HARP Loan Program Guideline Update for Fannie Mae Owned Mortgages in Florida
Many Orlando Florida area home owners are frustrated by national and Florida mortgage companies over the HARP program. They are disappointed because they can’t refinance under President Obama’s Home Affordable Refinance Program. If you currently owe more on your home mortgage than the value of your home then you need to read this. Don’t get frustrated and waste your time calling and responding to mortgage solicitations, etc.
Brief facts on HARP loan program qualifications in Florida:
- Regardless of your servicer/mortgage lender (i.e. SunTrust Mortgage, Bank of America, Nationstar Mortgage, Wells Fargo, Chase Mortgage, Citi Mortgage, Green tree, Ocwen, Seterus), your mortgage has to be owned by Fannie Mae and have to have been sold to Fannie Mae by the originating mortgage company prior to June 1st 2009.
- The HARP loan program should help with one of the following:
- Reduce your interest rate
- Replace an existing adjustable rate mortgage
- Reduce your current principal and interest mortgage payment
- Reduce the term of your current mortgage.
- Most lenders will limit you to 15, 20, 25, or 30 year mortgage terms on the new refinance transaction under the HARP program.
- The loan must receive an Approve/Eligible finding from DU which is Fannie Mae’s automated underwriting system that all mortgage lenders use.
- Most lenders require a minimum credit score of 580, although there are some mortgage companies that have no minimum credit score requirements. However, if your credit score is less than 660, chances are you will have a hard time getting Fannie Mae to repurchase your mortgage loan.
- Even if your loan is owned by Fannie Mae prior to June 1st, 2009 and your credit meets the qualification, you still need to have the income ratio to qualify for the new HARP refinance loan. Most of the time if your debt-to-income-ratio exceeds 55% of your income, you will not qualify for refinancing under the HARP program.
- Your new HARP loan cannot exceed $417,000 in most Florida counties. So, if you currently have a Jumbo loan you are not eligible for the HARP refinancing program in Florida.
- If you currently have mortgage insurance, be aware that the new HARP refinance will extend your mortgage insurance payments based on the new home value determined by Fannie Mae’s automated valuation model. This criteria overrides your current mortgage insurance elimination date.
- Most lenders will not allow you to have more than one 30 day late payment on your mortgage in the last 12 months prior to your new HARP mortgage refinancing.
- If you have experienced bankruptcy in the past 48 months you are most likely ineligible for refinancing under the HARP program in Florida.
- If you have had a foreclosure you may need to wait at least 84 months prior to becoming eligible for a HARP loan.
- Reverse mortgages, Second mortgage and Government mortgage such as FHA loans are not eligible under the Fannie Mae HARP loan refinance program.
- You do not need to pay for an appraisal, so long as Fannie Mae’s automated underwriting system provides the mortgage lender with an appraisal waiver code. In some cases you will have to pay for an appraisal regardless of the value of your home.
- If you currently escrow your tax and insurance, Fannie Mae forces you to keep your escrow on the new HARP loan.
- You cannot receive more than $250 cash back from the HARP refinance transaction. In other words, you cannot request to receive cash to pay off other bills nor do home improvement from a HARP refinance loan.
- You cannot combine your first and second mortgage into one loan under the HARP program. Only first mortgage liens are eligible Under the HARP program in Florida.
As you can see there are many restrictions that prohibit a Florida home owner from taking advantage of today’s low mortgage rates in Florida. Often your best bet for getting the best HARP loan is going through a local Florida mortgage broker that has access to various lenders, charges no application fee for determining your eligibility and gets you the lowest HARP loan rates.
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