Michael Patterson (MichaelPatterson)
#54 ranked lender in Washington - 71 contributions
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.