Important Note: Fannie Mae and Freddie Mac are scheduled to provide full details of the program, including information to lenders, by Nov. 15. The FHFA says some lenders may be able to start offering the program by Dec. 1, although most estimates are of a rollout in the first quarter of 2012 for most participating lenders. Chase Bank and mortgage lender Genworth have already indicated they look forward to participating.

Here’s what I know so far. Get a HARP refi quote now.

What Is HARP?

HARP was started in April 2009. It goes by several names. The government calls it HARP, as in Home Affordable Refinance Program.

The program is also known as the Making Home Affordable plan, the Obama Refi plan, and Relief Refinance.

In order to be eligible for the HARP refinance program :

1.Your loan must be backed by Fannie Mae or Freddie Mac.
2.Your current mortgage must have a securitization (originated and bought by either institution above) date prior to June 1, 2009
If you meet these two criteria, you may be HARP-eligible. If your mortgage is FHA, USDA/ VA or a jumbo mortgage, you are not HARP-eligible.

HARP : Questions and Answers

Do these question-and-answers account for the “new” HARP program?

Yes, everything you are reading is accurate as of today, October 25, 2011. This post includes the latest changes rolled out by the Federal Home Finance Agency on October 24, 2011.

How do I know if Fannie Mae or Freddie Mac has my mortgage?

Fannie Mae and Freddie Mac have “lookup” forms on their respective websites. Check Fannie Mae’s first because Fannie Mae’s market share is larger. If no match is found, then check Freddie Mac. Your loan must appear on one of these two sites to be eligible for HARP. Make note of how you type in your address at both these sites. Sometimes it must match exactly what is on your current mortgage statement.

If my mortgage is held by Fannie Mae or Freddie Mac, am I instantly-eligible for the Home Affordable Refinance Program?

No. There is a series of criteria. Having your mortgage held by Fannie or Freddie is just a pre-qualifier.

Is “HARP” the same thing as the government’s “Making Home Affordable” program?

Yes, the names HARP and Making Home Affordable are one in the same.

My mortgage is held by Fannie/Freddie. Now what do I do?

Find a recent mortgage statement and write “Fannie Mae” or “Freddie Mac” on it — whichever group backs your home loan — so you don’t forget. Give that information to your lender when you apply for your HARP refinance.

What if neither Fannie Mae nor Freddie Mac has a record of my mortgage?

If neither Fannie nor Freddie has record of your mortgage, your loan HARP-ineligible. However, you may still be eligible for a “regular” refinance to lower rates. Got to my site and request a quote to see your options. Or, if your mortgage is insured by the FHA, you can use an FHA Streamline Refinance.

Am I eligible for the Home Affordable Refinance Program if I’m behind on my mortgage?

No. You must be current on your mortgage to refinance via HARP.

Will the Home Affordable Refinance Program help me avoid foreclosure?

No. The Home Affordable Refinance Program is not designed to delay, or stop, foreclosures. It’s meant to give homeowners who are current on their mortgages, and who have lost home equity, a chance to refinance at today’s low mortgage rates.

What are the minimum requirements to be HARP-eligible?

First, your home loan must be paid on-time for the prior 6 months, and at least 11 of the most recent 12 months. Second, your mortgage must have been sold to Fannie or Freddie prior to June 1, 2009. And, third, you may not have used the HARP program before — only one HARP refinance per mortgage is allowed.

Is there a 125% loan-to-value restriction for HARP?

No, there is no 125% loan-to-value restriction. All homes — regardless of equity — are eligible for the HARP program.

I am really far underwater on my mortgage. Can I use HARP?

Yes, you can. There is no loan-to-value restriction under the HARP program.

Maybe I wasn’t clear. I am really, really far underwater on my mortgage. Are you sure I can use HARP?

Yes, I am sure. The new HARP program specifically has no loan-to-value restriction so that homeowners in Florida, California, Arizona and Nevada can take advantage of it. You can 300% loan-to-value, and still be HARP-eligible. HARP is now unlimited LTV.

Will my home require an appraisal with the HARP program?

