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Why your lenders aren't offering HARP 2 NOW

Discussion in 'HARP Mortgage Loan Program' started by Erik Sandstrom, Jan 25, 2012.

  1. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    Many people have been asking me why their lenders wont process their application for HARP 2, and also wondering why I can and they can't.

    Here's a few reasons:
    1. DU will be updated during the weekend of March 17, 2012 to recognize LTV ratios greater than 125%. This means for the system to be reflecting the changes with the appraisal waivers will not take effect until March 17th. One reason not to wait until March 17th? You will already have your new mortgage and if there's an appraisal required most likely you will have saved that in one or two months of your new mortgage payment. Another reason - You might just get an appraisal waiver! And yet a final reason we can always get the appraisal credited back onto your loan at closing.

    2. Unlimited LTV's are allowed effective with loan applications taken on or after January 1st, 2012 (with WJ Bradley).

    3. 10 and 15 year terms will be allowed with closings May 25th, 2012 and loan deliveries to FNMA on June 1, 2012.

    4. Loans cannot close until the transaction has a completely NEW DU run after March 17th, 2012 and receives a feedback of Approve/Eligible.

    5. SOME loans may still be eligible for a Property Inspection Waiver - this waiver comes with a $75.00 delivery fee that will NOT be passed on to the borrower.

    6. Minimum FICO for all borrowers of 620 is required.

    7. Desktop Underwriting will dictate the maximum DTI allowed.

    8. Transactions for 2nd homes or investment properties in which borrowers have greater than 4 financed properties are automatically allowed without an exception required from Secondary for FIXED rate loans. ARMS no longer allow this exception.

    ****Freddie Mac's guidelines are similar, if you would like details on that please e-mail me.*****

    Here's the main things to look for regarding HARP loans (which many of you know)

    1. Loan MUST be originated before May 31st, 2009
    2. Fannie Mae or Freddie Mac MUST be the investor of the loans (until further notice)
    3. Credit must be 620+
    4. No Mortgage Delinquencies in the past 12 months
    5. If the loan you're looking to refinance has been modified or a 2nd mortgage settled - you are NOT eligible to refinance.
    6. NO Foreclosure in the past 7 years
    7. Seasoning for Short Sales must be 4 years

    Those are the main requirements, feel free to contact me with other questions
  2. Cat Damiano

    Cat Damiano Mortgage Wars

    This is great information Erik, thank you so much for sharing your HARP knowledge with us.
  3. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    Hi Erik,

    I would be very interested to see how and if this HARP 2 NOW does pan out because every other program has been a failure thus far. Please post your results here and follow up on this.

    Thanks!
  4. Steve New Jersey

    Steve New Jersey LoanSafe Member

    Hi, I just found this site after searching for Harp 2 and I first want to say wow, this is an amazing site with so much information. Thank you for all that you do to provide all this information.

    My question is I have a bankruptcy on my record and want to know if that will affect me being approved. I have met all the criteria, credit score is back to 700 etc... Feb 9th will be 3 years since the discharge of the bankruptcy and I know there are some guidlines involving bankruptcy. Any advice or help would be greatly appreciated.
  5. Cat Damiano

    Cat Damiano Mortgage Wars

    HI Steve,


    Welcome to the forum and thank you for joining............

    I am sure that Erik will answer your question here, and you can also call him tomorrow and ask as well. Just keep in mind the three hour time difference from N.J. to CA. ;)
  6. Steve New Jersey

    Steve New Jersey LoanSafe Member

    Thank you for your reply and this wonderful site..
  7. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    I think I might have spoken to you already...I just posted a thread here which MIGHT be an alternative that people need to know about:
    http://www.loansafe.org/forum/refin...-but-have-significant-amount-assets-read.html

    It talks about Asset based lending, how it works and what you need to qualify.

    This is also a good read for people trying to purchase a new home with blemishes on their credit.
    Last edited: Jan 30, 2012
  8. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    I'm still catching up after the flu this past week which took a major toll on me! Oddly enough my physical was a week before this and my doctor asked me "So I see you haven't had a flu shot in the past 3 years, did you want to get one now?" Sure enough 2 days after I said no... it get's me! That will be the last time I say no to that question!
  9. Steve New Jersey

    Steve New Jersey LoanSafe Member

    Thanks for your reply, but I am only questioning the guidelines for refinancing with a bankruptcy. I have never been late my credit score is good, if I get a good appraisal I should be at 80 percent LTV as well. So, my question really goes to the rules for a bankruptcy. When I inquired last year I thought they told me it was 3 years from discharge. I will be 3 years from discharge on Feb. 9th so before I go applying anywhere and having my credit run I wanted to double check that with someone who might actually be able to tell me the truth.. Thanks for your help...
  10. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    When Desktop Underwriting for Fannie Mae is updated I will let you know! Hopefully we will get the exact guidelines in less than a month. As of right now it won't allow financing to borrowers with BK's.
  11. Steve New Jersey

    Steve New Jersey LoanSafe Member

    Thank you for your reply. I have been meeting to get to this site since Friday with my awesome news. On Friday I successfully qualified for the Harp 2 program. My LTV is 105 percent bankruptcy is 3 years ago, my credit score is 680 and my wife is 640. This was done with Bank Of America, so if they tell you there is a long wait ask again. I went into my local branch who gave me the phone number to the mortgage specialist who was able to take my application. The rate is a little higher than what the rates are out there, but considering my circumstances I needed this loan to be done. I think my credit score is what bumped the rate a little higher not the bankruptcy. I ended up with a 4.625 rate which is saving me close to 500 a month.

