The answer is YES! The government just rolled out the new HARP loan. This program allows people with Good Credit, but no equity in their home, a chance to refinance and take advantage of these low rates!
Here's how it works: Any homeowner can take advantage of this program if they:
1. Have purchased and settled on a home before June, 2009,
2. Have a Fannie Mae (FNMA) or Freddie Mac (FHLMC) held mortgage,
3. Don't owe more than 105% of the home's value (If home is a Row or a Twin),
4. Don't owe more than 150% of the home's value if the subject property is a (Single),
5. Have not been 30 days late on any mortgage payments,
6. Have a minimum of a 660 credit score.
If you or anyone you know meets all of the above criteria, you or they can take advantage of this program.
The interest rates for this program are slightly higher than normal rates, so you need to make sure that this program will work for you.
If your loan has PMI insurance included in the monthly payment, we need to determine who the PMI insurance company is just to make sure that they are participants in this program. Participating PMI companies have special rates for these loans where their premiums won't increase over what you are currently paying on your existing mortgage.
Many of the loans acquired during the years of the peak housing prices are combination loans such as: 80/20s, 80/10/10s or 80/15/5s. As many of you know, this meant that you were given a 1st mortgage, as well as a home equity loan, in order to avoid having to pay PMI insurance. This refinance WILL NOT include the payoff of any junior liens ( Home Equity loans, Lines of Credit or 2nd Mortgages ). These secondary lenders will have to agree to Subordinate their liens. This means that they will have to allow the current 1st mortgage to get paid off with the refinance. They will have to step back into a 2nd lien position on the property, once again. Most lenders are willing to do this given the circumstances surrounding the current state of the housing market.
This loan offers a chance for someone, who were told they can't take advantage of these low rates, to refinance their mortgage and either reduce their monthly payment, or reduce the remaining term of their loan. You can't borrow any additional money to do any repairs or consolidate bills. This program is only for those looking to get a better interest rate. Closing costs can be rolled in to the mortgage to a maximum of 4% of the total loan amount. This should cover most if not all of the closing costs.
Please contact me for more details regarding the specifics of this program.
Andy Williams NMLS # 118317
Abacus Regional Mortgage NMLS # 113984
484 695 5972