California HARP Lender: 888-409-4881
If you are applying for a HARP 2.0 refinance inSacramento, the path between simply being eligible and successfully closing on a new loan could be long and disappointing if you do not ask the lender a few important questions ahead of time.
The good news is that there are plenty of qualified HARP Lenders who are willing to participate in the California Home Affordable Refinance Program.
Credit Scores, Loan-to-Value caps, property types and mortgage insurance challenges are a few potential road blocks that may prevent one lender vs another from following through with a HARP Refinance approval.
The California Home Affordable Refinance Program’s eligibility requirements outlined on the official MakingHomeAffordable.gov site are fairly straightforward and appear to actually be able to help millions of underwater homeowners as the program has stated.
However, many HARP applicants have reported a negative experience with the first or second bank that they attempted a HARP Refinance through, which is perpetuating a Too Good To Be True attitude by the public.
If you or someone you know was unsuccessful in getting their mortgage refinanced with one lender, know that HARP 2.0 could still be an option for helping you cut your monthly mortgage payment and/or interest costs.
Here is a list of questions you should ask before proceeding with the loan process on a HARP 2.0 mortgage refinance inSacramento:
While getting the right answer to all of these questions may not guarantee your success, getting the wrong answer on any of them should help you steer clear of someone that may not be able to help you.
1. Does your company have any servicing restrictions on who you can originate HARP 2.0 loans for?
Many big banks will do HARP 2.0 loans, but only for loans where the payment is still being made to them. And it is important to realize that bank tellers may not have access to your servicing information at the time that they recommend you check out the new HARP program.
Note – in many cases, even though your loan may have started with the bank where you do business, the servicing may have been sold to another company which could prevent the original lender from refinancing your loan.
Bottom line, there are lenders that will do your loan regardless of who the present servicer is.
Just make sure before you submit your application that you ask if they have any restrictions in the event your loan is serviced by another company.
2. Do you have any Loan-to-Value (LTV) caps in effect that would prevent my loan from being approved?
Some lenders are currently originating HARP 2.0 loans, but only at a maximum LTV of 105%, 125% or 150% limits.
For example, a loan amount of $125,000 with a home value of $100,000 would represent a Loan-to-Value of 125%. If your loan amount exceeded this and your lender had a cap of 125%, your loan would not be approved.
Some lenders have no LTV restrictions and if you believe your new loan would exceed 105%, you would be wise to ask in advance before proceeding if this could be a problem for you.
Note – The higher the LTV, the longer it may take to close your HARP loan due to the limited number of lenders that are funding these higher Loan-to-Value transactions. For mortgages with 150%
or greater LTV, it is not uncommon to wait 60-90 days for a full underwritten approval and final loan documents.
3. Do you have any FICO score caps in effect that could prevent my loan from being approved?
Some lenders have instituted FICO score caps for HARP 2.0 loans that may exceed their normal guidelines.
This is particularly true when the loan to value exceeds certain levels. If you know that your FICO score may fall below 720, you should ask the lender you are speaking with if they have any credit overlays involving FICO scores that could impact you.
Note – One of the updated guideline changes with HARP involves placing a ceiling on Loan Level Price Adjustments (LLPA), which would have normally disqualified a borrower from refinancing due to the higher interest rates.
4. If my mortgage has Private Mortgage Insurance in effect, will that be a problem with obtaining an approval?
Some lenders will not originate a new HARP 2.0 loan if your current mortgage has Private Mortgage Insurance (PMI) currently in place. This could be either PMI that you currently pay monthly or is paid by the lender.
Many lenders will work with you if your mortgage has PMI, just make sure you discuss this with your lender before you make application.
5. Do you have any occupancy restrictions if my property is not my primary residence?
If your property is a used as a second home or investment property, some lenders will not work with you, preferring to originate HARP 2.0 loans only for properties that are used for a Primary Residence.
6. Do you have any restrictions on property type that could prevent my loan from being approved?
Property types can be described as detached and attached single family residences, including town homes and condominiums. There are also multi-family properties including duplexes, triplexes and quadruplexes. HARP 2.0 allows for all property types to be refinanced although many lenders have restrictions that do not include all.
If you encounter an obstacle, this doesn’t mean that you cannot obtain financing, it may simply mean you have to ask the right questions to find the right lender.
In doing research for a lender that can assist you, one way is to search out local lenders online that are doing HARP 2.0 loans Open up your favorite search engine, such as Google.com, and type in “(your city) HARP Lender” to see which companies are active in your market, as well as to determine their level of education about the new program.
For example, if you live in Las Vegas, search “Las Vegas HARP Lender” for a list of local mortgage companies to start pre-qualifying.
CLICK HERE to submit a contact request online and we will have one licensed California HARP Approval Network member connect with you asap. You can also feel free to Call us directly @ 888-409-4881 for any questions about HARP loans.