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Best HARP 2.0 Rates Best HARP 2.0 Rates(3)

Best HARP 2.0 Rates

One of the top questions from homeowner’s these days seems to be, “What lender can get me the best HARP 2.0 rates on my refinance?”, but this question should actually be second to the most important factor:  “What lender can even do my HARP refinance?”.  Unlike most standardized mortgage programs we’ve all come to know, there are many factors that will determine which lenders can complete your transaction.  There are also different “pricing hits” for various aspects of your scenario which are important to know before you start your search for the best HARP 2.0 rates.  In this piece we’ll be focusing on how to best educate yourself on the potential  pricing hits:

Best HARP 2.0 Rates – Loan Level Hits to Watch for:

Though we’d all like to get our hands on the best HARP 2.0 rates, its important to know what the various “big banks” who will ultimately service these loans view as additional risk factors.  The most common loan-level price adjuster is LTV(Loan-to-Value).   There are also loan level hits for credit score, property type, and occupancy type (owner-occupied, investment property, etc.).  Lets first focus on the most common:  LTV pricing hit:

Best HARP 2.0 Rates – Price add-on’s for LTV:

Now while this new version of HARP is not supposed to limit the LTV, there are only a select few banks willing to accept any loans over 125% LTV.  In regard to pricing hits specifically, the best HARP 2.0 rates can be obtained with the lowest LTV.  For example if your home is at 80%-85% LTV, there shouldn’t be much of a pricing hit at all.  However, once you exceed the higher LTV thresholds such as 90%, 95%, 105%, and especially the 125% LTV, now you should expect to pay about .25% higher in rate, depending on the lender.  A good rule of thumb when looking for the best Harp 2.0 rates is to first ask the lender if they have the ability to complete your transaction based on your expected LTV, and second, what the pricing hit will be for your expected LTV.

During your search for the best HARP 2.0 rates, the first question should be, “can this lend actually do this deal given my property’s current LTV?” 

Best HARP 2.0 Rats – Pricing Hits Fee Structure for Credit Score and Property Type:

Other aspects to consider when searching for the best HARP 2.0 rates is credit score and property type.  As you would probably expect, with less than perfect credit comes a bit higher rate.  There are usually very little hits if you’re at 680+ but typically there will be a small hit once you get below 660.  Additionally, there is a hit for property type.  Specifically, condominiums usually come with about .125% hit to rate (75bps to price) if the LTV is over 75%.  This is an industry-wide Fannie Mae hit so plan on getting this bit higher rate if you own a condo and are over 75% LTV.

As you can see, there isn’t a one-size-fits-all rate/price for this program and its important to take all aspects into consideration when in search of the best HARP 2.0 rates.

Author Joe Karns is sales and marketing leader and master of getting you the best HARP 2.0 rates, 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 Best HARP 2.0 Rates.

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.

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