Sort of. Although your home’s value doesn’t matter for the HARP program, lenders will run what’s called an “automated valuation model” (AVM) on your home. If the value meets reliability standards, no physical appraisal will be required. However, your lender may choose to commission a physical appraisal anyway — just to make sure your home is “standing”.

Is HARP the same thing as an FHA Streamline Refinance?

No, the HARP program is administered through Fannie Mae and Freddie Mac. FHA Streamline Refinances are performed through the FHA. The programs have similarities, however.

Do I have to HARP refinance with my current mortgage lender?

No, you can do a HARP refinance with any participating mortgage lender.

So, I can use any mortgage lender for my HARP Refinance?

Yes. With the Home Affordable Refinance Program, you can refinance with any participating HARP lender. Click here for a HARP rate quote from me.

I put down 20% when I bought my home. My home is now underwater. If I refinance with HARP, will I have to pay mortgage insurance now?

No, you won’t need to pay mortgage insurance. If your current loan doesn’t require PMI, your new loan won’t require it, either.

I pay PMI now. Will my PMI payments go up with a new HARP refinance?

No, your private mortgage insurance payments will not increase. However, the “transfer” of your mortgage insurance policy may require an extra step. Remind your lender that you’re paying PMI to help the refinance process move more smoothly.

What’s the biggest mortgage I can get with a HARP refinance?

HARP refinances are limited to your area’s conforming loan limits. In most cities, the conforming loan limit is $417,000. However, there are some cities in which conforming loan limits are as high at $625,500.

Can I do a cash-out refinances with HARP?

No, the HARP program doesn’t allow cash out refinance. Only rate-and-term refinances are allowable.

Can I refinance an investment/rental property with HARP?

Yes, you can refinance an investment/rental property with HARP, even if the home was once your primary residence. You can refinance a home on which you’re an “accidental landlord” via HARP. The loan must meet typical program eligibility standards.

Can I refinance a second/vacation home with HARP?

Yes, you can refinance an second/vacation property with HARP, even if the home was once your primary residence. The loan must meet typical program eligibility standards.

Are condominiums eligible for HARP refinancing?

Yes, condominiums can be financed on the HARP refinance program. Warrantability standards still apply.

Can I consolidate mortgages with a HARP refinance?

No, you cannot consolidate multiple mortgages with the HARP refinance program. It’s for first liens only. All subordinate/junior liens must be re-subordinated to the new first mortgage.

Can I “roll up” my closing costs with a HARP refinance?

Yes, mortgage balances can be increased to cover closing costs in addition to other monies due at closing such as escrow reserves, accrued daily interest, and a small amount of cash. In no cases may loan sizes exceed the local conforming loan limits, however.

I am unemployed and without income. Am I HARP-eligible?

No. Income verification is required for the HARP refinance program.

My original mortgage was a stated income loan. Will my income be verified with a HARP refinance?

Yes, with HARP, applicant income is verified in the same manner as with a traditional refinance — via a combination of W-2s, paystubs, tax returns and other, underwriter-requested documentation.

Do HARP refinances use Loan-Level Pricing Adjustments?

Technically, loan-level pricing adjustments (adjustments made to fees for a certain rate. The more risk, the more fees you’ll have to pay.) do not apply to HARP refinances, but borrowers may be subject to LLPAs based on their respective credit scores or home-types (e.g.; 2-unit, 3-unit, 4-unit). Loan-to-Value LLPAs are reduced and/or waived.

Is there a minimum credit score to use the HARP program?

No, there is no minimum credit score requirement with the HARP refi program, per se. However, you must qualify for the mortgage based on traditional underwriting standards.

Do I have to refinance my mortgage with my current lender?

In most cases, no. You can do a HARP refinance with any lender you want. Click here for a HARP rate quote from me.

What does the term “DU Refi Plus” mean?

“DU Refi Plus” is the brand name Fannie Mae assigned to its particular flavor of the HARP program. “DU” stands for Desktop Underwriter. It’s a software program that simulates mortgage underwriting. “Refi Plus” is a gimmicky-sounding term that could have been anything. The name has been trademarked, however. As an aside, Freddie Mac is using the branded name “Relief Refinance”.

