Mortgage refinancers rush to duck fee hike

Orlando Mortgage Lender FBC Releases Year End Central Florida Mortgage Report for 2011

Orlando, FL – January 10, 2012 – (RealEstateRama) — Orlando mortgage lender FBC recently released their yearend Central Florida Mortgage Report for 2011. Based on all of the data 2011 may be viewed as the year the mortgage and housing market leveled out after years of steep declines. Home prices, excluding condos, are up 6% over the preceding 24 months, rates are at all-time lows, and incomes of home buyers is on the rise. Below is an additional list of highlights for 2011:

• Refinance business has picked up significantly over the past 6 months as rates dip below 4 percent.
• More than 50% of buyers are utilizing conventional financing to purchase their homes. Shifting away from FHA and VA.
• Credit scores for Florida home buyers averaged 734. Historically a very high number but in-line with the current national average.
• Borrowers are putting more money down on purchases. 2 years ago down payments averaged close to 10% today the average down payment is approximately 20%.
• Affordability index remains very high as evidenced by average rent and mortgage payments being within a tight range.
• Loan amounts averaged close to $155,000 up 7% over the past 24 months.

Going into 2012 we are optimistic that these trends we saw in 2011 will continue. We are also anticipating a large refinance boom as existing Florida Homeowners take advantage of the new HARP 2 program which fully rolls out March 2, 2012. “The dark cloud seems to have lifted and 2012 looks to start strong” stated Rob Nunziata, Co-CEO & President, FBC Mortgage, LLC.

* All of the data contained in the report is compiled from financed properties located in Orange, Seminole, Volusia, Osceola and Lake Counties and excludes condos and distressed properties unable to obtain financing.

About FBC Mortgage
FBC Mortgage, LLC is an employee and community owned retail mortgage banker affiliated with the Florida Bank of Commerce. Headquartered in Orlando, Florida, with branches across the State of Florida and Mississippi, FBC Mortgage lender provides low rates on home loans (FHA, VA, Conventional, USDA), construction and 203k rehab loans. The award-winning company also specializes in refinancing home loans. Visit us on the web at www.fbchomeloans.com or call us at 1-866-413-2563 to schedule your free mortgage consultation.

Orlando Mortgage Lender FBC Mortgage Gives Back to the Central Florida Community this Holiday Season

FBC Mortgage, LLC prides itself on being a valuable partner in the communities they serve by supporting local charitable organizations with both in-kind and monetary donations
throughout the year.  This holiday season FBC Mortgage in conjunction with their generous staff, families and referral partners have been able to make this a very happy holiday season for local Central Florida families at the Coalition for the Homeless of Central Florida.

On December 15, 2011 FBC Mortgage hosted their Annual Holiday Party.  Staff and guests were asked to bring a new coat to the party to support the holiday initiative “Coats for Kids”.  At the holiday party and in conjunction with a partnership with Mix 105.1 Radio FBC Mortgage was able to collect over 160 new coats. The coats were distributed to the families at the Coalition for the Homeless of Central Florida. .  “With over 170 employees in the area we take pride in our commitment to the community and to the local agencies that serve those in need.  Especially during the holiday season we want to do our part to help Central Florida families have a Merry Christmas and Happy New Year”, stated Joe Nunziata, Chairman and Co-CEO of FBC Mortgage LLC.

On December 28, 2011 the staff from FBC Mortgage and Mix 105.1 Radio distributed the coats and served lunch to the families at the Coalition.  The families enjoyed a Pizza Party on behalf of FBC for lunch!  “Today was one of our first cold days in Central Florida this season so it was a great day to be able to donate the coats we collected for these families and also provide a hot lunch” stated Rob Nunziata, President and Co-CEO of FBC Mortgage, LLC.
About FBC Mortgage

FBC Mortgage, LLC is an employee and community owned retail mortgage banker affiliated with the Florida Bank of Commerce. Headquartered in Orlando, Florida, with branches across the State of Florida and Mississippi, FBC Mortgage lender provides low rates on home loans (FHA, VA, Conventional, USDA), construction and 203k rehab loans. The award-winning company also specializes in refinancing home loans. Visit us on the web at www.fbchomeloans.com or call us at 1-866-413-2563 to schedule your free mortgage consultation.