    BOA told me because of the bankruptcy they wouldn't be able to do a conventional loan till 5 years from discharge date although other banks have told me 4. Conventional loans however would have a problem with the ltv at 105 percent which is where harp came in. Anyway, It has been a long journey to this point having been denied twice modifications but it looks like I am on the right path now...
  12. arizonahome

    arizonahome LoanSafe Member

    Erik-
    I think the information you give on this site is invaluable and you are very knowledgeable. BUT, you fail to distinguish between Harp 2.0 refinance guidelines same servicer, and open access. Although I think we would all like to kick out our current services who are big banks, the more lenient underwriting guidelines for Freddie Mac (no DTI requirements, no credit score minimums, etc) for same servicer make some homeowners only option that of same servicer. Please speak to both, so those with questions about bankruptcy, DTI issues, etc can get a good answer on which path to pursue.... Thanks!
  13. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    [FONT=&quot]You're absolutely correct in distinguishing the Freddie Mac "Same Servicer" and Open Access guidelines, Same servicer guidelines are more lenient and seems to allow financing to homeowners with BK, credit issues...etc. This I just learned of today as a matter of fact on the guidelines which were released recently.

    It does not however allow certain programs to borrowers under the "Same Servicer" program under certain scenario's like BK. Under Open Access you can but has more of a conventional loan qualification procedure.

    I'm also being told with the new Fannie Mae Desktop Underwriting (DU) and Open Access guidelines that an appraisal will be required if LTV is above 125% HOPING THAT's not the case. [/FONT]
    :sad:
    Last edited by a moderator: Feb 15, 2012
  14. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    Congratulations, that's very exciting news Steve :bigsmile: I bet you can't wait for that loan to close! And yes under HARP 1 & 2 for lenders outside of your own it's a 4 year seasoning requirement from the discharge of the bankruptcy.

    I'm glad they're opening up financing to borrowers like you, it's obviously in there best interest to keep you as a client rather than foreclose on the property. Sorry to hear about the modification nightmare but the stress is over now! It's a smooth process from here compared to what you have been through, I'm sure of that!
    Last edited: Feb 15, 2012
  15. saigafreak

    saigafreak LoanSafe Member

    Any information as to titling? If I was the only name on the title for the original mortgage and I got married, can we still do HARP using combined income and co-borrowing?
  16. Erik Sandstrom

    Erik Sandstrom Mortgage Expert - Call 1-800-779-4547

    We can absolutely add a co-borrower to the loan, their liabilities would also come into play and would have to meet the same DTI requirements.
  17. jasonhoang

    jasonhoang LoanSafe Member

    Erik Sandstrom ! Thanks

    Eric !
    Thanks for answers all of my questions regarding to my HARP 2 questions via the phone today.
    You are my hero. It's great to have an expert like you to help us out.
    Once again, thanks

    Jason Hoang
  18. Cat Damiano

    Cat Damiano Mortgage Wars

    Hi Jason,

    Welcome to the forum and thank you for joining..........

    I am so happy that Erik was able to help answer the questions you have about the HARP refinance, he is quite knowledgeable of the ins and outs of the program.

    Are you in the process of trying to achieve the refinance under HARP?
  19. futureman

    futureman LoanSafe Member

    Looking forward to Harp 2.0, I guess in March 2012 ??

    Hello Erik,

    Since November I have been searching for a Lender to offer Harp 2.0, I understand after the DU is updated (what ever that is) in March I should find lenders that can process Harp 2.0

    Good news on my end is our LTV ratio is 124% WE owe 171,000 and Zillow says our house is worth 144,000.
    We took the refi in 2007
    We have never been late
    We have steady income
    We have a excellent FICA score as of today 2/24/12 (knock on wood)

    Thank God we have a President that cares.
  20. Cat Damiano

    Cat Damiano Mortgage Wars

    Hi futureman,


    Welcome to the forum and thank you for joining..........

    If you want to crunch the numbers for the HARP refi, you can contact Erik directly to compare interest rates with what you are being offered through the lender.

    He can be reached here;

    Erik Sandstrom
    Direct:
    (619)379-8999
    erik.sandstrom@wjbradley.com

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