Can I remove my spouse or a co-signer with a HARP refinance?

Maybe. HARP guidelines specifically prohibit removing a co-signer from the note, but there are circumstances in which you can remove a co-signer from the mortgage and from the deed so that the former co-signer has no ownership interest in the home.

For how long should I lock my mortgage rate via the HARP Program?

Lock for 45 days, at minimum. This is because the HARP program, while streamlined for simplicity, still has some grey areas that can lead to delay. It’s better to have a rate lock that lasts too long than not long enough.

When does the HARP program end?

If you are HARP-eligible, you must close on your mortgage prior to January 1, 2014 — 798 days from now.

How do I apply for the HARP program?

Go to my site to get a rate quote. If the rate looks good, you can accept it. There is no fee for applying.

Apply For Home Affordable Refinance Program

Lastly, don’t forget! The Home Affordable Refinance Program is not meant to save a home from foreclosure. It’s meant to give underwater homeowners a chance to refinance without paying PMI. If you need foreclosure help, call your current loan servicer immediately.

Good Luck!

Important Note: Fannie Mae and Freddie Mac are scheduled to provide full details of the program, including information to lenders, by Nov. 15. The FHFA says some lenders may be able to start offering the program by Dec. 1, although most estimates are of a rollout in the first quarter of 2012 for most participating lenders. Chase Bank and mortgage lender Genworth have already indicated they look forward to participating.

IPCs provide an incentive for a borrower to purchase a particular property, and in certain real estate markets, IPCs may be used to artificially inflate or maintain the sales price of a property. Fannie Mae has established definitive terms for what constitutes an IPC, specific limits on the use and permissible amounts of IPCs, and how IPCs in excess of permissible limits must be treated. These guidelines are designed to help avoid practices that may distort or artificially inflate the market value of properties.

Convetional Conforming Limits

• If you are buying a home as investment property or rental, the maximum contribution allowed by and interested-party is 2% of the sales price
• If you are buying a home as your primary residence there is a little more flexibility. At 9.99% down or less the maximum contribution is 3%. Put 10% to 24.99% down the maximum contribution by an interested-party is 5%. Lastly any more than 25% down and the interested party can contribute 9%.

VA Home Loans

• VA is a 4% limitation towards prepaids, discount points and other sales concessions (such as debt payoff).  On a VA, the seller can pay unlimited closing costs (appraisal, title, recording, loan fee, etc). There are also certain fees the Veteran isn’t allowed to pay, be sure to check with your lender on current guidelines. It’s important to note VA home loans are for primary residences only.

FHA Home Loans

• FHA still allows for an IPC of 6% regardless of the down payment. It’s important to note FHA loans are for primary residences only.

USDA Home Loans

• USDA still allows for an IPC of 6% regardless of the down payment. It’s important to note FHA loans are for primary residences only.

When IPCs exceed these limits they are considered sales concessions. For underwriting and eligibility purposes, the lender must make a downward adjustment to the property’s sales price to reflect the amount of any contributions that exceed the maximum limits. The maximum LTV/CLTV ratios must then be calculated using the lesser of the reduced sales price or appraised value.When IPCs exceed these limits they are considered sales concessions.

Excerpts from the article:

By Dr. Steve Sjuggerud
Wednesday, June 1, 2011

Now is literally the best time in recorded history to buy a house in America…

Right now – today – U.S. real estate is the most affordable it’s ever been. Ever.

When I say “affordable,” I’m looking at three things: house prices, mortgage rates, and incomes. With the Affordability Index near 200, the median family has 200% of the income necessary to buy the median home (or more specifically, to qualify for a conventional loan on the median home).

Right now, as you know, house prices are sitting near new lows for this cycle, down by roughly one-third (depending on who’s counting). And right now, mortgage rates – after ticking above 5% earlier this year – are all the way down to 4.5% again, near all-time lows.

So it’s simple: With the worst house-price crash in American history, combined with the lowest mortgage rates in history, you can now afford more home than ever. Meanwhile, hope is gone. Everyone thinks housing is hopeless. That is when a bear market ends and a new bull market begins.