As seen on OrlandoSentinel.com: New refinance program targets ‘underwater’ owners current on payments

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New refinance program targets ‘underwater’ owners current on payments

By Mary Shanklin, Orlando Sentinel

November 30, 2011

Matt Hamilton has dutifully paid the loan on his Maitland house and a Longwood rental condo, but until now he could not refinance them to obtain more-affordable interest rates because the properties are financially underwater.

Starting Thursday, Hamilton and many of the other quarter-million Orlando-area residents with “underwater” mortgages can apply for a new Fannie Mae and Freddie Mac refinance program geared for pretty much everyone who owes more on a home than it’s worth — including landlords and second-home owners.

“It’s been difficult because I’m so far in the hole that no one wants to refinance me,” said Hamilton, a product developer for Longwood-based Onlinelabels.com. “But if you look at my payment history, I am a safe risk.”

The federal government’s previous foreclosure-prevention efforts, such as the Home Affordable Modification Program (HAMP), lowered the interest rates on mortgages of homeowners at risk of foreclosure because they had lost income. But the new Home Affordable Refinance Program (HARP) is seen as a possible game changer even for homeowners who are underwater but who have stayed employed and continue making their payments.

Homeowners who have missed mortgage payments in the past six months need not apply. And not all the details — such as loan limits — have been disclosed yet. But this is one of the first refinance programs that doesn’t require an appraisal to determine the value of the house.
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“It’s a reward for the responsible borrower who swallowed a bitter pill but still kept moving,” said Travis BeMent, mortgage-loan originator for Home Loans Today of Orlando. “There’re a lot of people out there ready to pounce on this.”

The HARP application process begins Thursday, just as new reports show that more than half of the mortgaged homes in Metro Orlando are saturated with more debt than they are worth. In all, 254,146 mortgaged homes in the four-county metro area are in that situation, according to a report released Tuesday by the mortgage-research company Corelogic.

Even though Orlando has a greater share of underwater homes than Florida overall or the nation as a whole, the percentage of “negative-equity” houses in the metro area actually decreased slightly during the third quarter: 51.6 percent of the mortgaged homes in Orange, Seminole, Osceola and Lake counties were worth less than their loans in the July-through-September period, down from 53.1 percent in the second quarter.

About 44 percent of the mortgaged houses in Florida, and 22 percent of those in the nation, were underwater in the third quarter, according to Tuesday’s report.

Many of those mortgages were sold to homeowners who purchased at the peak of the market in 2006-07, when sales prices were double what they are today and when interest rates ranged from 5.7 percent to 6.5 percent, according to the Orlando Regional Realtor Association. Today, interest rates on a 30-year mortgage are less than 4 percent.

One cautionary note about HARP: Interest rates could change by the time a qualified property owner’s refinancing application is processed, BeMent said. Fannie and Freddie are not expected to have the ability to process the new loans until as late as next March.

But HARP, he noted, also offers a break to homeowners who want to refinance for 15 or 20 years instead of 30 years. To qualify, an owner must have a mortgage backed by Fannie Mae or Freddie Mac and will likely need a credit score of at least 620.

Orlando lawyer Jeremy Sloane hasn’t missed any payments on a rental home he owns in east Orange County’s Avalon community, but he still loses money on the property every month because the mortgage he took out in 2006 far exceeds the rent he collects, now that prices have collapsed. He said he has already talked to FBC Mortgage about the new federal refinancing program.

“At the end of the day, I don’t think it’s anyone’s responsibility but myself to make the payments, but the frustrating part was that other people have been able to get out of their situation and not take a loss,” Sloane said. “This program will hopefully make it a lot more palatable renting out that house and not taking a loss.”

mshanklin@tribune.com or 407-420-5538

As seen on Bankrate.com: Mortgage rates remain low as HARP retools

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Mortgage rates remain low as HARP retools

Mortgage rates continued to hover near record lows this week, reflecting the efforts of the Federal Reserve to reduce long-term interest rates and the effects of a flood of cash fleeing the European debt crisis.

