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Archive for Home Refinancing News

San Diego, California – One of the most common questions we get online today is in regards to HARP refinancing eligibility for people that have a second mortgage. The quick answer is YES, “The Home Affordable Refinance Program allows borrowers to refinance even if they have a 2nd mortgage.” NO, you cannot combine a 1st and 2nd mortgage together in a HARP refinance, but they will allow you to subordinate your current second lien and refinance your underwater 1st mortgage. So if you want to refinance under the HARP 2.0, your second mortgage lender must complete the subordination agreement. This makes choosing a HARP mortgage lender more important than ever, because you need to choose a company that has enough experience with the HARP 2.0 program that they handle the subordination end properly so that your loan will fund prior to your interest rate lock expiring. Get quotes from lenders offering mortgage pre-approvals that have experience subordinating with HARP 2.0.

HARP Refinancing with a Second Loan Being Subordinated is Allowed!

  • In most cases the lender you choose for the new HARP refinance will do the work to get your 2nd loan subordinated.
  • Of course it won’t hurt to let your 2nd mortgage lender know that you are refinancing your 1st lien and you will need their cooperation in the subordination process.
  • Ask how much they charge for the subordinating. (2nd lenders fees will vary)
  • Find out if getting the check to the 2nd lender upfront will streamline the process.

Unfortunately not all mortgage companies handle the subordination the same. If you are a hands’ on person who wants to help out then you need to know this up front.  Most borrowers do not want to deal with this, so they let their HARP lender handle the process of subordinating the 2nd mortgage. According to Pat O’Connell of VIP Mortgage in Orange County, choosing lenders for HARP is important. “It is imperative that you feel confident that your lender can handle the subordination process, because the average loan company will drop the ball.”

Refinancing with HARP Can Save You Thousands of Dollars a Year!

If you want to refinance with HARP will save you money every month than most likely it will be worth it for you to move forward even if you have to deal with a subordinating a 2nd loan. We suggest adding 15 days to your rate lock or floating the rate. For example, if you were refinancing with a 30-day lock, stretch it to 45-days if you have a second mortgage.

Today’s HARP rates have fallen to 3.5% (APR 3.74%) on thirty-year terms and 2.875% (APR 2.97%) on fifteen-year options. So use the rate calculators and do the math so you can determine how much you are saving. If you can save $600 a year then it is likely worth your time. If you are saving $2,000 or $3,000 a month like many of our clients then it is certainly worth the time. Take a few minutes and apply online for unique refinancing even if you have a 2nd mortgage the option is available for a HARP refinance.

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The U.S. economy has been fighting to escape the recession and the housing crisis has emerged as the National focus. Meanwhile the Obama Administration, the Federal Reserve and the entire mortgage industry have joined forces with record low refinance rates and aggressive home loan programs. Can these creative financial minds put an end to the unstable housing sector? Only time will tell, but we are giving these entities an “A” for effort.

This will be Remembered as the Era for Record Low Rate Mortgage Refinancing

The Mortgage Bankers Association announced earlier this month that 2012 has seen the lowest rates for mortgage refinancing since they have been keeping records.

The time for securing the best rate from a refinance loan has never been more right than today. Qualifying for these record low interest rates has been a challenge for many who have seen their incomes and credit scores fall in recent years.

The following refinance loans below have emerged as the leading refinance solutions in America at a time when finances are more important  than ever. The stakes are high for refinancing because many homeowners have an opportunity to save thousands of dollars a year.

1. HARP Refinance – The guidelines for the Home Affordable Refinance have seen drastic changes in 2012. Just try and stop these underwater borrowers from refinancing. Fannie Mae and Freddie Mac made the “loan to value” stipulations disappear for the first time ever.

2. FHA Streamline Refinance –The Federal Housing Administration nearly copied the refinance guidelines from Fannie and Freddie when the altered the home equity requirements to become a non-factor. No appraisal is needed now for existing FHA customers that seek to lower their interest rate through the streamline program. Another reason why the streamline has become so popular is that it is one of the few loans that do not require income documentation. Refinance lenders simply verify the borrower’s employment rather than examining their W2’s, pay-stubs and tax returns for income like most loans require.

