California HARP Lender: 888-409-4881

Sacramento HARP Refinancing Process

HARP_Refinance_Process

With the new HARP 2.0 updates to the Home Affordable Refinance Program, the process of refinancing your California home loan through HARP follows the same steps as a traditional conventional mortgage refi.

The major difference is that many of the previous barriers, such as transferring mortgage insurance or ordering an appraisal have either been streamlined or waived.

In addition to clearing much of the red tape, the new HARP Refinance process allows borrowers to switch mortgage companies and shop for better interest rates with less fees.


Outline: How To Refinance With HARP

The following steps outline the entire process for closing a new HARP Refinance. Simply click on the link for a detailed explanation of each step.

Step 1) Check To See If Your Loan Is With Fannie Mae or Freddie Mac

The first step in determining that your Sacramento mortgage is eligible for a HARP Refi is to check with both Fannie Mae or Freddie Mac.

If you are fairly sure that your loan is with either Fannie or Freddie, and cannot find your loan on either loan lookup tool, please feel free to call us directly at for assistance.

You may also want to double check the accuracy of the address or name you entered. In some instances, a “St.” vs “Street” could produce the wrong result.

Step 2) Submit Pre-Application And Start The Refinance Process

An application is a relatively simple form that includes your name, phone, date of birth, social security number, address, current payments and any any initial asset information you feel comfortable sharing up front.

*Depending on whether your loan is with Fannie or Freddie, the Loan-to-Value, your credit scores and income, we may need to get a more detailed list of assets or other liabilities.

You have the option of filling out a quick pre-qual form online on our HARP Quick-Apply Form, or simply call our office at 888-409-4881 to speak with a qualified HARP specialist who can take down the basic information over the phone.

Step 3) Run Credit And Initial Loan Approval

Once we have received a full application and authorization to pull credit, we will upload your secure application to the appropriate lender submission portal online in order to get the initial findings and approval from Fannie Mae or Freddie Mac

This report will tell us whether or not we need to clarify anything within your application or credit report, as well as give us a list of the documentation we need to submit to the bank with the complete loan package.

These findings will also produce an estimated value, which will determine if an appraisal will be required as well.

Since the appraisal requirements are changing on a weekly basis as this program evolves, we ask for your patience and understanding if we end up having to order an appraisal half-way through the refinance process.

However, on the hand, we may be able to obtain an appraisal waiver half-way through the refinance process as well if the lender guidelines change in our favor.

Either way, we will keep the lines of communication open with you at all times so that you do not have any surprises.

Step 4) Sign Disclosures And Collect Borrower Documentation

The initial refinance application is called a 1003, (ten o three), and it consists of several pages that include a Good Faith Estimate, Truth In Lending disclosure and a few other papers that describe your rights as a borrower.

All applicants will need to sign and date this 1003, which can be done in our office or via fax / mail at your convenience.

The documentation that we may need from the borrower, depending on initial approval findings:

a) Current Payment Coupon For First & Second Mortgage

b) Hazard Insurance Dec Page, Or Phone Number Of Property Insurance Agent

c) Two Month’s Pay Stubs

d) Two Year’s W2’s and/or Tax Returns

e) Two Month’s Complete Bank Statements

f) Social Security / Pension Reward Letters

g) Documentation Of Child Support

h) Letters Of Explanation For Special Circumstances

Step 5) Submit Complete Borrower Refinance Package To Underwriting

You will just has to worry about signing the disclosures, 1003 and providing updated income/asset documentation.

Behind the scenes, we will be ordering payoffs, a preliminary title report and a few other important pieces to the puzzle.

In the case where you have a second mortgage that needs to be subordinated, we may need your participation in this process. It really depends on who the second lien holder is and what they require as far as up-front subordination fees or signatures.

You may be required to submit a processing fee to the second lien holder to obtain the subordination. The fee for this can be several hundred dollars.

*An important side-note with the subordination – If you have a second HELOC (Home Equity Line Of Credit) that is not maxed, your bank may put a temporary or permanent freeze on your available line of credit until the HARP Refinance is complete.

Again, keeping open lines of communication will help all of us avoid any unnecessary speed bumps or surprises along the way.

Step 6) Sit On Pins And Needles For Several Weeks

There has been a flood of new HARP Refinance applications submitted to participating HARP lenders, which means that processing and underwriting turn-times have gone from 24 hours to 3-4 weeks in some cases.

While the banks work with Fannie and Freddie to improve the process, we have to be prepared for longer waiting periods.

The good news is that the initial findings in “Step 3” above will give us an actual approval to be confident in. So, as long as the documentation provided by the borrower and collected by the lender match those initial Fannie Mae of Freddie Mac findings, it’s really just a simple matter of going through the systems.

Bottom line, with the millions of underwater homeowners that this program is anticipated to help, banks or loan officers should not be desperate to tell everyone that they are approved. Since these refinances to take a considerable amount of time and energy to process and fund, I would hope that participating HARP lenders would have the professional courtesy to give borrowers honest feedback and opinions about their potential approval.

However, if you feel at any time that your current lender / loan officer is not giving you accurate information about the status of your refinance application, please feel free to call us directly at 888-409-4881 to discuss your scenario.

The Obama Administration, our mortgage industry and the Sacramento real estate market is counting on this HARP Refinance Program to be successful. So if there are under qualified or dishonest mortgage operations giving this program a bad reputation, several state and federal officials would be highly motivated to weed them out of the industry.

Step 7) Bank Approval And Doc Conditions

Things start to move quickly again at this point in the HARP refinance process.

The lender will issue a final approval with a small list of conditions that need to be satisfied prior to ordering loan documents.

Updated pay stubs, any additional letters of explanations, corrections to the title policy… and the list can go on.

However, if “Step 5” above was done properly, this final “Lock and Doc” step should be quick and painless.

Locking in an interest rate is generally done at this time as well since many lenders will require full bank approval before they’ll tie up funds in a lock.

A rule-of-thumb with locking mortgage rates is that the shorter the lock period (15 -30 days), the lower the rate. Additionally, rate lock extensions tend to get quite expensive.

Either way, experienced lenders understand how rates move and what the market is doing that may have a positive or negative impact on rates at any given moment. So, as long as your loan officer has demonstrated that they know a thing or two about mortgage rates, you should feel confident that they are looking out for your best intest.

Another point to consider about interest rate locks for your peace-of-mind is that loan officer compensation cannot be tied to higher or lower rates. By law, loan originators have to charge the same rate to everyone, regardless if they are doing a loan for their family or a past client. So essentially, the government has leveled the playing field for rate shopping forcing mortgage professionals to compete based on providing excellent service, value and communication.

Step 8) Sign Docs And Record New Loan

Final documents are ordered and signed by the borrower at a number of places that may include a title or escrow company, with a mobile notary or at an attorney’s office.

Your lender will schedule this final process at your convenience while carefully paying attention to the dates on the final docs to make sure they fund in the proper month to avoid any additional charges to the borrower.

After a 3 day right of recision, your new loan will fund and record. (*NOTE. If the loan being refinanced is for a second home or investment property, there will be no waiting period.)

Congratulations!!

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.

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