Posts tagged as: refinance back to homepage

When It Pays To Refinance Your Mortgage — Literally When It Pays To Refinance Your Mortgage — LiterallyComments Off on When It Pays To Refinance Your Mortgage — Literally

To refinance a mortgage means to pay off your existing loan and replace it with a new one.

There are many reasons why homeowners opt to refinance, from obtaining a lower interest rate, to shortening the term of the loan, to switching mortgage loan types, to tapping into home equity.

Each has its considerations.

Lower Your Mortgage Rate
Among the best reasons to refinance is to get access to lower mortgage rates. There is no “rule of thumb” that says how far rates should drop for a refinance to be sensible. Compare your closing costs to your monthly savings, and determine whether the math makes sense for your situation.

Shorten Your Loan Term
Refinancing your 30-year fixed rate mortgage to a 20-year fixed rate or a 15-year fixed rate is a sensible way to reduce your long-term mortgage costs, and to own your home sooner. As a bonus, with mortgage rates currently near all-time lows, an increase to your monthly payment from a shorter loan term may be negligible.

Convert ARM To Fixed Rate Mortgage
Homeowners with adjustable-rate mortgages may want the comfort of a fixed-rate payment. Mortgage rates for fixed-rate mortgages are often higher than for comparable ARMs so be prepared to pay more to your lender each month.

Access Equity For Projects, Debts, Or Other Reasons
Called a “cash out” refinance, Arlington, VA homeowners can sometimes use home equity to retire debts, pay for renovations, or use for other purposes including education costs and retirement. Lenders place restrictions on loans of this type.

A refinanced home loan can help you reach specific financial goals or just put extra cash in your pocket each month — just make sure that there’s a clear benefit to you. Paying large closing costs for small monthly savings or negligible long-term benefit should be avoided.

Many lenders offer low- or no-closing costs options for refinancing. Be sure to ask about it.

Harp 2.0 – Making Home Affordable Refinance Program – Valiant Enough Effort? Harp 2.0 – Making Home Affordable Refinance Program – Valiant Enough Effort?(2)

Making Home Affordable Refinance Program

Many homeowners have been inquiring about how the new “Making Home Affordable Refinance Program”, also known as “HARP 2.0”, can benefit them.  So what can Making Home Affordable do for you?  In short, this newer version improves on the initial HARP program by removing the 125% LTV limitation.  However, there don’t seem to be any of the “big banks” who are servicing the majority of the country’s existing mortgages stepping up and actually adopting these new capabilities, unless that is, you already have your loan with them.

Making Home Affordable Refinance Program – Who gets access and it enough?

There are a few key requirements to qualify for the Making Home Affordable Refinance program.  First, your loan must currently be insured by by Fannie or Freddie and it must have been insured by them on or before 5/31/09.  Next, you must still qualify, though with somewhat looser guidelines, for this transaction just like any refinance.  Every lender is different and has come up with their own interpretation and “credit overlays” on what the government has set as the bar.  This is outlined in the next section:

Making Home Affordable Refinance – The Big Banks Credit Overlays:

Just when we thought the Government was doing some real good and stepped up with this more aggressive refinance program, we now have to deal with the stubborn “big banks” who are refusing to also take similar necessary measures to help the regular folks in this time of need.  Specifically, the “big banks” profit wildly by servicing the millions of loans that they do.  To help keep as many customer in their camp as possible, the big banks are refusing to allow you the choice of shopping around for the best deal on your HARP refinance by restricting the “unlimited LTV” capability to their one bank.  In a plain terms example:  under the Bank of America Making Home Affordable Refinance program, you can only enjoy the unlimited LTV feature of the program if you stay with Bank of America.  What does this do?  This means they can charge whatever rate they want and as long as its a bit lower than what you have now, you’ll probably accept it.  This completely takes away the competitive “open market” mentality that makes shopping for any type of lower rate work.  Similarly, if you’re with Wells Fargo, you can only enjoy the full benefits of the new program if you stay with Wells Fargo.  The same goes for Chase customers, PNC, etc.