 

30 year fixed rate mortgage – 3 month trend

The benchmark 30-year fixed-rate mortgage fell 1 basis point this week, to 4.24 percent, according to the Bankrate.com national survey of large lenders. A basis point is one-hundredth of 1 percentage point. The mortgages in this week’s survey had an average total of 0.36 discount and origination points. One year ago, the mortgage index was 4.62 percent; four weeks ago, it was 4.38 percent. In Bankrate’s weekly rate survey, dating to 1985, the record low for the 30-year fixed is 4.21 percent, set Oct. 5, 2011.

The benchmark 15-year fixed-rate mortgage fell 3 basis points, to 3.47 percent. The benchmark 5/1 adjustable-rate mortgage rose 1 basis point, to 3.17 percent.

World events are conspiring to keep mortgage rates low for borrowers, says David Olson, president of Access Mortgage Research & Consulting in Columbia, Md.

“You’ve got the Federal Reserve trying to keep rates low, we’ve got a weak economy, and now we’ve got a flood of money coming from Europe escaping from the eurozone, which is collapsing,” he says.

On top of those factors, the strong dollar and low inflation expectations are keeping rates in check, Olson says.

“The dollar is strengthening as the euro weakens. It’s at $1.35 now; I was in Europe in June and it was $1.44,” Olson says.

Olson expects those rates to remain low into the foreseeable future as investors seeking a safe haven in the United States acquire safety in American mortgage-backed securities.

HARP 2.0 eases refi requirements

Underwater homeowners looking to take advantage of low mortgage rates got a shot in the arm this week.

The revamp continues for the Home Affordable Refinance Program. Some call it HARP 2.0. Fannie Mae and Freddie Mac announced changes to help more underwater homeowners take advantage of the program, which so far hasn’t had much effect on the foundering housing market.

“Overall, it stands to benefit a lot of people,” says Jim Sahnger, a mortgage loan officer with FBC Mortgage in Jupiter, Fla. “Everyone’s going to have their own opinion about whether it is or isn’t enough, but I think it’s going to be very helpful.”

He says the changes will be particularly welcome in the states hardest hit by the housing crisis, where many homeowners owe much more than their homes are worth. That’s because the cap on loan-to-value ratio, once set at 125 percent for 30-year mortgages and 105 percent for 15-year mortgages, has been removed. That cap had been a major roadblock for millions of underwater homeowners in troubled markets, Sahnger says.

Beleaguered homeowners will find it easier to afford those loans once they qualify, Sahnger says. Fannie and Freddie cut the maximum amount they will charge for loan-level price adjustments, the fees added to some HARP refis to compensate for risk. For loans with terms of 20 years or less, there will be no fees at all, and for 30-year mortgages, it may mean a lower surcharge of about 75 basis points, Sahnger says.

Lastly, borrowers who have gone through a bankruptcy or a foreclosure will no longer have to wait for a set period and re-establish credit to qualify for a HARP refinance.

“It really appears that they’re trying to make (HARP) as beneficial and easy to qualify for as possible,” Sahnger says. “You’re certainly not going to be able to please everyone, but you’re going to please a lot of people here.”

While most of these changes are scheduled to take effect Dec. 1, with the fee change coming as of Jan. 3, the impact of the changes may not be felt until March in some cases, says Sahnger, because they require changes to Fannie Mae’s underwriting software. Also, the new guidelines will only apply to refis of mortgages owned by Fannie Mae or Freddie Mac. Federal Housing Administration, or FHA, mortgages won’t be eligible.

You can find out if Fannie Mae owns your mortgage using their Loan Lookup tool. Freddie Mac also has a lookup tool.

Read more: Mortgage Rates Remain Low As HARP Retools | Bankrate.com http://www.bankrate.com/finance/news/mortgage-rates-remain-low-as-harp-retools.aspx#ixzz1dyOBFoU4

As seen on BizJournals.com: Federal mortgage program rules set to change Nov. 15

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Bill Orben

Associate Managing Editor – Orlando Business Journal

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Mortgage lender Joe Nunziata has Nov. 15 circled on his calendar.

