HARP 2.0 is a refinance program for a conventional loan that is currently owned by either Fannie Mae or Freddie Mac which allows you to refinance into a lower/current interest rate even if the value of your home has decreased dramatically, and the new loan would exceed 125% of the current fair value. An FHA Streamline Refinance is a refinance of an existing FHA loan, which permits you to refinance without having to obtain a current appraisal. As a result, any decrease in home value isn't taken into consideration as the new loan is based on the previous appraised value. There are a number of granular details for each program that I would recommed you review with a local lender vs. trying to fully understand via an online posting however. Best of luck if you're considering a refinance!Mar 15th 2012
HARP stands for Home Affordable Refinance Program and the "2.0" refers to the revised guidelines recently announced. The new rules are designed to allow more borrowers to successfully refinance, even if they are under water in their home equity. As a lender, we are hopeful that the homeowners who have been doing their best to stay in their homes and continue making their payments even though they have negative equity will finally be rewarded. Lower rates and reduced loan terms can help them build equity faster, which is ultimately needed for a true housing recovery. Many times, an appraisal won't be needed and the documentation required for underwriting & loan approval will be less intensive. To qualify, a borrower's loan must be owned by Fannie Mae or Freddie Mac. Many people don't realize that while they have a bank or lender who they make their monthly payments to, behind the scenes their lender has sold their loan to Fannie or Freddie and their bank is just "servicing" their mortgage. (Fannie and Freddie don't service loans or accept payments directly). Everyone's situation is slightly different so it is important to discuss yours with a lender. Start here... You can look up your loan here to see if Fannie or Freddie own your loan. If so, then you might qualify! www.makinghomeaffordable.gov/loan_lookup.htmlFHA Streamline Refinances are for loans currently insured by FHA, and refinanced into a new FHA loan. On many streamline refis, there is also no appraisal needed. In order for HUD to approve a streamline refi, there must be a demonstrated benefit to the borrower such as a reduction in rate & payment or by reducing the loan term. If reducing it to 15 years or less, the up front mortgage insurance premium is not required. With lower rates available today, many borrowers can benefit.Mar 15th 2012
I see that you have gotten an explanation of the difference between the two loan programs. I would like to offer you the opportunity to find out if one of these programs would fit your particular situation. I am a local lender here in WA and I specialize in government loans. A quick call to me would provide you with the answers so you could determine which loan would fit. I can be reached at (253) 536-5626-office or (866)350-6140-toll free. If your existing loan is FHA, it is an easier process and will have a lot better interest rate than what I see available for the HARP 2.0. Gary W Smith MLO#53963, First Priority Financial, Inc. http://www.cme4loans.comWA CL#774878; NMLS#3257Mar 15th 2012
Excellent answers from the Lender 411 brokers above. I would also suggest you contact a Lender 411 professional to tell them about your situation and how you might refinance. Each loan situation is unique and a mortgage professional can give you the answers to help you make the right decisions for you and your family. Good Luck...Mar 15th 2012
You would need to have an FHA loan currently in order to do an FHA streamline refinance. Plus, your loan must have been closed and sold before June 1, 2009. Is this the case? I think my colleagues have answered the other parts well. If you're way upside down and your loan is owned by either Fannie Mae or Freddy Mac (you can determine this by Googling Fannie Mae or Freddie Mac loan lookup. Or I can do it for you) this might be a better way to go. Again, your loan must have been originated before June 1, 2009. Let me know if you have any other questions. Thanks!PaulMar 15th 2012
Great question. Virtually nothing, except the type of loan you must have to get it. In many ways, HARP 2.0 was modeled after he FHA streamline loan. WIth FHA, you must have an existing FHA mortgage, there is no appraisal requirement and the supporting documentation is minimal. In the case of HARP, the current loan must be owned by Fannie or Freddie. No appraisal is required and supporting documentation is minimal. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ www.LoansA2z.comMar 16th 2012
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