The new, revamped HARP program is now available in Texas and   nationwide. It was officially released Saturday, March 17, 2012 by Fannie Mae and Freddie Mac.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the conforming mortgage loan product meant for “underwater homeowners”. Under the HARP program, homeowners in Austin can get access to today’s low mortgage rates despite having little or no equity whatsoever.

HARP is expected to reach up to 6 million U.S. homeowners who would otherwise be unable to refinance.

HARP is not a new program. It was originally launched in 2009. However, the program’s first iteration reached fewer than 1 million U.S. households because loan risks were high for banks, and loan costs were high for consumers.

With HARP’s re-release — dubbed HARP 2.0 — the government removed many of HARP’s hurdles.

In order to qualify for HARP, homeowners must first meet 3 qualifying criteria. 

First, their current mortgage must be backed either Fannie Mae or Freddie Mac. Loans backed by the FHA or VA are ineligible, as are loans backed by private entities. This means jumbo loans and most loans from community banks cannot be refinanced via HARP.

• To check if your loan is Fannie Mae-backed, click here.
• To check if your loan is Freddie Mac-backed, click here.

The second qualification standard for HARP is that all loans to be refinanced must have been securitized by Fannie Mae or Freddie Mac prior to June 1, 2009. Mortgages securitized on, or after, June 1, 2009 are HARP-ineligible.

There are no exceptions to this rule.

And, lastly, the third HARP qualification standard is that the existing mortgage must be accompanied by a strong repayment history. Homeowners must have made the last 6 mortgage payments on-time, and may not have had more than one 30-day late within the last 12 months.

If the above three qualifiers are met, HARP applicants will find mortgage guidelines lenient overall :

• Refinancing into a fixed rate mortgage allows for unlimited loan-to-value
• The standard 7-year “waiting period” after a foreclosure is waived in full
• Except in rare cases, home appraisals aren’t required for HARP

Furthermore, HARP mortgage rates are on par with non-HARP rates. This means that HARP applicants get access to the same mortgage rates and loan fees as non-HARP applicants. There’s no “penalty” for using HARP.

To apply for HARP, check with your loan officer today.

The government’s new, revamped HARP program is 6 weeks from release. Homeowners in Texas and nationwide are gearing up to refinance.

HARP is an acronym. It stands for Home Affordable Refinance Program. HARP is the government’s loan product for “underwater homeowners”. HARP makes current mortgage rates available to households which would otherwise be unable to refinance because the home lacks equity.

This is a big deal — especially today. Mortgage rates are at an all-time low and millions of U.S. homeowners have been unable to take advantage. HARP aims to change that.

HARP originally launched in 2009. Its first iteration failed to reach a meaningful percentage of U.S. homeowners, however, because costs were high and loans were high-risk. With its re-release, the government has removed the hurdles to HARP, putting refinancing within reach for millions of U.S. households.

To qualify for HARP, homeowners must first meet 3 qualifying criteria.

First, their current mortgage must be backed Fannie Mae or Freddie Mac. FHA- and VA-backed loans are HARP-ineligible, as are jumbo loans and loans backed by portfolio lenders.

• To check if your loan if Fannie Mae-backed, click here.
• To check if your loan if Freddie Mac-backed, click here.

Second, the existing mortgage must have been securitized by Fannie Mae or Freddie Mac prior on, or before, May 31, 2009. If you bought your home or refinanced it after that date, you are HARP-ineligible.

There are no exceptions to this rule.

And, third, the existing mortgage must be accompanied by a strong repayment history. Mortgage payment must have been paid on-time for the last 6 months, at least, and there may not be more than one 30-day late payment in the last 12 months.

If these 3 qualifiers are met, HARP applicants should find the approval process straight-forward :

• Fixed rate mortgages allow unlimited loan-to-value
• The standard 7-year “waiting period” after a foreclosure is waived in full
• Except in rare cases, home appraisals aren’t required

Furthermore, HARP mortgage rates are expected to be on par with non-HARP rates, meaning that HARP homeowners in Texas will get the same rates and pay the same fees as everyone else. There’s no “penalty” for using HARP.

The revamped HARP is expected to be generally available beginning Monday, March 19, 2012.

To get a head-start on HARP, check with your loan officer for the complete list of HARP eligibility requirements.

The Federal Home Finance Agency announced big changes to its Home Affordable Refinance Program Monday. More commonly called HARP, the Home Affordable Refinance Program is meant to give “underwater homeowners” opportunity to refinance.

With average, 30-year fixed rate mortgages still hovering near 4.000 percent, there are more than a million homeowners in Texas and nationwide who stand to benefit from the program overhaul.