When you compare mortgage rates for a “Making Home Affordable refinance”, the first question should be, can this lend actually do this deal given my property’s current LTV?  Don’t wast your time.  Ask if they have LTV restrictions first, and then get into the rate talks.

Making Home Affordable Refinance: What does this show us about Government help/intervention?

I’m sure there will be many homeowners who take advantage of the newer Making Home Affordable Refinance program, but with all of the “big banks” credit overlays, is this real help, or just a way for the banks to further increase their profits with all this fan fair and retain customers?  Only time will tell, but I think it will take the Government stepping in to force the big banks to really open things up for this to have any widespread benefit.

Author Joe Karns is sales and marketing leader and master of the Making Home Affordable Refinance, is dedicated to bringing his subscribers relevant and useful information. Want a free mortgage checkup? Check out Joe Karns at the following link for more a FREE refinance consultation and expert advice on finding the Best Refinance Lenders. Or, click here for a free quote on Making Home Affordable Refinance.

HARP 2.0 Mortgage Program – What are the benefits of the program? HARP 2.0 Mortgage Program – What are the benefits of the program?(3)

HARP 2.0 – What are the

benefits of the program?

Everyone we know seems to be talking about the new “HARP 2.0” program which is the newest edition of government-sponsored mortgage relief.  So what can HARP 2.0 do for you?  In short, this newer version improves on the initial HARP program by removing the 125% LTV limitation.  In plain terms, many folks who couldn’t qualify for the first edition of HARP because their homes are horribly under water would qualify now.  Other new features of HARP 2.0 include reduced pricing hits at these higher LTV’s for shorter term loans (15yr fixed) and transferable PMI, but the key enhancement of HARP 2.0 is definitely the no-limit LTV.

HARP 2.0 – Tip#1:  How to know if you qualify:

There are a few key requirements to qualify for the HARP 2.0 program.  First, to qualify for HARP 2.0, your mortgage must currently be insured by Fannie Mae(DU Refi Plus) or Freddie Mac( known as “Open Access”).  Next, you need to have been making your mortgage payments on time to qualify for HARP 2.0.  Finally, the loan had to close on or before May 31, 2009.  One additional requirement for HARP 2.0 is that you cannot have already refinanced using the original HARP.

HARP 2.0 – Tip#2: Relaxed underwriting guidelines.

One additional benefit of the HARP 2.0 refinance program is the somewhat relaxed underwriting guidelines.  Specifically, the guidelines related to late mortgage payments on your existing loan.  Under the new HARP 2.0 program, you can actually have paid your existing mortgage late one time within the last 12 months, as long as the late payment occurred more than six months ago.

When you compare mortgage rates for a HARP 2.0 refinance, the most important factor is  talking to a lender that is an expert in the HARP 2.0 guidelines.

HARP 2.0 – Tip#3: What does this mean to the industry?

One thing is for sure, this new HARP 2.0 program should definitely help kick-start the mortgage industry a bit while also helping many homeowners enjoy month savings that come with historically low interest rates who otherwise would not be eligible to refinance.  While there will likely still be millions of homeowners still left high and dry, this updated version of HARP looks like it will help some folks who need relief the most:  those who are seriously upside-down on their mortgage.

Author Joe Karns is sales and marketing leader and master of the HARP 2.0 is dedicated to bringing his subscribers relevant and useful information. Want a free mortgage checkup? Check out Joe Karns at the following link for more a FREE refinance consultation and expert advice on finding the Best Refinance Lenders. Or, click here for a free quote on a  HARP 2.0.

Fill out my online form.

Contacts and information

Most Popular Articles
VA Streamline | IRRRL | VA Streamline Refinance Loan
Compare Mortgage Rates the Smart Way
VA Streamline Refinance Rates - How to Get the Best Deal
Best Refinance Lenders - How to Find the Pros

Hot Rates, Clear Terms, Cool Savings

Social networks

Most popular categories

© 2012 HotRateQuote.com theme by Joe Design All rights reserved. Compare Mortgage Rates Lower Interest Rate