That’s when the Federal Housing Finance Agency’s Home Affordable Refinance Program’s 125 percent loan-to-value requirement will be eliminated. That will make it easier for Nunziata’s Orlando-based FBC Mortgage LLC to help people refinance Freddie Mac- and Fannie Mae-backed mortgages, even if they owe more than their homes now are worth.

And that, said University of Central Florida economist Sean Snaith, ultimately will help everyone else in the region. “It will put money back in the pockets of homeowners who will spend money in other areas of the economy.”

For the Orlando economy to recover, the housing market must improve, Snaith said. “The housing market is the key battle in this war on recession.”

The nation’s real estate bust in recent years drove down home values: The median price in Central Florida in July 2007 was $264,436, compared to $115,000 in September 2011. And that gap between what homeowners paid for their home and the current value made refinancing nearly impossible.

Now, homeowners with Fannie Mae- and Freddie Mac-backed mortgages who are current on their payments could save up to $600 a month, which is expected to reduce the number of properties sliding into foreclosure.

Home loan interest rates averaged 6.5 percent in 2006, compared to 4 percent-4.25 percent today, so refinancing would save the homeowner of a $400,000 home about $618 a month. At an average interest rate of 6.5 percent in 2006, the monthly mortgage payment would be $2,528, but that would fall to $1,909 with a 4 percent interest rate.

“It greatly reduces the chance of someone walking away” from their home, said Nunziata, who expects the federal change to increase the number of monthly loans made by FBC Mortgage by roughly 30 percent.

Others agree the rule change will help the housing market because fewer properties in foreclosure could stabilize, maybe even boost, home values. With home values uncertain, potential buyers delay purchases because they believe they may pay less by waiting to buy. The median price of a bank-owned home was $82,000 in September, or $70,000 less than a traditional home sale.

“Any time you can get a house out of a distressed situation and homeowners back on their feet financially, that is a good thing,” added Stephen N. Baker, owner of Re/Max Central Realty of Lake Mary and chair-elect of the Orlando Realtors group.

Not everyone is excited by the coming changes to the federal refinancing program, though.

They may help some homeowners, but they’re not a “market changer,” said Jack McCabe, a Deerfield Beach-based real estate consultant. “Unless loan modifications change the rate, term and mortgage principal, they are not going to work.”

As seen on OrlandoSentinel.com: Condo sales threatened by loss of FHA backing for loans

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Condo sales threatened by loss of FHA backing for loans

Orlando’s condominium market, one of the hardest-hit in the country, faces further challenges because of federal policy changes that now limit mortgage financing for buyers seeking to purchase available units.

Of 68 condo complexes in the Orlando area, 44 have already lost a big part of their financial lifeblood: the mortgage-backing power of the Federal Housing Administration, which generates loans with some of the lowest down payments in the industry.

Another 12 complexes in Orlando are scheduled to lose their FHA approvals in the next six months.

In the past, most condominiums received open-ended approvals for FHA-backed mortgages, but the government changed that policy in 2009 and started limiting approvals to two-year terms. With those initial two-year approvals expiring this year, homeowner associations are now at a loss for how to get their condo complexes back on the federal mortgage-guarantee list.

“You’ve taken away a really viable purchasing tool at a time when the economy would really benefit from those buyers,” said Fort Lauderdale lawyer Sandra Krumbein, who specializes in condominium law.

“Homeowner associations now have to get approvals [every two years], and that’s what’s causing the hoopla,” she said. “The associations and their managers have no idea what to do to get approved.”

Nationally, 25,000 condominium projects lost their FHA approvals from the U.S. Department of Housing and Urban Development during the first nine months of this year, and fewer than 10 percent of those have been reapproved or recertified. A condominium must have the approval before buyers can purchase its units with FHA mortgages.

Orlando real-estate agent Maria Garcia said she has represented buyers interested in purchasing condominiums who have had to look elsewhere because so few of the complexes locally are approved. And those that have approvals, such as the Vue at Lake Eola tower in downtown Orlando and condominiums in Baldwin Park, often have price tags and association fees that are too rich for first-time buyers, she said.

Faced with a limited pool of cash buyers, she added, most condominium complexes will see their prices slip further as a result.