To qualify for the re-released HARP program, you must meet 4 basic criteria :

1. Your existing home loan must be guaranteed by Fannie Mae or Freddie Mac
2. Your home must be a 1- to 4-unit property
3. You must have a perfect mortgage payment history going back 6 months
4. You may not have had more than one 30-day late payment on your mortgage going back 12 months

Most notable about the new HARP refinance program, though, is that the government is waiving loan-to-value requirements on a HARP loans. Homeowners’ participation in the program  are no longer restricted by their home’s appraised value. In fact, the new HARP doesn’t even require an appraisal, in most instances.

With the new HARP program, underwater mortgages can be refinanced without LTV limit or penalty.

According to the government’s press release, pricing considerations for the new HARP program will be released on or before November 15, 2011; and lenders are expected to be offering the program as of December 1, 2011.

If you think you may be eligible, first confirm that either Fannie Mae or Freddie Mac is backing your loan. Both groups provide a simple, online lookup.

• Fannie Mae loan lookup : http://www.fanniemae.com/loanlookup/
• Freddie Mac loan lookup : https://ww3.freddiemac.com/corporate/

If your loan cannot be located on either of these two sites, your current mortgage is not backed by Fannie Mae or Freddie Mac, and is not HARP-eligible.

The FHFA’s official press release contains an FAQ section. In it, you’ll find minimum qualification standards, as well as information related to condominiums and to mortgage insurance.

The HARP program is meant to help a wide group of homeowners, but each applicant’s situation is unique. For specific HARP questions, be sure to talk with a loan officer.

If you’ve been running into issues refinancing your mortgage the “conventional” way, here’s some good news – The Federal Housing Finance Agency has extended the government’s Home Affordable Refinance Program by 12 months.

HARP’s new end date is June 30, 2011.

Originally known as Making Home Affordable (MHA), HARP aims to help Texas homeowners refinance their mortgage who may otherwise be ineligible because of falling home values.

I have written about MHA before, and think its a great tool to have if you (or someone you know) is just “stuck”.

Here are the 4 basic HARP criteria every borrower must meet:

1. The existing home loan must be guaranteed by Fannie Mae or Freddie Mac.
2. Your home must be a 1- to 4-unit property
3. You must have a perfect mortgage payment history going back 12 months. No 30-day lates allowed.
4. Your first mortgage balance must be 125% or less of your home’s market value

If you’re not sure whether Fannie Mae or Freddie Mac holds your mortgage, you can easily look it up on their website (http://www.fanniemae.com/loanlookup); Freddie’s is http://freddiemac.com/mymortgage.  If you don’t find your mortgage loan on either website, your mortgage is backed by a third-party and is not HARP-eligible.

For homeowners that meet HARP’s criteria, there are some underwriting details of which to be aware.

First, if your original mortgage does not require mortgage insurance, your HARP mortgage will not require it, either — regardless of your new loan-to-value.

Second, all HARP refinances require income verification. It doesn’t matter if your original mortgage was a stated income or no income verification loan. You should expect to produce 1040s and W-2s for your HARP refinance and asset statements, too.

And, lastly, second (and third) mortgages may not be “rolled in” to a new first mortgage loan balance. Lien holders other than first position must agree to remain in their  junior lien position, regardless of combined loan-to-value, so no subordinations.

There is a really good and thorough HARP FAQ section on the government’s website, but it’s for general questions only. For specific Home Affordable Refinance Program information, first make sure you’re program-eligible, then pick up the phone to call your loan officer.

HARP is not the easiest thing in the world, so before diving head first into this, make sure to get with your loan officer…or with me.

————————————————————————————————————————————————————————-

Tommy is a senior mortgage consultant with Envoy Mortgage. For a free mortgage consultation, you can email him at
tommy@tr-mg.com. You can also find him on Twitter at @RightMtgGuy.

—————————————————————————————————————————————————————————

Mortgagee Letter 2009-39

TO:                             ALL APPROVED MORTGAGEES

ATTENTION:          Single Family Servicing Managers

SUBJECT:                Updated Claim Filing and Delinquency/Default Reporting Requirements

For FHA’s Making Home Affordable Modification Program (FHA-HAMP)

The purpose of this Mortgagee Letter is to provide updated claim filing and delinquency/default reporting requirements for the FHA Home Affordable Modification Program (FHA-HAMP).  FHA – HAMP was announced in Mortgage Letter 2009-23, issued on July 30, 2009.

Implementation of FHA – HAMP required system enhancements to both the Department’s Claim System and its Single Family Default Monitoring System (SFDMS).  As with the standard FHA Loss Mitigation options, FHA will include FHA-HAMP Loss Mitigation options in its Tier Ranking evaluation of Loss Mitigation.

Single Family Default Monitoring System (SFDMS) Enhancements:

Both the FHA Connection and HUD’s EDI TS 264 application are now ready to accept two updated SFDMS status codes that mortgagees shall use to report HAMP related loss mitigation actions.  Status Codes 39 and 41 are now available for the industry to begin SFDMS reporting on FHA-HAMP related loss mitigation initiatives.  The specific reporting requirements are outlined in the following section.  FHA recognizes that some industry participants may require additional time to complete the required system changes.  Therefore, mortgagees may begin using the updated SFDMS status codes immediately, but mortgagees must begin reporting the updated status codes beginning with the January 2010 reporting cycle.  That report is due to HUD no later than February 5, 2010, which is the fifth business day of February 2010.

