Fannie Mae and Freddie Mac' s Home Affordable Refi enhancements will be released in phases with the first version of HARP 2.0 becoming available tomorrow, December 1, 2011.  The next phases will allow for expanded loan to value requirements and pricing enhancements. Fannie Mae will have an update to their selling guide in mid-December (so more information to follow).  Freddie Mac and Fannie Mae plan on having their underwriting system (DU and LP) updated on or before mid-March 2012. I will continue to keep you posted as we learn more information.

Here's my recommendation for Washington area home owners who may be eligible for a Home Affordable Refinance:

• You can apply for HARP 2.0 tomorrow, December 1, 2011.  
• We should be able to determine whether your loan qualifies based on the current "phase" available.  We are able to re-run your scenario during the next phase of HARP, if needed.
• Loan to values under 80% may not qualify for the new Home Affordable program but you may still be able to take advantage of today's lower rates. 
• Some of my refinance clients have already had their appraisals waived with their Fannie-to-Fannie DU Plus refinances. 
• Unless you have an owner occupied or second home and are opting for an amortized mortgage of 20 years or less, the pricing difference with HARP 2.0 may not be that significant.
• I'm happy to provide you with a Home Affordable Refi rate quote.

Here are some pointers on what you can do to prepare for your Home Affordable Refinance. 

I'm still waiting to hear from all of the private mortgage insurance companies to see if and how they will participate in this program.  We are also waiting to see how the lenders and banks we work with are going to treat this and if they've added layers of overlays to this program.  

UPDATE 12/15/11: If you qualify for a HARP refinance and have borrower paid private mortgage insurance, as long as the insurance can be transferred, we can help you. Lenders (secondary markets) and private mortgage insurance companies are working on allowing this for lpmi (lender paid mortgage insurance). More info on LPMI to follow. 

I am required to have the language below if I am soliciting your Home Affordable Refi for your home in Washington…and yes, I would love to help you with your HARP (or any) refinance:

Freddie Mac and Fannie Mae have adopted changes to the Home Affordable Refinance program (HARP) and you may be eligible to take advantages of these changes.  If your mortgage is owned or guaranteed by either Freddie Mac or Fannie Mae, you may be eligible to refinance your mortgage under the enhanced and expanded provisions of HARP. You can determine whether your mortgage is owned by either Freddie Mac or Fannie Mae by checking the following websites: www.freddiemac.com/mymortgage or http://www.fanniemae.com/loanlookup/

If you have any questions about this or any mortgage program and your property is located in Washington state, I'm happy to help you.  I am only licensed to originate mortgages in Washington state.

Bottom line: we are still receiving (and waiting to receive) more information about the HARP 2.0 enhancements and bank/lender overlays.  However you can start your application on December 1, 2011 and "float" your rate, if needed.

We've been waiting to see what the "new Obama refi program" would be and this morning, the Federal Housing Finance Agency published a news release announcing new changes with the goal of reaching more borrowers. Home Affordable refinances are available to home owners who have a mortgage that is securitized by Fannie Mae or Freddie Mac on or before May 31, 2009. 

Here are some of the changes that are being made to HARP:

• Removing the 125% loan to value ceiling for fixed rate mortgages. If refinancing into an adjustable rate mortgage there is a 105% cap.
• Eliminating the appraisal where there is reliable AVM estimate available. Currently some Fannie Mae HARP refi's have qualified to have appraisals waived, it appears this may become more of the norm with HARP refi's.
• Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and reducing fees for other borrowers;
• Extending the end date of HARP until December 31, 2013 for loan originally sold to Fannie or Freddie on or before May 31, 2009 (note – the date a loan was sold to Fannie or Freddie is different than the date you closed on your refinance).

Borrowers must be current on their mortgage payments with no late payments in the past 6 months an do not have more than one late payment in the past 12 months.

HARP refinances are available for single family dwellings and condos as well as owner occupied, second homes and investment properties.

You DO NOT have to use your current mortgage servicer (who you currently make your mortgage payments to) for your Home Affordable Refinance unless you currently have private mortgage insurance. If your home is located anywhere in Washington State, I can help you with your mortgage needs.

If you have been turned down for a Home Affordable refinance because of a low appraised value and you otherwise qualified – this is your second chance!

More information is to be available by November 15, 2011.  Stay tuned!

UPDATE: Here are some tips for preparing for your HARP 2.0 refinance BEFORE you apply.

Update: Home Affordable Refi Program has been extended through December 2013!

