Loan Modification

HARP Here we come

The latest news on the new Home Affordable Refinance Program, HARP, is that Federal regulators have recently made key changes that will help borrowers who owe more on their loans than their homes are worth. Every week I receive inquiries from home owners who are current on their mortgages but can't refinance because their loan balances are higher than the value of their homes. The new HARP guidelines will help many homeowners reduce their interest rate. Based on today's rates this would be at or below the 4% range for a 30 year fixed loan.

There are two options with the new HARP changes. Timing is critical on both options and require clear understanding of your home's value. I am uniquely positioned as both a real estate broker and mortgage broker to assist you with this.

OPTION 1: Applications taken from December 1st 2011 to February 29th 2012 (yes, an extra day for us for leap year) are eligible for a loan to value (LTV) up to 125%. Appraisals will be necessary during this time period to determine the LTV. Unlimited combined loan to value ratios (CLTV) are acceptable. The combined loan to value ratio is the combination of your first mortgage and second mortgage or home equity lines (HELOC).

OPTION 2: Applications taken on or after March 1st 2012 are eligible for unlimited LTV and CLTV and this is where those most highly impacted by declining values will get relief. There has been no specific announcement if appraisals will be required but I think not since the plan is to allow unlimited LTV.

The following conditions will apply to both options:

  1. Current 1st mortgages must have closed prior to May of 2009.
  2. The loan cannot have mortgage insurance.
  3. Loans must be owned by Fannie Mae or Freddie Mac. Call or email and I can research this for you.
  4. Primary, Second Home, investment, and condos all qualify.
  5. Second mortgages can be subordinated with no maximum CLTV.
  6. You must have a qualifying credit score of 640 or more with no credit lates in the past 12 months.
  7. You will still have to qualify based upon income but the good news (better news?) is that with a significant decrease in interest rate your payments should go down.

Mortgage lenders are going to be swamped with applications on this program so right now is the time to get ready. Since applications must be dated no sooner than December 1, 2011 we can have everything ready to go so that we can submit the application as early as possible. For some of you it will be necessary to wait until March 1st 2012 but the anticipated rush will be even greater.

This is by far the best opportunity "underwater" home owners have had during the course of the recession.

If you are a home owner finding yourself in this position my advice is that we review your situation to determine if you are eligible and if it is best to proceed on December 1st or wait until March 1st.

Call or email me today! I will answer your questions and run the numbers to determine just how much money you can save each month!

Brian Leavitt

Designated Broker

Northstone Mortgage

MB 114722

MLO 114864

 


Refi Plus Now In Effect

The Making Home Affordable program announced by President Obama and the U.S. Department of the Treasury on 03.04.09 includes a new initiative, Home Affordable Refinance, to provide refinance opportunities to borrowers with mortgages held or guaranteed by Fannie Mae. This initiative is for borrowers who have demonstrated an acceptable payment history on their mortgage but due to a decline in home prices, have been unable to refinance to obtain a lower payment or move to a more stable product. Use this loan lookup tool to determine if your loan is held by Fannie Mae.

 

Many consumers, lenders and mortgage professionals like myself have been waiting for the Refi Plus Program sponsored by FNMA to go into effect.  We have been told it will on April 5th, 2009.  Below are bullet points that will summarize the benefits to home owners with mortgage loans:

 

·         No Minimum Credit Score Required.

·         New Lender Does Not Need to Be the Current Lender.

·         Reduced Income Documentation Allowed on All Loan Applications.

·         The automated system most lenders use (DU) will approve borrowers on this program. This will help increase the number of approved clients requesting Refi Plus.

·         If existing loan does not have mortgage insurance (MI), the new loan will not have MI regardless of the Loan to Value.

·         The New Loan must be a 5 year + fixed term loan (5, 7, 10 15, 30 year type loan).

·         Loan to Value ok up to 105% with an unlimited CLTV subject to the 2nd lender allowing the subordination.

·         3 to 4 unit only ok to 80% but after May 3rd, 2009, ok to 105% Loan to Value.

 

This program is now available through Northstone Mortgage

by Brian Leavitt Northstone Real Estate, Inc.

Brian Leavitt is a Licensed Real Estate Broker and a Licensed Mortgage Broker representing  Northstone Real Estate Inc and Northstone Mortgage.

Brian Serves clients within the Northwest Multiple Listing Service.

You can contact Brian directly by phone at 425-837-4700 or toll free at 800-806-3145 or by email at broker@northstone.net

Click here to see Brian's client newsletter.

Brian is licensed by the Washington State Department of Licensing and the Washington State Department of Financial Institutions License number 510-MB-19802 and is a memberr of the Seattle King County Association of Realtors and Northwest Multiple Listing Service.


Check your data before going out on a limb

A report this week issued by an Eastside Housing Coalition stated:

"I recently discovered that of the 114 houses on the market in Sammamish, 111 are in foreclosure.  The houses in foreclosure are nearly 1% of the entire Sammamish housing stock.  I don't have the statistics for Issaquah or other neighboring communities, but I do know there are a lot of people out of work who are running through their savings and starting to feel desperate."  The context of this statement is that if no intervention is available many of these families could end up homeless.  Problem is that the data is in error.  Foreclosure is a problem but not at the level reported.  As of this writing the numbers in Sammamish are as follows:

According to King County records there are 12,720 residential properties in the city of Sammamish.  As of 3/23/2009 433 are presently for sale or in escrow.  Of these 16 are bank owned which means they were acquired by the bank in a foreclosure sale or were transferred by the owner instead of a foreclosure.  There are 42 properties that have a notice of pending foreclosure filed with King County records against them.  This means that .00330% of the housing stock is in foreclosure.  .0969% of the homes for sale are in foreclosure.

I am not sure where the data was generated in the statement from the housing coalition but it is always wise to check your sources.  We all agree that foreclosure is a significant problem but it is not as large a problem as many people think.  In negotiating a short sale for a client this morning I was pleased to learn that the bank I am dealing with has created a division entirely devoted to negotiating alternative options for borrowers to avoid foreclosure.  The bank representative said that they are actively pursuing options to help people stay in their homes.  If that is not an option they will work with the borrower to assist in a transition to helm them into alternative housing.  If you are concerned about losing your home or if you know someone who is let us know.  We can help.  Refer to last weeks article regarding who is authorized by the Department of Financial Intuitions to assist in loan modifications and short sales in Washington.

by Brian Leavitt Northstone Real Estate, Inc.

Brian Leavitt is a Licensed Real Estate Broker and a Licensed Mortgage Broker representing  Northstone Real Estate Inc and Northstone Mortgage.

Brian Serves clients within the Northwest Multiple Listing Service.

You can contact Brian directly by phone at 425-837-4700 or toll free at 800-806-3145 or by email at broker@northstone.net

Click here to see Brian's client newsletter.

Brian is licensed by the Washington State Department of Licensing and the Washington State Department of Financial Institutions License number 510-MB-19802 and is a memberr of the Seattle King County Association of Realtors and Northwest Multiple Listing Service.