What is the Harp Refinance Program?

May 10, 2012 By Leave a Comment

Recently this early spring the HARP 2.0 refinance program much improved on the old HARP 1.0 refinance program which is very exciting news.  So what is HARP?  HARP is a program to allow borrowers with Fannie Mae and Freddie Mac owned mortgages to refinance into today’s record low 30 year fixed mortgage rates.  The key with this program is it allows borrowers who have high loan-to-value mortgages or may be significantly upside down on their mortgages to still refinance into today’s rock bottom 30 year fixed rates.   Here are some basics about who qualifies for the HARP program:

  • The borrower’s loan must be owned by Freddie Mac or Fannie Mae.
  • The borrower must have closed on the loan on or before May 31 2009
  • The loan cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
  • The current loan-to-value (LTV) of the mortgage must be greater than 80%.
  • The borrower must be current on the loan at the time of the refinance, with no late payment in the past six months and no more than one late payment in the past 12 months.

 

One of the really terrific aspects of HARP refinance 2.0 is there is no maximum loan-to-value if your property is owner occupied.  If you owe a lot more than your property is worth, you can still take advantage of this HARP loan program.

 

To qualify for the HARP refinance program, you still have to provide you income documentation and a credit check has to be done.  However the debt-to-income ratio requirements are pretty lenient.  The first step is to call us and we can check to see if your mortgage is owned by Fannie Mae or Freddie Mac.   So don’t hesitate to call if you have any questions, 858-922-7899 or homeloan8@gmail.com

 

Regards,

Rob Chomentowski

Sr. Loan Officer

Affinity Financial

858-922-7899

Homeloan8@gmail.com

10% Down Conventional Loan With PMI A Great Option

May 4, 2012 By Leave a Comment

If you are looking for a medium down payment loan, one of the best options out there is a 10% down conventional loan with private mortgage insurance (PMI).  If you can swing the 10% down and have a decent credit score, this is a better option than getting an FHA loan.  The main reason 10% down conventional is so much better than FHA, is there is much lower mortgage insurance associated with the loan.

What is PMI?  PMI is private mortgage insurance.   Any time you put less than 20% down on a home purchase you are going to need some type of mortgage insurance.  This is required to insure the lender against default and protect them against loss.  Obviously the chance of the lender experiencing a loss if the borrow defaults is much higher with 5% or 10% down vs. 20% down.

Again 10% down conventional is better than FHA because there is less mortgage insurance.  With a 10% down conventional loan you can have as low as a .44% PMI cost per month.  Compare this with FHA which is 1.75% up front MI and a 1.25% monthly MI.  Wow isn’t that a huge difference!  The FHA up front MI is rolled into the loan balance and calculated on the loan balance.  So if you have a $300,000 loan, the FHA up front MI is going to be $5,250, making you new loan balance $305,250.  And you monthly MI is going to be $312/mo.  Where with 10% down conventional you have NO upfront MI and your monthly MI is only $110/mo.  So as you can see 10% down conventional is a better way to go if you can do it.

Conventional loans generally have more strict underwriting policies regarding credit score sand debt-to-income ratios.  Not everyone can qualify for a conventional loan.  This is why some borrowers only option is to go the FHA route.  5% down conventional is also a good option, but the monthly mortgage insurance will be higher than 10% down, about .67% for good credit borrowers.

I hope this article helps you understand PMI better and informs you of the benefits of a 10% conventional loan.  I think this is the “sweet spot” with lending today.  Don’t hesitate to call me at 858-922-7899 or email me at homeloan8@gmail.com if you have any questions.

The conventional loan limits go all the way up to $625,000 in much of California including Los Angeles, Orange County, San Francisco, San Jose and most of the Bay Area.  San Diego conventional loan limits go to $546,250.

Regards,

Rob Chomentowski

Sr. Loan Officer

Affinity Financial

858-922-7899

Homeloan8@gmail.com

Jumbo Loans Available in California

May 1, 2012 By Leave a Comment

There are currently some excellent options for jumbo home loans in California available right now that not commonly know.   What is a jumbo loan in California?  A jumbo loan is a loan amount over the conventional loan limit in California.  Below are the conventional loan limits in some selected counties in California: San Francisco: $625,500 [...]

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10% Down Jumbo Loan In California

January 27, 2012 By Leave a Comment

There is an excellent special 10% down jumbo loan we available all over the state of California.  Below are the loan limits for this jumbo loan mortgage in California: Bay Area (San Jose, San Francisco, East Bay) : $875,000 max loan amount ($972,000 purchase price) Los Angeles, Orange County: $875,000 max loan amount ($972,000 purchase [...]

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FHA Loans for the Self Employed

January 19, 2012 By Leave a Comment

FHA Loan Requirements for Self Employed Borrowers Getting a FHA loan in California for self employed borrowers can be much trickier than w-2 borrowers.  FHA lenders will take the NET income off your last two years tax returns and average that to calculate your income to qualify for a FHA home loan.  If your income [...]

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VA Loans after being Unemployed

January 19, 2012 By Leave a Comment

Get A VA Loan In California After Being Unemployed Many potential VA eligible home buyers and home owners that want to refinance may have been unemployed for long periods of time during the current economic times.  The good news is that VA home loan requirements only require you to back on the job for a [...]

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