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Changes to HARP

Posted on | January 17, 2012 | No Comments

The guidelines for Home Affordable Refinance Program (HARP) have been expanded to (hopefully) include even more homeowners.

  • Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers;
  • Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac;
  • Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac;
  • Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the Enterprises
  • Extending the end date for HARP until Dec. 31, 2013 for loans originally sold to the Enterprises on or before May 31, 2009.
    The details were disclosed in this press release.

It appears that Bank of America has already implemented the new guidelines. From the Bank of America website:

If you are interested in learning more about the Home Affordable Refinance Program, please call 1.800.669.6607. At Bank of America, we are committed to making government and proprietary home loan assistance solutions available as quickly as possible. As a reminder, if you are experiencing a financial hardship or are struggling to make your mortgage payments, please contact us right away at 1.800.669.6607. The sooner we understand your situation, the sooner we can explore all of the options that may be available to you.

I have two concerns:

  • Does it have to be your primary residence?  I think this includes loans on rental properties.  Check with your mortgage servicing company.
  • What about Private Mortgage Insurance (PMI)?  I hate paying it every month.  Before I commit to new loan terms I want to know when (either date or loan balance) I will no longer be required to pay it.
  • I’ve read they are getting tons of requests to refinance!


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