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Can I combine my first mortgage and HELOC into a single HARP loan?

by JEJones from Austin, Texas. Nov 12th 2012 Reply


Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 1,573 contributions

Not into a HARP loan. The only way to combine the two loans is if you have at least 3% equity in the property and can document that the HELOC was used to purchase your home. However, that would likely trigger PMI. So, usually it makes more sense to just refinance the first mortgage and leave the 2nd alone (resubordinate it to the new 1st). Sometimes the savings on the new 1st is enough to enable a customer to start paying down the HELOC and get rid of it. I can help you, call or email pdumouchel@primelending.com or 843.619.6025

Nov 12th 2012
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Brad Cahoone (info@globalhomefinance.com)
#1 ranked lender in Texas - 575 contributions

Is it a Fannie Mae or Freddie Mac loan? On October 20th,2012 Fannie Mae will allow you to roll in a second mortgage with stipulations on Loans submitted to DU 9.0 see guidance taken from fanniemae.com:DU Refi Plus EnhancementsWith Announcement SEL-2012-04, Fannie Mae further enhanced and clarified many DU Refi Plus(TM) and Refi Plus requirements, including allowing the simultaneous refinance of an existing subordinate lien. DU will be updated to align with those policy changes. The enhancements below will be made to DU Refi Plus.Simultaneous refinance of subordinate liensDU Version 9.0 will be updated to allow for the simultaneous refinancing of a subordinate lien on DU Refi Plus loan casefiles, provided that the new loan amount does not exceed the existing unpaid principal balance of the subordinate lien.**** Brad Cahoone ****972-724-3222 -ext 227bcahoone@globalhomefinance.com

Nov 12th 2012
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Brad Cahoone (info@globalhomefinance.com)
#1 ranked lender in Texas - 575 contributions

Also, I am not sure why you would subordinate a second mortgage in TX? If you know how and have a good title company and lender in TX on a rate and term refinance as long as your first mortgage is not exceeding the original Principal balance of the loan you should be able to renew and extend around the existing second. If you are cashing out on your first then you have to subordinate. The 2nd mortgage companies lawyers might call me later because they don't know TX law at a lot of these national lenders, but I just refer them politely to my title companies attorneys and the TX Dept of Insurance to get some education on the subject. A subordination request can be denied by your current lender and then you are stuck with the first mortgage and second mortgage loans you are in because they don't like the thought of losing a penny of their equity position. Also, the 2nd mortgage company will probably charge to subordinate. I like to close quickly and at a lower cost to my employers (you the customer). Call me with any questions on the subject. I always like to talk shop on things like this. Brad Cahoone - 972-724-3222 x 227- bcahoone@globalhomefinance.com - globalhomefinance.com

Nov 12th 2012
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Brad Cahoone (info@globalhomefinance.com)
#1 ranked lender in Texas - 575 contributions

My last post should have said the original principal balance plus $5,000 to renew and extend if you cannot roll in the second mortgage to avoid having to subordinate. Not just the original principal balance.

Nov 12th 2012
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Barb Lanis (BarbLanis)
#2 ranked lender in Illinois - 587 contributions

A Word of Caution when reading the Fannie 9.0 Release Notes. In the past, borrowers were not allowed to re-negotiate the existing HELOC and do a simultaneous closing. This meant that you could not handle refinancing both mortgages at the same time. In release notes 9.0, Fannie allows for this, but Be Careful of the Wording: "simultaneous refinancing of a subordinate lien" That DOES NOT mention that a DU Refi+ can roll in a portion, or all, of an existing HELOC. That would make zero sense. Why would Fannie take on the risk of another bank and their potential underwater position now or in the future. Not.

Nov 12th 2012
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