“It’s not a good outlook for condominiums,” Garcia said. “The financing is pretty much the biggest issue. That’s hindering the market — the ability to get financing — and the property will continue to depreciate.”

A general lack of mortgage financing for condominiums has already taken a toll on prices. House prices have dropped, too, but not nearly as much as condo prices. In Orlando, the median condo price has fallen 64 percent since 2006, from $166,100 to $60,500 as of September. House prices, meanwhile, have fallen 52 percent during that time, from $262,900 to $125,200, according to Florida Realtors.

And while condo prices nationally dropped 18 percent from 2008 to 2010, they fell 57 percent in the Orlando area.

A HUD spokesman said the reason so few condominiums have found their way back onto the FHA mortgage-approval list is that some association boards may not, for whatever reason, want the federal green light for such mortgages. Also, some condo projects may be plagued with problems that prevent re-approval, such as having too many investor-owners or too few financial reserves.

Orlando mortgage broker Rob Nunziata, who sits on the boards of several condo and homeowner associations, said such boards are so busy dealing with day-to-day upkeep and financial issues that their members generally aren’t focused on the importance of getting back on HUD’s mortgage-approval list.

“Over the last couple of years, it’s been very important — especially with the first-time buyer who does not have the 20 [percent] to 30 percent down payment needed to get the Fannie Mae or Freddie Mac loan,” said Nunziata, president of FBC Mortgage Inc. “It is extremely valuable and helpful if a condo is FHA-approved.”

HUD issues the FHA stamp of approval for condominium complexes. In the past, the federal agency periodically recertified particular condominium projects, and it also had the power to pull a complex’s FHA approval if it was having serious problems. But now condo complexes automatically lose their federal mortgage backing after two years, and their associations have to apply to get back on the federal list and attest that the development is free of any potential problems.

Even though the federal government does not charge condo associations to apply to get back on the FHA-financing list, association members may put themselves at risk of prison time and fines if they assert that a condo community has no problems involving legal issues, construction flaws or other disputes, some industry experts say.

As a result, associations are basically forced to hire lawyers or groups with FHA-approval experience, those experts say, and that expertise costs money.

Orlando Mortgage Lender FBC Mortgage Offers New HARP Mortgage to Homeowners

FOR IMMEDIATE RELEASE Contact: Stephanie Simmons 407-377-0327
Email: ssimmons@fbchomeloans.com

Orlando Mortgage Lender FBC Mortgage Offers New HARP Mortgage to Homeowners

Orlando, Florida – Orlando Mortgage Lender FBC Mortgage, LLC based in Orlando Florida announced it will be offering the Obama administrations recently announced enhanced HARP (Home Affordable Refinance Program) Mortgage. These changes will significantly benefit borrowers who have loans that are owned by either Fannie Mae or Freddie Mac and closed on or before May 31, 2009. Borrowers that have had no mortgage late payments in the last 6 months and no more than 1 in the last year may be eligible to refinance regardless of the borrowers equity or appraised value! The FHFA will be announcing further guidance on November 15, 2011. Borrowers need to get their preliminary loan application in with a mortgage banker so they can see if they will qualify for the new HARP loan. “Finally the government is rewarding borrowers who did the right thing and remained current on their payments even when the value of their house dropped considerably,” stated Rob Nunziata, President and Co-CEO of FBC Mortgage LLC.

FBC Mortgage will be offering HARP loans in Florida, Texas, Mississippi, Alabama, Connecticut, Tennessee, and Colorado. States that charge taxes on new loans will also see a new revenue stream from the sudden spike in refinances. “Millions of borrowers across the country that have remained in good standing on their mortgage will now be able to take advantage of some of the lowest rates in history. In addition we are hoping that this will help stem the amount of foreclosures and short sales in some of the states hardest hit by the downturn in housing”, stated Joe Nunziata, Chairman and Co-CEO of FBC Mortgage LLC.

You can check the following sites to see if you have a Fannie Mae or Freddie Mac loan that may be eligible for this particular program http://www.FannieMae.com/loanlookup/ or https://ww3.FreddieMac.com/corporate.