Updated Single Family Default Monitoring System (SFDMS) Instructions

Status Codes 39 and 41 are now available for the industry to begin reporting on FHA – HAMP related loss mitigation initiatives as follows.

• Code 39- FHA-HAMP Trial Modification Plan - Prior to the January 2010 reporting cycle, mortgagees that use the FHA Connection for SFDMS reporting or that have the system capability, will report mortgagors that have been approved for an FHA – HAMP trial payment plan as SFDMS  Status Code 39.  For a limited time, (only through the December 2009 reporting cycle), those mortgagees who are not using the FHA Connection and their systems are not yet ready to support the updated status codes may report the trial FHA-HAMP repayment plan as Status Code 12 – Repayment Plan.

No later than the January 2010 reporting cycle, all mortgagees must report mortgagors approved to begin the FHA-HAMP trial payment plan as SFDMS Status Code 39.

• Code 41 – FHA-HAMP Modification and Partial Claim Started – Prior to the January 2010 reporting cycle, mortgagees that use the FHA Connection for SFDMS reporting or that have the system capability, will report mortgagors that have successfully completed the FHA – HAMP trial payment plan and will begin the process to complete the FHA-HAMP Modification and Partial Claim as SFDMS Status Code 41.

Also prior to the January 2010 reporting cycle, those mortgagees who are not using the FHA Connection and their systems are not yet ready to submit the updated status codes will report the completion of the trial FHA-HAMP repayment plan and the beginning of both the FHA-HAMP modification and Partial Claim as Status Codes 10 and 28 (Partial Claim Started and Modification Started).

No later than the January 2010 reporting cycle, all mortgagees must report mortgagors that have successfully completed the FHA – HAMP trial payment plan and will begin the process to complete the FHA-HAMP Modification and Partial Claim as SFDMS Status Code 41.

Reinstatement of any of the above examples shall be reported as SFDMS Status Code 98- Reinstated.

Appendix 1 to this Mortgagee Letter is an update to Appendix 1 of Mortgagee Letter 06-15.  While there are no changes to Appendix 2 of Mortgagee Letter 06-15, it is reprinted for industry convenience.

Claim System Enhancements for FHA-HAMP:

HUD’s Claim System enhancements are also now available.  The drop-down menu on the FHA Connection screen for Loss Mitigation Claim Input will include additional claim type options named ‘FHA HAMP-Loan Modification’ and ‘FHA HAMP-Partial Claim.’  These new selections will identify Loan Modifications and Partial Claims being filed as part of the FHA-HAMP initiative apart from a standard Partial Claim and a standard Loan Modification.  Mortgagees shall select the appropriate claim type when filing for the FHA-HAMP incentives.  Appendix 3 revises and supersedes the Claim instructions included as Attachment B to Mortgagee Letter 2001-02, and adds specific instructions for filing both the FHA-HAMP-Partial Claim and the FHA-HAMP-Loan Modification.  This means that Mortgagees will actually need to file two separate claims, FHA-HAMP Partial Claim and FHA-HAMP-Loan Modification to receive the incentive payments that are provided by FHA upon successful completion of the HAMP loss mitigation initiative.

Loan modifications and partial claims being filed as part of the FHA-HAMP initiative must be submitted only through FHA Connection to ensure that they are processed as a FHA-HAMP related Loss Mitigation option.  Any FHA-HAMP related claim that is submitted using paper Form HUD-27011, Single-Family Application for Insurance Benefits cannot be correctly processed or paid.

Any questions regarding this Mortgagee Letter may be directed to HUD’s National Servicing Center (NSC) at 888-297-8685 or sfdatarequests@hud.gov.  Persons with hearing or speech impairments may reach this number via TDD/TTY by calling 1-877-TDD-2HUD (1-877-833-2483).

Sincerely,

David H. Stevens

Assistant Secretary for Housing-

Federal Housing Commissioner

Attachments:

Appendix 1 – Delinquency/Default Status Codes

Appendix 2 – Delinquency/Default Reason Codes

Appendix 3 – Claim Filing Assistance for Loss Mitigation Claims

Paperwork Reduction Act

The information collection requirements contained in this document have been approved by the Office of Management and Budget (OMB) under the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520) and assigned OMB control numbers 2502-0060, 2502 and 0429.. Additionally, the Department has submitted an expansion package to OMB for 2502-04249, where approval is pending.  In accordance with the Paperwork Reduction Act, HUD may not conduct or sponsor, and a person is not required to respond to, a collection of information unless the collection displays a currently valid OMB Control Number.