At a conference I attended last month, some speakers spoke woefully of the large supply of houses for sale. That will take care of itself in time. Others bemoaned the certainty of higher interest rates in the future, which would hurt housing. But they shouldn’t be so certain…

Twenty years ago, Japan faced a housing bust similar to ours. Japan’s government has cut interest rates to near zero and printed money. And long-term interest rates in Japan currently sit around 1%. Even rising interest rates won’t kill housing… In the 1970s, interest rates were rising, and house prices outperformed stock prices.

The story is simple: House prices have fallen more than ever… And mortgage rates are lower than ever. If you can buy a house now (and want one), go for it.

Now is the best time in American history to do it.

Good investing,

Steve
http://www.dailywealth.com

One side effect of that policy had been to stifle purchase-and-renovate projects by legitimate, small-scale investors who buy houses after foreclosure or loan defaults and then resell them in substantially improved condition. In many parts of the country, first-time and moderate-income buyers often sought to buy these fixed-up houses using FHA-insured mortgages with 3.5% down payments, but were prevented from doing so by the “anti-flipping” rule.

This left large numbers of foreclosed, vacant houses sitting unsold and deteriorating, with negative effects on the values of neighboring properties.

Last January, FHA Commissioner David H. Stevens announced a one-year suspension of that rule, permitting qualified buyers to obtain FHA mortgages on properties that were acquired by rehabbers less than 90 days before. The plan, set to expire at the end of this month, came with safeguards for purchasers, including inspections and multiple appraisals in some cases to document the amounts spent by investors on the improvements.

Vicki Bott, deputy assistant secretary for single-family housing at the FHA, confirmed in an interview that the agency expects to continue the policy for another year. Not only have first-time buyers responded overwhelmingly to the opportunity to buy “turnkey” renovated homes with low down payments, she said, but they have performed well on their mortgage obligations.

“Obviously we have concerns about flipping in general,” Bott said, but the FHA has seen none of the fraud problems, defaults and re-foreclosures that cost the agency millions in insurance payouts in earlier years.

Investor Paul Wylie, who with a group of partners and contractors specializes in acquiring, renovating and reselling foreclosed and distressed houses in the Los Angeles area, says the government’s policy “has been a very positive approach” because “it recognizes the role that [private investors] can play in helping the housing market get back on its feet.”

In the L.A. market, Wylie said, FHA financing accounts for 40% of all home purchases and 60% of purchases in predominantly Latino and African American communities.

Buying foreclosed houses “comes with a lot of risk factors,” Wylie said. “There’s no title insurance. We don’t have a good idea of the extent of the defects” inside properties that have been sitting vacant or vandalized for months. Some houses come with delinquent property taxes, which Wylie’s group typically must pay.

Then again, the profit opportunities can be significant as well. Most of the Wylie group’s houses sell for more than 20% higher prices than Wylie paid at acquisition — a quick turnaround gain that potentially works for buyers, sellers, neighborhoods and, yes, the FHA itself.

Source:  www.latimes.com

What is the Mortgage Payment Assistance Program (MPA)?
Mortgage Payment Assistance is the first OHSI program. It will help at least 5,000 Oregon homeowners pay their mortgages for up to one year, or offer $20,000, whichever comes first. It is the largest of OHSI’s programs, funded at $100,000,000.

How can I apply for Mortgage Payment Assistance?
The application for Mortgage Payment Assistance will be available on December 10, 2010 at www.oregonhomeownerhelp.org. Further details about the application process will be available in December.

How long do I have to apply?
Beginning December 10, 2010, homeowners will have one month to apply for the MPA program.

Will homeowners who receive Mortgage Payment Assistance have to pay it back?
It depends. Mortgage Payment Assistance payments will be five-year, forgivable, interest free, non-recourse loans. OHSI will defer all payments and forgive 20 percent of the balance each year.

If a homeowner who gets Mortgage Payment Assistance sells their home or refinances the home within five years, the homeowner may have to repay some of the assistance.