Good news for home owners who have a qualified conventional mortgage where their home has depreciated in value and they want to refinance to a lower rate or more stable program, the Fannie Mae Home Affordable Refinance Program and Freddie Mac's Relief Refinance have been extended to next summer (notes dated on or before June 30, 2012). 

In addition to extending the cut off date for this program, which was scheduled to sunset this summer, Fannie Mae has expanded the loans they will consider for this program.  From their March 14, 2011 announcement:

"Currently to be eligible for Refi Plus or DU Refi Plus the existing mortgage loan being refinanced had to be purchased by Fannie Mae prior to March 1, 2009 or in an MBS pool with an issue date prior to March 1, 2009.  With these program changes, mortgage loans are now eligible if they were purchased by Fannie Mae prior to June 1, 2009 or in an MBS pool with an issue date prior to June 1, 2009….

Loans purchased by Fannie Mae between March 1, 2009 and June 1, 2009 will not recognized by Fannie's underwriting system (DU) until April 11, 2011. 

I am thrilled that Fannie is adding three months of their loans to be eligible for the HARP program which makes the qualifying dates consistant Freddie Mac's program. 

Remember, you do not have to go to your mortgage servicer (who you make your mortgage payment to) for this program…unless you have pmi.  Wouldn't it be great if some of the big banks who have been refusing to consider borrrowers with private mortgage insurance for the HARP program loosen up?  One can hope!  If you're a borrower who's been refused a Home Affordable refi by your bank due to privatate mortgage insurance, you may want to sign this petition.

Related post: 

The Home Affordable Refinance Program extended until next summer  [includes info on Fannie Mae's Home Affordable program].

Freddie Mac's Home Affordable Refinance - Refinance Relief Program

I've written about Fannie Mae's HARP program a few times here at Mortgage Porter, but I've neglected to write much about Freddie Mac's version.  This is partly due to the fact that when the Home Affordable program began, loans securitized by Freddie Mac required that you had to go back to your mortgage servicer: THIS IS NO LONGER TRUE.  In addition, Fannie Mae has a much larger market share than Freddie so I've been helping more Seattle area home owners who have lost equity with Fannie's program.   I'm pleased that Freddie Mac has expanded this program (Open Access) to not force home owners to return to the mortgage servicer which means, I can probably help you if your mortgage is owned by Freddie Mac (or Fannie Mae). 

Freddie Mac's program offers "borrowers who are current on their mortgage payments the ability to refinance to improve their financial situation when home values have declined…"   If you are behind on your Freddie Mac owned mortgage, you may qualify for the Home Affordable Modification.  I do not do loan mods.

Here's some information about Freddie Mac's Home Affordable "Relief Refinance" (if  you're mortgage is owned by Fannie Mae, click here).  Although some of these guidelines are similar to Fannie Mae, there are some differences.

In order to qualify for this program, your mortgage must be securitized (owned) by Freddie Mac prior to June 1, 2009 and be in first lien position.   To see if Freddie Mac owns your mortgage, click here.

The loan amount is limited to the mortgage balance plus the lesser of $5,000 or 4% of the current balance.  And the maximum cash back a borrower may receive is $250.   For example, if your current mortgage balance is $400,000, the most your new loan amount could be is $405,000.  You may find that you either need to bring cash in to close (typically a mortgage payment) or price the mortgage with zero points (while Congress still allows this as they're trying to ban rebate pricing). 

For King, Snohomish and Pierce counties, the maximum loan amount is $567,500 for a single family dwelling. 

This program is available for primary residences, second homes and investment properties.

If your original mortgage did not have private mortgage insurance, the new mortgage will not have private mortgage insurance even if your current loan to value is over 80%.

There must be a benefit to the borrower, such as a reduction in interest rate, replacing an adjustable rate mortgage with a fixed or a reduction in term.

Borrowers must be current on their mortgages with no "30 day late payments" in the last 12 months.

Second mortgages must be subordinated (they cannot be included or paid off with the refinance).  Most second mortgage lien holders are cooperating–but it is their call on whether or not they will permit the subordination to take place.

A full appraisal is required and loan to values up to 125% are permitted.

Income and employment are verified.  Minimum credit score is a 620.

The Home Affordable Refinance Program is scheduled to end in June 2011 2012.   If you're interested in a rate quote for your mortgage, at no obligation, to see if refinancing makes sense for your Washington state home, please contact me.

NOTE:  This post has been updated to reflect the extension of the HARP refi.