3. Bad Credit Refinance –  The average credit score has plummeted in the last few years causing the demand for refinancing with bad credit to soar. Fortunately, Nationwide has become a subprime leader for refinancing. The VA continues to have no minimum credit score for borrowers seeking a refinance and FHA is only asking for a minimum credit score of 500.

4. Cash Out Refinance – With interest rates shattering record once again in 2012 it should come as no surprise that homeowners have been looking to get refinance and get cash out.  FHA allows cash back on 85% LTV refinancing and VA approved military borrowers to get cash back at 90% LTV. Conventional lenders have been requiring 80% LTV for borrowers that want money back and homeowners who are blessed with 20% home equity in their property continue to tap it because money is so cheap. Imagine how much money people are saving who are consolidating 20% credit card debt into a mortgage below 4 percent.

5. 30-Year Fixed Mortgage Refinance – With fixed 30-year rates available at 3.5% (APR 3.67%)  it makes sense that homeowners would migrate towards the most secure and affordable loan of all-time. With many refinance lenders easing the guidelines for the 30-year mortgage it has become a natural progression for new homeowners to refinance when the rates fall and the guidelines improve.

By now, most consumers understand that mortgage refinance loans cannot be this attractive forever. Expect to see interest rates jump when the housing crisis is visible in the rear-view mirror or if defaults begin to mount again. At the end of the day 2012 will be remembered for high unemployment and historic interest rate opportunities for mortgage refinance loans.

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The Home Affordable Refinance Program, which is now called HARP 2.0, has given new hope to homeowners that have been put in the corner from banks because they do not have enough equity in their home. Traditional refinance programs require home equity to be considered as sufficient collateral. The latest loan term for these types of homeowners is “underwater mortgage”, because the balance on the mortgage is greater than the home’s value, thus the term, “underwater.”

Fannie and Freddie Eliminated LTV Caps on the HARP Refinance Program

If you thought the 125% loans were aggressive, wait until you read about the latest HARP refinance guidelines that have absolutely omitted all “loan to value” requirements to refinance. The gives HARP mortgage lenders “Cart Blanche” to offer 200% and even 300% LTV refinancing in severely underwater regions like California, Florida, Nevada, New York, Virginia and Washington.

One of the most important steps for underwater homeowners is educated themselves. In addition to speaking with HARP mortgage lenders and finance professionals, we suggest reading the following articles below:

  • How to Refinance With No Equity
  • HARP Lenders for Refinance

Check out a few of the important HARP 2.0 requirements that we highlighted below:

  • Mortgage lien must have been sold to Freddie Mac or Fannie Mae before June 1, 2009
  • To qualify a borrower cannot be late on their mortgage payment. (Also, cannot have has any late payments reported in the past six months.
  • The borrower is allowed to have one payment reported late in the past year.
  • The borrower must be at a minimum of 80% “loan to value” presently
  • Applicant cannot have completed a mortgage refinance through the 1st Home Affordable Refinance Program or HARP 2.0.

Nationwide wants to stress now more than ever is the time to compare HARP mortgage lenders because rates and costs can vary significantly. Don’t forget to factor in “service” when shop HARP lenders either because underwriting advice and processing efficiencies can also range drastically as well. At this time, the Home Affordable Refinance Program is only valid until December 31, 2013.

If you believe that have a 1st mortgage owned by Fannie Mae, you may qualify for the HARP2.0, so you can get more help online at http://www.knowyouroptions.com/options-to-stay-in-your-home/refinance-option.  If you think your loan is owned or serviced by Freddie Mac, get more info on HARP refinancing program now at http://www.freddiemac.com/avoidforeclosure/alternatives_to_foreclosure.html#refinance.

If you still aren’t sure, we recommend discussing your goals with a Nationwide loan officer who will help determine if you meet the parameters for a refinance with the HARP 2.0.

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In the media “blame game”, Fannie Mae and Freddie Mac have taken a lot of heat for fueling the housing crisis and mortgage bail-outs over the last five or six years. Fixed 15 year rates fell below 3% for the first time ever last week and home refinancing applications continue to soar.

The Federal Housing Finance Agency, the entity that regulates Fannie Mae, Freddie Mac and the 12 Federal Home Loan Banks announced yesterday that the government mortgage powers, Freddie Mac and Fannie Mae completed over 2.3 million foreclosure prevention actions since the mortgage reform laws were passed in 2008. This included 1.1 million loan modifications that were deemed “permanent.” These mortgage relief initiatives were created to encourage homeowners to maintain their homes.

