The Updated Home Refinance Program

Although the Federal Housing Finance Agency, with Fannie Mae and Freddie Mac (the Enterprises), announced changes today to the Home Affordable Refinance Program (HARP) it hasn’t yet been implemented.  Many refer to this as “The Obama Refinance Program.”

The guidelines for this program, including implementation dates and details, will be available on November 15, 2011.  Just because they will be available on November 15th does not meet the banks will implement it right away and they rarely ever do because they will institute their own set of guidelines.

This loan will only be available if you have a Fannie Mae or Freddie Mac loan.  Some of the changes include:

  • Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers;
  • Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac;
  • Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac;
  • Eliminating the need for a new property appraisal where there is a reliable AVM (automated valuation model) estimate provided by the Enterprises; and
  • Extending the end date for HARP until Dec. 31, 2013 for loans originally sold to the Enterprises on or before May 31, 2009.

You can read the FHFA New Release and as more information comes available I will be sure to share it with you.