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If you’re reading this post, you probably found this trying to figure out how to refinance your HARP loan that has PMI (Private Mortgage Insurance). Many of you have read my post about how Bank of America won’t do PMI HARP loans they service (http://www.keaneloans.com/2009/07/28/another-flaw-with-the-harp-program).
As it stands now, there are only a few confirmed sources that you can do a PMI HARP loan. FYI, this list is VERY limited. I will keep this updated as time goes along: For years, it has been standard for a mortgage company to request an IRS 4506-T request from their clients. This form allows the mortgage company to order the consumers tax transcripts with the consumers consent. Lenders would keep these forms in closed loan files in the event a transcript would be needed. Lenders did not actually send the request unless they felt there was something they needed to verify. Not anymore.
One of the changes we’ve seen in the mortgage industry is lenders requiring the actual transcripts in a loan file before they’ll close. This means that the tax return filings must be filed and ample time must be given for the IRS to update their database with the filed returns before a consumer can close on the loan. This process can take several months AFTER the IRS actually receives the tax returns! This has caused issues with consumers buying or refinancing who do not have filed tax returns due to extensions or the tax returns are filed but they’re simply waiting for the IRS to show them in their system. What happens if they can’t get the transcript? Simply put, most mortgage lenders will not let the consumer close on a loan. This is not an issue for many consumers but for the few who have late filings or amended returns, this could be disastrous. There’s a few major problems in the new FHA Short Payoff refinance that has been added to the “Making Home Affordable” family of solutions. I’ll later take the time to write the full details of this issue, but I need to get this message out over the next couple of days. The new FHA program includes new FHA guidelines that no longer allow an unlimited Combined-Loan-To-Value on FHA loans. This is a HUGE problem. Let me explain. Continue reading Problem with New FHA Short Refinance Program Many people who own investment properties don’t believe they can refinance their rentals due to equity (or lack thereof) . Since rental property loans require 25% equity on a traditional Fannie Mae or Freddie Mac loan, I understand why so many landlords do not attempt to refinance.
Continue reading HARP Loans- Perfect for Investment Properties Many homeowners who have less equity in their home are confused about their options available improving their loan terms. Should they be asking for a HARP (Home Affordable Refinance Program) refinance or a HAMP (Home Affordable Modification Program) modification? What the homeowner doesn’t know is they better find out before they call their lender. If a homeowner calls about lowering their payments and the customer service representative perceives the request as a modification, they may submit an initial application for a HAMP modification without the homeowner knowing exactly what they’re applying for. That’s where the problem begins. HARP guidelines state that a homeowner who has applied for a modification CAN NOT refinance using HARP guidelines. Homeowners who qualify for a HARP refinance and do not qualify for a HAMP modification may be destroying their only chance to reduce their payments without knowing it. Once they submit their HAMP modification application, they disqualify themselves for a HARP refinance. |
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