Will every struggling homeowner in Oregon get help from OHSI?
No. There are tens of thousands of homeowners who need help in Oregon. The program cannot serve everyone who needs help.

How will the state choose who gets help paying their mortgages?
Oregon’s housing crisis is hurting thousands of homeowners. Oregon has enough money to help about 5,000 homeowners through its MPA program. That means many more homeowners need help with their mortgages than the program can serve.

The state will conduct a random drawing to choose who will get help. The program is not first come, first serve. The state will accept applications over several weeks so all eligible homeowners have a chance. All eligible applications will be in the drawing.

How do I know if I’m eligible for Mortgage Payment Assistance?
You can take a simple test to find out if you may be eligible on www.oregonhomeownerhelp.org.

I am delinquent on my mortgage. Am I still eligible for Mortgage Payment Assistance?
Yes.

I am not behind on my mortgage. Am I still eligible for Mortgage Payment Assistance?
Yes.

Are small business owners eligible for this program?
Yes.

Do I have to be unemployed to be eligible for Mortgage Payment Assistance?
No.

What about the other OHSI programs?
Other OHSI programs will launch early next year. Details about the application process and eligibility will appear on this site soon.

What can I do right now to apply for Mortgage Payment Assistance?
The application will be available on December 10, 2010. Visit www.oregonhomeownerhelp.org to learn more and to sign up for updates.

Mortgage Payment Program Eligibility Criteria

Qualifications

• The household’s income cannot be equal to or more than 120 percent of state median income (see chart at bottom of page for details). A homeowner who has an Oregon bond loan meets this test.
• The homeowner’s current first mortgage must date before January 1, 2009.
  The homeowner must have a verifiable loss in income of 25 percent or more (due to unemployment or underemployment).
• The homeowner cannot have more than four months of mortgage payments available as liquid assets. (Retirement and education savings accounts are OK).
• The homeowner must complete and sign a Financial Hardship Affidavit.

• The homeowner, in connection with a mortgage or real estate transaction, cannot have been convicted, within the last 10 years, of any one of the following: (A) felony larceny, theft, fraud or forgery, (B) money laundering or (C) tax evasion.

Property

• The subject property must be an owner-occupied, primary residence and be located in Oregon. Manufactured homes are eligible only if the structure is recorded in the county’s deed records. *Note: Condominiums and Town homes are NOT considered single-family, 1-unit, detached homes.

• No more than two years’ property tax may be unpaid on the subject property.

Exclusions

• The homeowner’s unpaid mortgage balance cannot exceed $729,750.
• Homeowners who have received notification of trustee/sheriff sale before February 1, 2010 are ineligible for the MPA program.
•  Homeowners who own other residential real property are ineligible for the MPA program.
• Homeowners who are currently in active bankruptcy are ineligible for the MPA program.
• Any homeowner who knowingly submits more than one application for the MPA program

The economy’s improving but lending standards are not. Nationally, banks are making mortgage approvals harder to come by.

Underwriting guidelines are tightening.

The data comes from the Federal Reserve’s quarterly survey to its member banks.  The Fed asks senior bank loan officers around the country to report on “prime” residential mortgage guidelines over the most recent 3 months and whether they’ve tightened.

For the period October-December 2009:

• Roughly 1 in 4 banks said guidelines tightened
• Roughly 3 in 4 banks said guidelines were “basically unchanged”

Just 2 of 53 banks said its guidelines had loosened.

Combine the Fed’s survey with recent underwriting updates from the FHA and generally tougher standards for conventional loans and it’s clear that lenders are much more cautious about their loans than they were, say, in 2007.

Today’s home buyers and would-be refinancers face a bevy of new borrowing hurdles including:

• Higher minimum FICO scores
• Larger downpayment requirements for purchases
• Larger equity positions for refinances
• Lower debt-to-income ratios

So, if you’re on the fence about whether now is a good time to buy a home, or make that refi, consider acting sooner rather than later.  It doesn’t necessarily matter that mortgage rates are low, or that there’s an up-to-$8,000 home purchase tax credit for households that qualify.  With each passing quarter, fewer and fewer applicants are eligible to take advantage.