NEW Fannie Mae Home Affordable Refinance
The goal of this new program is to allow borrowers with interest rate mortgages or loans such as interest only or short term adjustable rate mortgages to refinance to a lower fixed rate mortgage or a longer term adjustable rate mortgage.
This program allows loan to value’s up to 105% with no ceiling on subordinate (2nd trust) financing. The existing lien holder on the 2nd mortgage must agree to subordinate (remain in 2nd place) for the loan to be eligible to refinance.
This mortgage program is intended for borrowers that are current on their mortgage, have not had any late mortgage payments in the last 12 months and are not having difficulty making their current mortgage payment.
When the program was first initiated, the property could not be listed for sale and still be eligible for refinancing. This condition has been waived as of May 2, 2009.
Income
This loan is a full documentation mortgage. Employment, income and assets are verified.
Credit
There is no minimum credit score. The credit report is analyzed by an automated underwriter to determine if it is acceptable.
Benefit Test
There are two tests to determine whether or not there is a benefit to the borrower. The first test is whether or not the monthly payment is decreasing. The second test looks at the actual mortgage product. If the new loan is a more stable mortgage, it will pass the benefit test.
High Balance Loans
An existing high balance or jumbo loan may qualify for refinancing. The limits are based on the current conforming loan limits based on the area the property is located in.
Existing 2nd Mortgages
Existing 2nd mortgages may not be paid off with the new loan. This includes 2nd mortgages obtained when the home was purchased. The existing lender of the 2nd mortgage must agree to subordinate the loan for the new mortgage to be granted.
Mortgage Insurance
If the existing loan does not have mortgage insurance, the new loan will not be required to obtain it either. If the existing loan does have mortgage insurance, the new mortgage insurance rate is based on the existing rate.
Appraisals
Some mortgages may be eligible for an appraisal waiver. The only properties that qualify for this waiver are one unit properties occupied as a primary residence, second home or investment property. The fee to waive the appraisal is $75. It is the underwriter’s discretion as to whether or not the waiver is granted.
Seasoning – Time since the existing mortgage was originated
If the existing mortgage was a refinance combining a prior 1st and 2nd trust, and the refinance occurred in the past 6 months, the new mortgage will qualify for financing.
Cash Back
The borrower cannot receive more than $250 cash back at settlement.
The Home Affordable Refinance or “Refi Plus” is an excellent option for homeowners that have been unable to take advantage of today’s low rates because of declines in property values.
We are happy to help you with the new “Refi Plus” loan!
NEW Fannie Mae Home Affordable Refinance
The goal of this new program is to allow borrowers with interest rate mortgages or loans such as interest only or short term adjustable rate mortgages to refinance to a lower fixed rate mortgage or a longer term adjustable rate mortgage.
This program allows loan to value’s up to 105% with no ceiling on subordinate (2nd trust) financing. The existing lien holder on the 2nd mortgage must agree to subordinate (remain in 2nd place) for the loan to be eligible to refinance.
This mortgage program is intended for borrowers that are current on their mortgage, have not had any late mortgage payments in the last 12 months and are not having difficulty making their current mortgage payment.
When the program was first initiated, the property could not be listed for sale and still be eligible for refinancing. This condition has been waived as of May 2, 2009.
Income
This loan is a full documentation mortgage. Employment, income and assets are verified.
Credit
There is no minimum credit score. The credit report is analyzed by an automated underwriter to determine if it is acceptable.
Benefit Test
There are two tests to determine whether or not there is a benefit to the borrower. The first test is whether or not the monthly payment is decreasing. The second test looks at the actual mortgage product. If the new loan is a more stable mortgage, it will pass the benefit test.
High Balance Loans
An existing high balance or jumbo loan may qualify for refinancing. The limits are based on the current conforming loan limits based on the area the property is located in.
Existing 2nd Mortgages
Existing 2nd mortgages may not be paid off with the new loan. This includes 2nd mortgages obtained when the home was purchased. The existing lender of the 2nd mortgage must agree to subordinate the loan for the new mortgage to be granted.
Mortgage Insurance
If the existing loan does not have mortgage insurance, the new loan will not be required to obtain it either. If the existing loan does have mortgage insurance, the new mortgage insurance rate is based on the existing rate.
Appraisals
Some mortgages may be eligible for an appraisal waiver. The only properties that qualify for this waiver are one unit properties occupied as a primary residence, second home or investment property. The fee to waive the appraisal is $75. It is the underwriter’s discretion as to whether or not the waiver is granted.
Seasoning – Time since the existing mortgage was originated
If the existing mortgage was a refinance combining a prior 1st and 2nd trust, and the refinance occurred in the past 6 months, the new mortgage will qualify for financing.
Cash Back
The borrower cannot receive more than $250 cash back at settlement.
The Home Affordable Refinance or “Refi Plus” is an excellent option for homeowners that have been unable to take advantage of today’s low rates because of declines in property values.
We are happy to help you with the new “Refi Plus” loan!