Fannie and Freddie Are Saving Homes with Aggressive Government Refinancing

People Forget the Fannie Mae and Freddie Mac have led key campaigns like the Rapid Refi and the Home Affordable Refinance Program that may end up helping millions of families keep their home.  Read the Freddie Mac Fact Sheet on Making Homes Affordable.

The FHFA detailed the good home financing news that was published in their first quarter 2012 Foreclosure Prevention Report. This report features an interactive Borrower Assistance Map for Fannie Mae and Freddie Mac owned home loans, with information as of March 31, 2012 on loan delinquencies, foreclosure prevention activities, REO properties and home loan refinances in each state. This FHFA report outlined crucial facts in regards to the largest 5-year drop in home prices and the biggest jump on seriously delinquent mortgages. FHFA went on to promise a “Refinance Report” that will provide specific details in regards to publishing data in regards to mortgage refinancing in the United States more quickly.

Homeowners Can Get More Advice from These Popular Nationwide Articles:

More specifics in the recent FHFA report:

  • Nine months after modification, less than 15% of home mortgages that received a note modification in the 2nd quarter of 2011 had missed two or more loan payments.
  • 50% of all borrowers who had their loans modified in the 1st quarter had their monthly mortgage payments reduced by over 30% and one-third included principal forbearance.
  • The top five states ranked by the percentage of the Enterprises’ single-family mortgages more than one year delinquent are: Florida, New Jersey, Georgia, New York and Maine.
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Economists, accountants and mortgage professionals agree that if you have the ability to save money and ensure security that home refinancing is a smart financial move. Right now, it is time to refinance. The market is lower than it has ever been and inflation is slowly rising again. After the mortgage crisis and the recession, it took some time for the economy to get back on its feet. It has, however, and that makes the Federal Reserve likely to raise interest rates very soon. You don’t want to have to risk losing the opportunity to get such low rates for refinancing because you don’t want to deal with the ‘hassles’ of getting your home appraised only to be turned down by your bank or a fast talking lender. Get in now, before inflation makes the record low rates disappear.  The chances of rates improving any more are very slim, while the rates the chances for refinance rates to rise in the next twelve months are very high.

 The 5 Best Loans for Home Refinancing

  1. Conventional Loan with No Mortgage Insurance
  2. 15-Year FHA Refinance Loan
  3. Refinance with a 100% VA Mortgage
  4. Cash Out Refinancing to 85%
  5. No Cost Mortgage

Figuring out how to refinance is your first step. You need to contact a lender and discuss your situation. Then, they will be able to give you the options that you have for refinancing your home, no matter what your situation might be. You can get a lower mortgage refinance rate in most cases, which will allow you to save money on your mortgage payments. Of course, being able to lock into a fixed rate for 15 or 30 years is another reason to consider refinancing. It just makes sense because there is not going to be another time like this when rates are so low. The 30-year fixed rate mortgage is the safest bet if you are not sure whether or not you will be moving anytime soon.

Refinance and Get Approved with Mortgage Rates as Low as 3.375% (APR 3.477%)

Save money with a lower rate, get the money that you need out of your home, or just refinance to get better terms in your mortgage. No matter your reasons for refinancing, you will be able to find low home refinance rates that are sure to suit your needs. Even people who have been turned down recently by a lender or bank should try again, because there is several new bad credit refinancing options. Talk to refinancing lenders as soon as possible about the loan approval process and figure out exactly what you need to know so that you can make the best decision.

Refinance Your Home Now Before Rates Go Up

You’ll obviously get lower rates if you have good credit to begin with. However, if your credit score is lower, you shouldn’t be discouraged because you do still have options. Whatever it takes, you can easily get the financing that you need so that you can lock in low rates with a refinance today. Never settle or assume that you are getting the best rate without doing a little comparison shopping, either. 5.25% might be good, but 4.5% would be better because it would lower your monthly payment and save you money. If you look, you can find great deals on refinance loans to lower your payments, get money for improvements, or just get on top of your mortgage for once and all.

