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Responsible homeowners seek refinance help!

My wife and I currently live in the Chicago suburbs. The purchase price of our home was 411k in April 2008. In early 2011 we refinanced to the rate of 5.875%. During this refinance our home was appraised less than our purchase price at a value of about 305k. With the new record low rates, I have attempted to undergo another refinance. I looked into the HARP program however one of the requirements is that the mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009. Because of my refinance in 2011, I'm no longer eligible for this program. Our current loan is a Freddie Mac. My wife and I have excellent FICO scores (upper 700's). We owe approximately $365K on the home. We are not experiencing financial hardship with a total annual income of approximately 170k per year. We are seeking to take advantage of the low mortgage rates offered today. With an underwater home and high mortgage rates, it's frustrating that there seems to be no program offered for responsible home owners. by clambi_642_954 from Chicago, Illinois. Aug 28th 2012 Reply


Patrick McCarthy (PatrickM)
#23 ranked lender in Ohio - 196 contributions

Hello.Sadly, the thinking behind the HARP guidelines are that folks that are taking out loans after the housing crash, do so at their own risk. It appears you have already used the HARP loan guidelines in 2011. That being said, there is a way you can negotiate better terms with your current lender/servicer. It involves finding tortious or fraudulent activity with the current mortgage loan/appraisal and using that as leverage to negotiate better loan terms. Most lenders have ironed out the issues prior to 2011, so you may not have much success with this, but there are thousands of folks having success getting principal reductions and payment modifications using this strategy. If you want a professional loan auditor's contact info, I can refer one to you. He is in Wash, DC and is an atty. Email me for his contact info.

Aug 28th 2012
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Travis Torcoletti (travis.torcoletti)
#0 ranked lender in South Carolina - 372 contributions

The HARP program is for responsible homeowners however you refinanced last year so you are ineligible for that reason. Unless a new HARP program comes out for those in your situation then you are sadly stuck in an underwater home.

Aug 28th 2012
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Peter Botros (PeterBotros)
#70 ranked lender in New York - 895 contributions

Unfortunately, there are no current loan options for you. The only thing that may be of interest is to pay down your principal and then refinance to a very low rate. Best Of Luck!

Aug 28th 2012
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William J Acres (William_Acres)
#73 ranked lender in Arizona - 8,728 contributions

The HARP program was intended for responsible home owners, since you wouldn't have been able to refinance under the program before when you were nearly $100K underwater.. But the program guidelines were as clear then as they are now.. You only get to use the program once.. One and done!! And I wouldn't anticipate any program in the future to help your scenario, since all the programs tend to target "Prior to June, 2009" as the qualifying date. You could pay down your mortgage to 80% Loan to Value ($292,000). It's a huge chunk of cash to lay out, but you would have significant payment savings.. If you go 15 years, even lower interest rate, you would still have a lower payment than your 30 year mtg payment.. Since values are on the rise, it's not a bad financial strategy.. I'm a Broker here in Scottsdale AZ and I only lend in Arizona. If you or someone you know is looking for financing options, feel free to contact me or pass along my information. 480-287-5714 WilliamAcres.com

Aug 28th 2012
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Linda Wintersteen (Linda123)
#62 ranked lender in Arizona - 1,256 contributions

exactly, until a new program comes out.. its really difficult... if you want , send me your address and I will do a complete property analysis , to check you value linda yourloanpartnerforlife@live.com

Aug 28th 2012
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Michelle Curtis Loan Originator NMLS 401173 (MichelleCurtisLO)
#77 ranked lender in Florida - 2,245 contributions

Sorry there is not a program out there to help you at the moment.

Aug 28th 2012
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Barb Lanis (BarbLanis)
#69 ranked lender in Illinois - 679 contributions

I am an Illinois lender in the Chicago suburbs. Hang in there for a little while. There has been some "chatter" that the HARP may be expanded. It doesn't seem that it will happen anytime soon, but the complaints are that there are many borrowers just like you. With a 365K mortgage, that's a big payment that could go down significantly if you could refinance. I would recommend that you keep an eye on local sales and as soon as there is some movement that would support a higher appraised value, then that would be the time to try the refi again. Also, 2011 was pretty brutal in terms of values in certain pockets of Chicagoland. Have you looked around to see if there have been more recent sales in your neighborhood?I'm very familiar with most of the suburbs and would be pleased to see if I can help you, whether now or in the future. b.lanis@comcast.net 630-660-8868

Aug 28th 2012
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Phil Dumouchel (PhilDu)
#32 ranked lender in South Carolina - 2,249 contributions

Unfortunately there is a one time option to use the HARP option and now that your loan is owned by Freddie Mac they have the same June 2009 deadline - so your new mortgage does not qualify. The only option I can think of that might make sense for you would be to pay the balance of the mortgage down to less than 95-97% of the current appraised value. That would allow you to refinance but the new loan would have PMI (Mortgage insurance). While that isn't desirable because your rate is so much higher than is currently available it still might be a benefit to you. One idea that others have used is to borrow from their 401k (so that you are paying yourself back) to make this step possible. Otherwise, at the moment there really aren't any other refinance options for you.

Aug 29th 2012
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