About FBC Mortgage
FBC Mortgage, LLC is an employee and community owned retail mortgage banker affiliated with the Florida Bank of Commerce. Headquartered in Orlando, Florida, with branches across the State of Florida and Mississippi, FBC Mortgage lender provides low rates on home loans (FHA, VA, Conventional, USDA), construction and 203k rehab loans. The award-winning company also specializes in refinancing home loans. Visit us on the web at www.fbchomeloans.com or call us at 1-866-413-2563 to schedule your free mortgage consultation.

As seen on Sun-Sentinel.com: Obama, court plans could help Fla. struggling homeowners

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Obama, court plans could help Fla. struggling homeowners

By William E. Gibson and Donna Gehrke-White, Sun Sentinel

8:19 p.m. EDT, October 24, 2011

Tens of thousands of struggling South Florida homeowners could benefit from proposals unveiled by White House and state court officials.

President Barack Obama on Monday said “we can’t wait” for Congress to act and issued orders to make it easier for underwater homeowners to refinance. .

About 48 percent of homeowners with mortgages in Broward County are underwater, according to the research firm CoreLogic. In Palm Beach County 42 percent owe more than their homes are worth. Most of these homeowners haven’t been able to take advantage of record-low mortgage rates, CoreLogic reports.

Obama will revamp the Home Affordable Refinance Program by eliminating some appraisals and underwriting requirements.More than 890,000 homeowners nationwide have already refinanced under the HARP program, which is available to borrowers with loans backed by Fannie Mae and Freddie Mac that were taken out before May 31, 2009.

Meanwhile, a panel led by Judge William Palmer of the Second District Court of Appeal is recommending the Florida Supreme Court overhaul a required mediation process for homeowners in foreclosure to ease the state’s housing crisis. The panel thinks the program, which has not led to many mediation settlements, is keeping Florida from rebounding from the foreclosure crisis.

South Florida accounts for more than a third of the state’s backlog of 260,815 foreclosure cases.

Here are answers to some questions about the two proposals:

Q: Who would be affected by the Obama refinancing plan?

A: Potentially millions of underwater homeowners nationwide could benefit, federal officials say. That includes hundreds of thousands of Florida homeowners, estimates Rob Nunziata, president of FBC Mortgage, a brokerage based in Orlando.

Until now, homeowners who were more than 25 percent underwater could not use the HARP program, excluding many families in Florida and other boom-to-bust states where housing values have plummeted.

“We have too many Americans who have done all the right things – who have paid their bills, they are current on their mortgages – yet they are still stuck with 6- or 7-percent mortgages because home prices in their neighborhoods have made them ineligible for refinancing,” said Shaun Donovan, secretary of Housing and Urban Development.

Q: What are the restrictions?

A: Homeowners must be current in their mortgage payments. Only homeowners with mortgages created before June 2009 that are owned or backed by government-controlled Fannie Mae and Freddie Mac would be eligible.

Mortgage amounts must be more than 80 percent of the current market value of homes. Officials are talking about dropping that limitation.

It does not help the 3.5 million Americans who are seriously delinquent in their loans or in the process of defaulting.

Q: How would this reduce the cost of refinancing?

A: It would eliminate risk-based fees and reduce “closing costs” when settling on a revised loan. That includes reducing the cost of title insurance and fees for processing liens.

Appraisals – which evaluate the value of homes – would be automated in most cases, eliminating or reducing the need for appraisal fees.

The Treasury Department also is contacting officials in hardest-hit states such as Florida to explore ways to further reduce closing costs.

Under the revamped program, Fannie and Freddie would reduce the fees they have charged to enable borrowers to better afford the new loans.

As seen on FoxBusiness.com: Revised HARP Could let More Owners Refinance

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Revised HARP Could let More Owners Refinance

By Polyana da Costa

Published October 25, 2011

Bankrate.com

Regulators have made key changes to a mortgage refinance program designed to help borrowers who owe more on their loans than their house is worth.

The revamped version of HARP, the Home Affordable Refinance Program, is expected to help about 1.8 million borrowers take advantage of today’s low mortgage rates, according to the Federal Housing Finance Agency. Under the revised version of HARP, borrowers will be able to refinance their mortgages regardless of how much their homes have fallen in value.

