What’s everyone HARPing about?
For those of you who have been tuned into the news about what’s new to help struggling homeowners, you may have heard a lot about HARP 2.0 and the new changes that would make it a viable alternative for struggling homeowners. While many are shouting the great news, most are just more confused about what HARP is and if it can help them. So this article is meant to help clear up any confusion and give you the straight scoop about whether HARP is the right alternative for you.
First, HARP stands for Home Affordable Refinance Program, and it is completely different from HAMP which stands for Home Affordable Modification Program. A modification is a change to the terms of the loan you currently have, but a refinance is putting a brand new loan into place that pays off the existing loan. And right now, HARP is strictly for loans that are Fannie Mae or Freddie Mac government sponsored loans. To find out if you have a Fannie or Freddie loan, click here to look up your loan. If you do not have a Fannie or Freddie loan, skip the next paragraph and continue reading. If you do have a Fannie or Freddie loan, congratulations. Keep reading.
For those of you with Fannie and Freddie loans, the changes to HARP that make it a more viable alternative to help struggling homeowners are great news! With these changes, you can be very upside down and still qualify, where before you could only be slightly upside down. HARP allows you to refinance your existing loan to current interest rates without concern that you owe considerably more on the property than it is currently worth. But because this is a refinance, there is a cost to the process. The costs will vary depending on the mortgage company you apply with, and you are not required to apply with the company that currently services your loan.
Whether or not you qualify for HARP, you should also consider if it is really the right alternative for you. Both HAMP and HARP do nothing to address the situation that you still owe more on your home than it is currently worth. For most families, that value discrepancy will continue to rob them of the benefit of their home being an investment that is building equity for their future for many years to come.
There are strategic alternatives that do address the upside down value situation in a comprehensive way. To discuss those options, give me a call and we’ll schedule a confidential complimentary consultation. Please keep in mind that these options do have protections in place for you that are set to expire at the end of 2012, so it is important to learn about your options now while they still offer you safe solutions.
Regards,
Janice Spencer with Guaranteed Results Team
Buy Another Home After a Short Sale – Part One
Did you know that now it is possible to purchase another home immediately after completing a short sale of your current home under certain circumstances? The FHA has a loan program to assist distressed Sellers to purchase a replacement home depending on the circumstances. Here are a few of the guidelines:
- You can not have any late payments in the last twelve months on the mortgage of the home you are attempting to short sale. This means that the investor guidelines on your current loan allow for approving a short sale even though you are current on your payments.
- You can not be trying to short sale your current home just to take advantage of the down market. In other words, you can’t short sale your current home of 2000 square feet to buy another home that is 2000 square feet at a price that is $200,000 less than what you owe on your current property.
- You must meet minimum credit score requirement.
If you want to know if this program may be just what you need to move you into a better ownership position, give me a call or send me an email and we’ll talk. And if you know of anyone who may need assistance with figuring out what their options are to avoid foreclosure or strategically improve their ownership position, please let me know so that I can get them important information while they still have time to choose.
Warmly,
Janice Spencer
