Refinance in NC – New HARP 2.0 Guidelines

As part of the efforts of the Federal Reserve and the US Treasury Department to keep the US Economy from going into a full Depression, stimulus packages are being put in place to help First Time Home Buyers – and those homeowners who are currently underwater in their home.  The HARP 2.0 Refinance Program was designed to help those homeowners who want to refinance to lower rates, but don’t have the equity required by most Banks.  The HARP 2.0 refinance program guidelines are being updated – to help even more homeowners increase the cash they can keep each month (as opposed to paying really high mortgage payments).

The problem, for most folks, was that Real Estate Value across the country declined, however Banks still expected homeowners to refinance only when they had a certain percentage of Equity in the home.  Many homeowners who once had TONS of equity in their home found that they didn’t have enough equity in their home to qualify for a “traditional” refinance.  Because of that, Fannie Mae and Freddie Mac will offer the NEXT phase of the refinance program, called HARP 2.0 later this month… and best of all, the program will be offered by many more mortgage companies (like ours) , so you can be sure you get the best rate and the best closing cost scenario available!

With the NEW HARP 2.0 refinance program, you might be able to refinance even if you owe more on your home than it’s worth!  The program allows for loan to value ratios over 125% – and in some cases, the program requires NO appraisal. Although we are generally required to do Employment Verifications in North Carolina, as part of our Predatory Lending Laws, with the HARP 2.0 refinance program, we might not require us to verify your income!

The expanded version of the HARP 2.0 refinance program for North Carolina means that “UnderWater” Home Owners will be able to “skip” a house payment, and lower your house payment with the lower interest rate!  Yeah!

The HARP 2.0 refinance loan is designed by Fannie and Freddie for homes that have little or no equity.  Unfortunately, if you’ve already refinanced, the program will not work for you.  Additionally, you need to have closed on your home by May 31, 2009. 

There were pockets of North Carolina that saw tremendous gains in Property Values during the Boom.  Frankly most of that growth was near the Coast – but other parts of the State of North Carolina were impacted too. See what’s happened to home prices since the peak in real estate prices in Charlotte as an example!

As a North Carolina Homeowner (who purchased prior to June 1, 2009) you will need to do some checking to see who currently “owns” your mortgage.  To qualify for the “No Appraisal” Refinance HARP 2.0 Loan Program your mortgage must be owned by Fannie Mae or Freddie Mac.  You need to do a HARP 2.0 Eligibility Loan Search on the Fannie and Freddie site to see who has your mortgage. If it’s NOT owned by Fannie or Freddie, unfortunately, you don’t qualify for HARP 2.0 refinance. (follow our link to Fannie Mae and Freddie Mac to see if you qualify).

I cant tell you how many folks don’t know what kind of mortgage loan they currently have.  So, if your loan is NOT a Fannie or Freddie Loan available for the Home Owner Refinance Program ( HARP 2.0 loan), check out the guidelines for these other streamline programs:

USDA Streamline Refinance Program:  The Automated Underwriting System for this program needs to be updated for this program, and it’s delayed the full release of it until later in March of 2012.

FHA Streamline Refinance Program:  An ongoing program that continues to get “tweaks.”  NOTE FHA is going to raise the rates on FHA PMI effective April 1, 2012 (you can also refinance an FHA loan, even if you no longer live in the house as your primary residence!)

VA Streamline Refinance Program:  This is an ongoing program that actually had the “PMI” portion of the loan reduced, as part of an effort to make certain Veteran’s can afford their house payments!

No matter what kind of refinance you are considering, our advice is to make sure you stay current on your North Carolina Home Loan.  All of these programs require at least the last 6 months of payments be on time, and no more than 1 thirty day delinquencies in months 7-12.  Most banks that we sell loans to, however, will not make a North Carolina Home Loan of any kind if you’ve been past due during the past 12 months.  Bottom line – if you have late payments in the past year then the  HARP 2.0 Refinance may not be the right program for you.

Most of the refinance programs available right now are “reduced” document loans.  There are still documents we need, however, like the HUD-1 from the lat time you either refinanced the home, or when you bought it.  We will also need a recent pay-stub, and a copy of your mortgage statement (bill).

Want to find out if you qualify for the HARP 2.0 Refinance Program?  Contact us Today!  Steve and Eleanor Thorne, 919 649 5058.  We offer today’s best mortgage rates!