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Harp 2.0 Refi Process: 2nd Mortgage Subordination Agreement

Hello, Soon, I will be applying for a Harp 2.0 refinance on my property in Florida (applying through my 1st mortgage holder). I also have a 2nd mortgage on the property and understand that Harp 2.0 requires that my 2nd mortgage holder must agree to subordinate to the 1st mortgage holder.My questions are: 1) Does the 1st mortgage holder need the 2nd mortgage holder's subordination agreement BEFORE or WITH the Harp 2.0 application that I will be sending to my 1st mortgage holder, or is this subordination agreement obtained DURING the Harp 2.0 application evaluation process?2) Who is responsible for getting the 2nd mortgage holder's subordination agreement? In other words, will my 1st mortgage holder contact and solicit this agreement from my 2nd mortgage holder once I submit my Harp 2.0 application to my 1st mortgage holder, do I need to contact and solicit this agreement from my 2nd mortgage holder, OR do we (me and my 1st mortgage holder) BOTH need to contact and solicit this agreement from my 2nd mortgage holder?3) Lastly, are the above steps (and order of steps) to obtain a 2nd mortgage holder's subordination agreement in the Harp 2.0 application process STANDARD and followed by ALL 1st mortgage holders, or does each 1st mortgage holder have its own steps and order of steps (perhaps depending on state regulations) in the Harp 2.0 process?Thank you so much in advance for any help and/or input regarding my above questions; it's greatly appreciated! by lermel_606_423 from Orlando, Florida. Jul 24th 2012 Reply


Hi, the subordination is requested by your lender of choice in junction with the title company during the process, you don't have to do anything other than give your lender what they ask for to get an approval and closing. I wouldn't go to your current servicer if I were you I have 25 lenders and consistantly beat the rates and costs ALL DAY LONG.....

Jul 24th 2012
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The new 1st lien lender will take care of the process. You will be required to send a check to the 1st lien lender for them in turn to send it to the 2nd lien company. This amount is in the ballpark of $250. WORD OF ADVICE, shop you loan with other lender. You will probably get a lower rate, lower fees, and close much faster. Good luck to you.

Jul 24th 2012
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Generally the lender processing the new HARP loan will do most, if not all of the leg work. It doesn't hurt to let your current second lender know what you are doing. Also, you can learn how much they will charge for the subordination fee. By getting the check to the lender doing the new loan early, you can shave a couple of days off the process for them, which only benefits you. As for do they all do it the same way? NO. Every lender is different, so it's best to say on top of it. Finally, you should only use your current lender as a last resort. I have dozens of files where my rate/fee combination is thousands less than the "deal" they thought they were getting from their bank. If you don't shop, your bank will only take advantage of you. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.com 888-889-9950

Jul 24th 2012
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1).. big mistake going through your current servicer.. There will be much better deals out there for you, so you should shop with a local mortgage broker and compare... 2).. The subordination agreement will be ordered by your lender or title company and most are only good for a few weeks.. so timing is crucial.. Let your lender handle it.. 3).. Your lender will call and talk to the 2nd about the subordination agreement.. If they will subordinate, then it's ordered once your file has been submitted.. Most lenders will make the subordination a condition to close. 4).. you 2nd mortgage company will charge you to prepare the subordination agreement.. Usually around $250 or so. 5).. All you have to do is apply with your lender, provide a copy of your most recent 2nd mortgage statement, and let them handle it.. That's what they are getting paid to do.. If they need your help, they will contact you.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Jul 24th 2012
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Working with a licensed professional loan officer is the best way to get your questioned answers. You indicated you will be applying through your current 1st lien holder. That means you will be working with an unlicensed application clerk. When working with your largest financiual transaction of your life, the qualify of you loan officer is too important to dismiss.

Jul 25th 2012
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Enter your answer hereWe have one if not the best lender for HARP. I just closed one with the exact same scenario. The second mortgage company will have to subordinate per a formal request from your new lender and you will pay a fee for that subordination generally $100-$200. The 2nd lender has to agree and this will be a condition of the approval but not required up front to apply or even submit. Feel free to contact me at your leisure to discuss this: or email me - smccracken@winterwood.netSean McCrackenWinterwood Mortgage Group317-885-4560 ext 132

Jul 24th 2012
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As everyone here has stated, your first mortgage company will take care of it. Some 2nd mortgage companies will just add the small fee to your next mortgage statement or to your pay off. It depends on the lender. I know Citi does that, you do not have to pay the fee up front.

Jul 24th 2012
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Hello again all! I tried to "reply" to the posted answers, but I didn't see a "reply" button, so I'm "answering" my own question in my effort to reply. First, thank you all for your responses to my questions; I cannot express my appreciation enough! Second, I do have some follow-up questions in response to your below answers to my originally posted questions: 1) Several of you suggested "shopping around" in reference to what I'm assuming is the Harp 2.0 refinance I'm applying for with my 1st mortgage holder; am I to assume by your "shopping around" suggestions that I am actually permitted to apply for a Harp 2.0 refinance with a DIFFERENT mortgage lender from the one who currently holds my 1st mortgage? If this is the case, I had NO idea I could do that! Again, if this is the case, does that mean I can just call up banks X, Y, and Z, and ask them for Harp 2.0 refinance quotes regarding my situation? 2) One of the replies mentioned a "servicer," which has prompted me to clarify my original question post. Warning though: my below clarifications may be irrelevant tangents and/or generate a bunch of new responses: My 2nd mortgage was originally with Flagstar, but then was transferred to a "servicer" (SLS) in 2010 (my 1st mortgage lender is still the original lender). Upon researching who actually owns my 2nd mortgage, I learned that it is now a Flagstar GMS Trust 2007 (Asset Backed yada yada yada). Just out of curiosity, I've begun to look this trust up on the SEC's Edgar in order to find out who the trustee is. Anyway, my question regarding this tangent info is, does it matter that my 2nd mortgage is now in the hands of a "servicer?" FYI-When I spoke to the 2nd mortgage "servicer" today, they were MORE than willing to talk to me about "modifying" the loan, or negotiating a reduced "payoff" (big surprise there! lol). Given I have this additional "servicer" party involved, who is actually IMPORTANT in this situation (a Harp 2.0 refinance) regarding the 2nd mortgage: the 2nd mortgage "servicer" (SLS) OR the actual current "creditor" (Flagstar GMS Trust 2007)? I may be a "lay person," but I'm an academic and a scholar, and I DO my research! :) Again, I genuinely appreciate any input! Thank you, thank you, thank you!

Jul 24th 2012
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Hello. You can and should get another quote for your Harp 2.0 refinance. You can apply with any lender you want. It does not matter which lender is holding or servicing your second mortgage. We have a Florida Harp 2.0 loan in now that originally started out with their current lender and we gave them a better deal. We are mortgage brokers that deal with many many lenders and we can find you the lowest rate for your HARP 2.0 refinance. Please give me a call tomorrow to discuss more. 754-444-9705 Michelle

Jul 24th 2012
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YES, you can shop your loan with ANYONE you want to, but do not call BANKS! Look for local brokers that can help you. If you need help finding someone, at the top of the page here you will see a tab that says "Find A Lender". Click on the tab, and you should be able to find a few that can help you out. NO, it does not matter who is "servicing" the 2nd lien.

Jul 24th 2012
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The 1st mortgage holder will take care of the subordination of the 2nd. However, it is not guarenteed that the 2nd will re sub. Good Luck!

Jul 25th 2012
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