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How to refinance after HAMP modification? Who can refinance in California (Ventura county)?

I just did HAMP, passed trial period, modification was settled and I already did my first modified payment. In fact, the modification result is that my principal was reduced from $630K to $490K, but the percentage remained the same -5.5% for 37 years. Of course, I accepted this, because the total payment is less than it used to be. As I (and probably you) see now, the house is still not affordable, because I am 50 y.o. If I would be able to refinance the loan for lower % and 15-20 years - then it may become affordable. Can you, please, recommend me how to proceed in this situation? or, can you recommend a bank/broker who can do refinancing in California? by plapte_801_208 from Goleta, California. Nov 6th 2012 Reply


Bert Carpenter (BertCarpenter)
#37 ranked lender in Arizona - 1,823 contributions

You are probably going to have trouble. If the funds to reduce your principal came from an outside source, it may be possible, but if the principal reduction was done by the bank servicing your loan, it is likely that Fannie (or Freddie) has already taken a loss and this will exempt you from participating in a HARP refi. Also, if you are having problems making the payments on a 37 year loan, you are still going to have problems on a 15 or 20 year loan even at a lower rate. I have no investors willing to consider a HARP after a modification under any circumstances. My advice to you is this... If you can't afford the payment after the bank wrote off $140,000, you should probably look at selling and buying something cheaper. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950

Nov 6th 2012
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Hello. When was your loan closed from the last refinance or purchase? Not the date your loan was modified. You may be eligible for a harp refinance

Nov 6th 2012
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Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 2,243 contributions

I believe you are going to have trouble finding a lender to refinance a mortgage that has been modified. The details of your situation and qualifications will make a difference inlcuding credit score, loan-to-value, debt ratio's etc. You might check back with the current lender, especially if you've been current on the mortgage. If another lender on this site thinks they can help investigate the option but make sure they are clear in what your options are going to be.

Nov 6th 2012
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Dan Marchiando (dan@yourbestinterest.net)
#469 ranked lender in California - 29 contributions

My understanding is that once you do a Modification, then your future options are severely limited. Fannie Maes current (August) guidelines say:"Modified MortgagesA modified mortgage is a loan that was legally modified after loan closing in a way that changedany of the loan terms or attributes reflected in the original note. In general, mortgage loans withmaterial modifications, such as changes to the original loan amount, interest rate, final maturity,or product structure, are not eligible for delivery to Fannie Mae."This would seem to imply that you won't be able to do a conventional Agency (Fannie and presumably Freddie) refinance until they change their guides again. I didn't research your options regarding FHA or VA.Best of luck,Dan

Nov 6th 2012
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Dan Marchiando (dan@yourbestinterest.net)
#469 ranked lender in California - 29 contributions

My understanding is that once you do a Modification, then your future options are severely limited. Fannie Maes current (August) guidelines say:"Modified MortgagesA modified mortgage is a loan that was legally modified after loan closing in a way that changedany of the loan terms or attributes reflected in the original note. In general, mortgage loans withmaterial modifications, such as changes to the original loan amount, interest rate, final maturity,or product structure, are not eligible for delivery to Fannie Mae."This would seem to imply that you won't be able to do a conventional Agency (Fannie and presumably Freddie) refinance until they change their guides again. I didn't research your options regarding FHA or VA.Best of luck,Dan at YourBestInterest dot net

Nov 6th 2012
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Addition: There is only one option to obtain load modification is to stop paying. Yes, I was late for one payment before the modification process started. Also, the date the loan was closed is January 2006.I see the only option - stop paying and just stay in the house until bank will move me out; then rent for 2 years and then buy another house wit lower percentage. Any underwater stones in this scenario?

Nov 6th 2012
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Chris Gummerson (cgummerson11)
#392 ranked lender in California - 648 contributions

What are current rents going for in your area? I would not recomend letting the home go to a foreclosure, then you are going to be stuck for 3 years for a FHA loan and up to 7 years for a conventional loan. What if you were able to rent your home, maybe take a small loss. Have another person carry most of your mortgage payment. Then rent a small apt. Save up some money and purchase a home with 3.5% down FHA. If you let the home go, you may wind up having to wait many years before you can purchase again. At that time, the prices may increase and interest rates may rise...Then you may have let the home go for no benefit. Just a thought. Good luck

Nov 6th 2012
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Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 2,243 contributions

The fact that it has been 5 years since the modification is definitely in your favor for trying to refinance, but it won't be possible if you still owe more than the home is worth. I would count on a minimum of 3 years if you do a short sale on your home. Your age shouldn't have anything to do with the affordability of the home unless you are worried about the cost when you retire by which time values almost certainly will have recovered enough for you to get out from under it and move on to something lower cost. Good luck

Nov 7th 2012
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Phil Dumouchel (PhilDu)
#1 ranked lender in South Carolina - 2,243 contributions

Sorry, I misread the additional info. How long ago the modification was may make a difference in refinance options.

Nov 7th 2012
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