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June 25, 2012

Underwater Homeowners Refinancing with HARP

Category: Financial News,Home Refinance Tips – admin – 10:23 am

American homeowners continue to seek refinancing solutions from the new HARP refinance and the streamline program, but will this help the housing crisis disappear? A recent report issued by the Federal Reserve indicates that U.S. households lost 38.8% of their wealth between 2007 and 2010, the largest drop since 1989. Although the Federal Reserve indicates the losses in financial assets and businesses as contributing to diminished net worth, the central banker targets declining house prices as the primary cause.

The bleak housing news comes as no surprise to borrowers that have been struggling to refinance their underwater loans. One of the few positive opportunities in this era of housing woes is that homeowners are starting taking advantage of the Obama’s foreclosure prevention programs, including the Home Affordable Refinance Program. This is a government relief measure that is sponsored by Fannie Mae and Freddie Mac.

FHA and HARP Refinancing Look to Help Struggling Homeowners

The recently revamped HARP 2.0 enables homeowners to refinance without regard for current home value, which enables qualified “underwater” homeowners refinance to today’s low mortgage rates. According to the Mortgage Bankers Association, the HARP refinances are soaring in popularity.

Meanwhile, he Federal Housing Administration doesn’t want its’ customers to be left out with underwater mortgages so they too have eased their guidelines on the streamline program. The FHA streamline loan program now features reduced upfront mortgage insurance premiums for homeowners that choose to refinance their existing FHA home loans that were originated prior to June 1, 2009.  If you are a homeowner that has been unable to refinance because your home loans are “underwater”, then consider the Streamline or HARP refinance because they may provide the best option to reduce your interest rate and monthly housing payments.

Take a minute and get a free loan quote from lenders that will uncover your refinancing eligibilities today.


August 26, 2010

Credit Qualifications for Home Mortgages

Over 30% of US Consumers Do Not Qualify for Home Loans

Since the subprime home loan market crashed in 2006, lenders and banks have been tightening loan guidelines for refinance a purchase mortgages.

  • Credit scores need to be higher
  • Income needs to be greater
  • More equity is needed to refinance
  • More money is required for down-payments

Government loan products like the FHA and VA loan have emerged as the most flexible mortgage for borrowers who are struggling to qualify for a refinance loan. The FHA and VA streamline refinance have helped a lot of American homeowners refinance in a pinch. The FHA streamline does not allow borrowers to finance closing costs in the loan, so borrowers typically have to come out of pocket for lending costs like appraisal, title and escrow.

According to research from Deutsche Bank, the number of consumers in the United States with credit scores below 600 has increased to 26 percent from only 15 percent prior to the start of the recession.  This increase in bad credit scores could be attributed to late mortgage payments, credit card debt settlement or a bankruptcy.  Examining credit data further reveals that 9 percent of all U.S. consumers have a credit score in the 600-649 range.  Today most conventional and jumbo mortgage loan products require credit scores of at least 680.

Based on current loan guidelines and the credit score requirements for a home loan approval, any applicant with a score below 600 is almost certain to be turned down by a banking institution.  Borrowers in the 600-649 range are also considered “weak” candidates with a high turn down rate, especially if the credit score is below 620.

Based on the total number of Americans with a credit score of 649 or lower, up to 35 percent of all Americans are effectively locked out of the refinance or purchase mortgage market for the foreseeable future.  With foreclosures and default rates constantly increasing, it is conceivable that credit standards could be tightened even further by lending institutions.


June 7, 2010

Home Refinancing Tips

Mortgage Refinancing Buzz posted another article offering home refinance advice to consumers shopping for a refinance loan online.  The article looks back a few years to the mortgage crisis and chronologically leads up to 2010 and the lowest refinance rates that our country has seen in 50-years.  They reminded us how we got here with thousands of lending companies and banks going out of business and the federal government deciding to take on a larger role in home loans.  Yes mortgage lenders continue to tightened refinance guidelines because foreclosures and loan defaults continue to mount across the country.  Mortgage Refinancing Buzz noted that a few of the with government loan programs continue to take risks.   Mortgage refinancing tips are available online so go to the MRB blog to get the insight.  Read the original article > Mortgage Refinancing Advice for 2010


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