The program failed to meet regulators’ expectations when it was launched in March 2009, partly because borrowers who were deeply underwater on their mortgages could not refinance, as HARP limited refinance loans to no more than 125% of the value of the home. The new HARP will not have a cap.

“I think this is going to make a huge difference in hard-hit markets like Florida,” says Rob Nunziata of FBC Mortgage in Orlando, Fla. But it’s too early to tell, he and others in the mortgage industry say.

If you are one of the many underwater homeowners seeking to take advantage of the HARP changes to grab a lower mortgage rate, there’s no need to rush to apply to refinance yet. Lenders don’t have the final, detailed guidelines on the HARP changes. The FHFA says it will provide the guidelines to lenders by Nov. 15. After that, it will vary by lender on how quickly they adopt and implement their changes. Chase says it will not adopt the rule removing the loan-to-value cap until the first quarter of 2012.

For now, here are the main changes in the program and how they may affect you:

The 125% loan-to-value cap, which prevented borrowers from refinancing if the value of their homes had tumbled, has been removed.
Borrowers will not need a new property appraisal if Fannie and Freddie have enough data in their automated valuation system to estimate the value of the property. This not only speeds up the refinancing process but also eliminates the appraisal fee.
Certain fees associated with the risk of the mortgage loan will be reduced. Those fees will be eliminated for borrowers who refinance their mortgages into a shorter-term loan such as a 20-year mortgage or a 15-year mortgage.
The program, which had been scheduled to expire in June 2012, has been extended through the end of 2013.
Those who bought a house as their primary residence but now hold the property as an investment will be able to refinance through HARP at an additional cost.
Lenders will be waived of certain liabilities on the original loans if they refinance those loans through HARP.

Waiver of Lender Liability

The changes related to the lender’s liability on these loans are designed to entice lenders to embrace HARP. When lenders sell loans to Fannie and Freddie, they give promises (called “representations and warranties”) that pledge that the loans were underwritten to meet Fannie and Freddie requirements. Fannie and Freddie have forced lenders to buy back many bad loans for alleged violations of reps and warranties. Under the revamped HARP, lenders would have a chance to be released from liability on the old loans.

“I don’t see why they wouldn’t go for it,” Nunziata says.

“I think that’s going to encourage lenders to do more HARP refis,” says Ed Conarchy, a banker at Cherry Creek Mortgage Co. in Vernon Hills, Ill. “It all comes down to reps and warranty. It will be interesting to see how the details shake out by Nov. 15.”

For the most part, many lenders refused to lend above 105% of the property’s value even though the old guidelines permitted 125% loan-to-value mortgages. Mortgage experts say they hope lenders will become more flexible now that the cap has been lifted. If lenders embrace the program, underwater borrowers will line up to take advantage of the new HARP, Conarchy says.

Qualifications

Only mortgages sold to Fannie and Freddie on or before May 31, 2009, are eligible for refinance under HARP. Borrowers must be current on their loans and have no late payments in the last six months.

Mortgages that have lender-paid mortgage insurance cannot be refinanced through the program. Mortgages that have borrower-paid mortgage insurance may refinance, but borrowers must keep the same level of mortgage insurance they had on the previous loan.

Borrowers with second mortgages will still need the approval from their second lenders to refinance through HARP. That has been one of the biggest obstacles to those who have tried to use the program to get a lower rate.

Homeowners who have already refinanced through HARP are ineligible to refinance again.

“The new HARP program prevents homeowners from participating twice,” says Dan Green, a loan officer at Waterstone Mortgage in Cincinnati. “The original HARP homeowners, therefore — the ones from 2009 — are now stuck with their 5.25% mortgage rates.”

Green says he wishes FHFA would have made changes to allow those who bought homes in the last two years to refinance under the program.

“The new HARP program is closed to homeowners who have bought new homes over the last 24 months,” he says. “That excludes a huge group on borrowers that could benefit from HARP.”

Read more: http://www.foxbusiness.com/personal-finance/2011/10/25/revised-harp-could-let-more-owners-refinance/#ixzz1btvJlw9W