It is hardly a secret that the best refinance loans  have been government inspired programs that the Obama administration has spear-headed. People are not really quite sure what Obama mortgage programs lie ahead for the President’s second term. Harp 3.0, principal reductions programs that target the middle class? Only time will tell…

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Do you need home refinancing for cash or simply a reduced interest rate for a lower monthly payment? Have you recently been rejected by a lender because they said your credit scores were too low?  Would it help your financial state if you were approved to get a home refinance for bad credit? Nationwide is a lender that offers a wide variety of home loan refinance solutions including, conventional, jumbo, VA and FHA home mortgage opportunities.

1. Make Sure There Are Tangible Benefits to Refinancing: Many people look into home refinancing because they want to reduce their monthly payments. However, you must make sure that you will be trimming off a significant amount to make the time, effort, and cash investment worthwhile. There are costs associated with refinancing to lower interest rate on your loan. If you find you are spending thousands to save pennies, you may want to wait to refinance when interests rates are better.

2. Shop Home Refinance Loans from Reputable Lenders: You want to make sure you are getting your loan from someone you trust. Dishonest lenders will lure you in with too good to be true interest rates but may tack on fees and add language in the contract that can cost you thousands in penalties. Always check the reputation of any financial institution you choose to do business with.

3. Compare the Loan Disclosures and the Good Faith Estimate: It is always a good idea to shop around for the best rate. However, don’t stop there. Make sure you read the fine print of the loan disclosures. A bank that seems to have a great rate may have language in their disclosure that allows them to charge you an exorbitant late fee if you don’t make your payments on time. Not only do you want the best fixed mortgage rates and lowest monthly payments, you want to make sure you won’t end up paying more than you need to.

4. Avoid a Pre-Payment Penalty: Reducing years on your home loan can save you thousands of dollars in interest. Therefore, it is important that the bank you get your loan from does not charge a pre-payment penalty fee. Banks add this fee to discourage you from home refinancing or paying your loan off early so they can get the full amount of the interest payments due to them. If your loan does include a pre-payment penalty see if you can negotiate it out altogether or at least a reduced amount.

5. Avoid Mortgage Insurance: Private mortgage insurance is type of insurance that banks will try to force you to get which basically guarantees the mortgage will get paid if you default on the loan. It may sound like a great idea on the surface. But it can add up to $1,000 per year per $100,000 borrowed to your loan. Do everything you can to avoid having this insurance tacked onto your loan.

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It wasn’t too long ago that homeowners were taking out home equity credit lines, using their house like an ATM machine to access cash.  Americans utilized home equity loans and credit lines to consolidate debt, finance home remodeling and some people even financed extended vacations.  Homeowners did not need any equity in their home and second mortgage lenders often approved credit lines without even requesting a formal appraisal.  In many cases, borrowers would convert their variable rate equity line into a fixed rate home equity loan once they used all of the funds.

Eliminate Compounding Interest & Refinance Credit Lines into a Fixed Rate Mortgage

Everything continued to go great for homeowners as property values continued to rise nationally and lenders continued to extend 2nd mortgage options.  In 2007 the mortgage debacle evolved into a full-fledged housing crisis that we still have not recovered from yet.  All of a sudden millions of homeowners found themselves stuck with a variable rate home equity line of credit or an equity loan that had a rate the borrowers were uncomfortable with as the economy started sinking. Guidelines for mortgage refinancing have changes so check with your loan officer for eligibility.

Second mortgage refinance options started dwindling as lenders began cutting and eliminating their home equity programs.  The few lenders that were left offering home equity lines tightened the guidelines significantly and now required more equity, higher credit scores.  If that wasn’t enough, the home equity lenders started requiring full income documentation and full URAR appraisals.

Many borrowers turned to refinancing because they continued to approve cash out loans up to 95%.  These FHA mortgage loan programs enable borrowers to consolidate debt and refinance credit lines and 2nd mortgages into their new 1st mortgage.  Still even with the more flexible FHA guidelines, many homeowners were unable to refinance home equity lines because their property values were declining rapidly.  With the adjustable rates contributing to higher monthly payments for the credit lines, many people could no longer afford their second mortgage and thus many homeowners defaulted.  Today, we recommend refinancing your credit line into your first mortgage. However, if you do not have the equity or credit scores needed to qualify, consider a second mortgage modification.

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