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erikdjs
08-18-2010, 2:19 PM
Since mortgage interest rates are ridiculously low, I thought I'd offer my services here. Please keep in mind that I specialize mainly in FHA type loans.

Also, I just built a blog that will offer daily rates to anyone that's interested.

http://dailyratedude.wordpress.com

Here's an excerpt from the "About" section:

So hereís the deal. Iíve been a mortgage agent, loan officer, mortgage broker, etc, etc, whatever you want to call it Ė for the last 6 years....

My Guarantee: Iíll tell it like it is. Good news or bad, you have the right to know your loan status immediately so you can make plans accordingly. I hate when vendors hide things from me and Iím sure you do also.

PM's or call with any questions. Thanks!

dly123
08-19-2010, 7:11 PM
I'm guessing you can't refi an upside-down home?

erikdjs
08-19-2010, 8:11 PM
Hi Dly123,

FHA recently unveiled a short-refinance program which will allow the refinance of upside down homes.

Here are the eligibility requirements:

Existing loan to be refinanced is not FHA insured;
Must owe more on their mortgage than the value of the property;
Must be current on the existing mortgage to be refinanced;
Must have a “FICO based” decision credit score greater than or equal to 500;
Existing first lien holder must write off at least 10% of the unpaid principal balance (UPB);
Loan-to-value (LTV) ratio of no more than 97.75%;
Combined loan-to-value (CLTV) ratio must be 115% or less; and
For manually underwritten loans, the qualifying ratios can be no greater than 31/50

Here's the catch: even though FHA will finance the new loan, your current lender(s) must agree to settle the difference. They are being offered incentives to do this - but it's still their call. The experience for the homeowner will be similar to the negotiation of a short-sale.

Basically, it's doable BUT there is no guarantee expressed or implied AND you should consider it a swing for the fence and have a backup plan available.

Here's my source:HUD - FHA Short Refinance Program (http://portal.hud.gov/portal/page/portal/HUD/press/press_releases_media_advisories/2010/HUDNo.10-173)

dly123
08-19-2010, 8:50 PM
That FHA program sounds great, but this home has sank like the titanic. We are talking 175-200% LTV.

erikdjs
08-19-2010, 9:40 PM
@Dly, responded to your PM.

_______________________________________
Please keep in mind that this program is brand spanking new so there's no evidence of this being successful for anyone. It may be another failed program like Hope For Homeowners. Or it could be the best thing since the 1911.

Here are some things to consider.

Short Refinances are not new. In fact, if a borrower could fit the previous FHA guidelines they could get financed into a new loan. The problem was (and probably still will be) getting the current lender(s) to sign off on the difference. Supposedly there is now an incentive for the current lenders to write off the difference, but I don't know exactly what it is.

The other issue is that in order to get financed, the borrower still must qualify for the new loan - all while demonstrating a hardship to the current lender in order to write-off the balance. How do you show that you're having a hard time paying your mortgage if it's current? Perhaps if your other bills besides the mortgage are defaulted, but who knows if that would really work. It's like a catch 22.

Only time will tell if this program is successful. I just want to be candid with everyone and not get people's hopes up.

Believe me, I'll be looking more into the program in the morning and also give a call to HUD to see what they say.

erikdjs
08-26-2010, 8:44 AM
Just a quick update for those that were interested in the FHA program.

I called HUD on Tuesday and left a message requesting more information on how exactly this program is to be handled. No news yet, but I'll update here as soon as I have word.