidation. Please consult with Harlequin Capital Corp for any other products you may qualify for.

Back to topQ. What other qualifications do I need to be eligible for the new HARP 2.0 mortgage program?

To be eligible for the HARP 2.0 program, you must have closed your home loan and your loan must have been purchased and securitized by Fannie Mae by June 1, 2009.

Back to topQ. I'm WAY underwater on my current mortgage. Will the new enhanced HARP 2.0 allow me to refinance?

HARP 2.0 has an UNLIMITED loan to value (LTV). The original HARP program had a max ceiling of 125% LTV. Under the new HARP 2.0 program, regardless of your current equity position you may still qualify. While other lenders have overlays limiting their LTV limits, Harlequin Capital Corp has multiple lenders that will accept unlimited LTVs. For example, if you owe $375,000 on your mortgage and your approximate value is $150,000, you will STILL qualify at 250% LTV for the new HARP 2.0 program!

Back to topQ. Are there special HARP program interest rates?

No. Typically HARP rates follow traditional conventional rates. Due to additional risk of HARP 2.0 loans (high LTVs), the majority of lenders price these slightly higher than a standard 80% LTV refinance. We typically see HARP 2.0 rates at approximately 0.25% -0.75% higher than standard refinances. The benefit is millions of homeowners are still able to take advantage of todays historically low fixed rates, stay in their homes, reduce their monthly payment and save thousands over the life of the loan. The rate will typically be based on current market conditions at the time of the refinance inquiry. Homeowners will be subject to any associated points and fees quoted by your lender. HARP 2.0 loans come with no prepayment penalty or balloon payments.

Back to topQ. I got a divorce since my original home purchase. Can I remove my spouse from the mortgage through the new HARP 2.0 program?

Yes. Under the new HARP 2.0 guidelines, a borrower can be removed from the mortgage and deed through a HARP 2.0 refinance.

Back to topQ. My current bank says there the ONLY lender who can do the HARP loan for me. Is this statement really true?

This is more than likely FALSE. There are very few cases where your current lender is the ONLY institution that can help you. At Harlequin Capital Corp we encourage all HARP 2.0 applicants to contact us for a FREE consultation, in many cases we can say YES when your current lender says No.

Back to topQ. I make my monthly payments to Bank of America, Chase, Wells Fargo, GMAC or CitiBank, am I still eligible for the HARP 2.0 program?

Regardless of whether or not you make your current payment to a major bank, more often than not they do NOT own your loan, they just service the monthly mortgage payments. The majority of major banks loan portfolios are still owned by Fannie Mae or Freddie Mac, please click here or click here to see who owns your mortgage.

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