HARP Refinancing | Real Estate Short Sales

On Zillow,?Justin McHood said that more than once this week, he have had someone ask : ?Are HARP refinancing really happening, or is it just something that I see on the news that isn?t real??

So I thought it might be timely to point out that although many people are currently frustrated while trying to refinance under the Home Affordable Refinance Program, many homeowners are successfully refinancing their mortgages through the initiative.

HARP 2.0 statistics

Recently, the Federal Housing Finance Agency released information on the number of HARP refinancing that are happening, and although the program may not be perfect, homeowners who were previously unable to refinance have been able to do so through HARP 2.0.

Some interesting statistics from the report:

• HARP loans represented 20% of total refinance volume in May, the largest increase since HARP was first launched.
• During the first five months of this year, more than 78,000 refinances were completed, more than the total number of HARP refinances during all of 2011.
• Underwater borrowers represented more than half of HARP volume in Nevada and Arizona, and 40 to 50% of HARP refinances in Florida, Idaho and California.

Homeowner frustrations

Under the expanded HARP 2.0 guidelines, the program is a great option for underwater borrowers with loans backed by Fannie Mae or Freddie Mac. That doesn?t mean, however, that you should expect your refinancing experience to be without problems?? quite the opposite.

Due to the large volume of people who are interested in HARP and the relatively few lenders who are participating, many borrowers become upset with the process at some point along the way. The top three complaints: long turn times, guideline differences among lenders and a general lack of expertise from loan officers.

Remember: If one lender cannot help you with a HARP loan, shop for a different lender.

Not all lenders are participating in HARP?? and among the lenders that are participating, not all of them have the same guidelines. The large banks still account for the majority of the volume, and it isn?t uncommon for someone who wants to refinance through HARP to be told it will take 90 days to close the loan.

The verdict?

Long turn times, confusing information about the program and frustration around every corner. ?Does that mean HARP 2.0 is not working?

No.

It is working better than ever before?? just expect to put more work into the process than you have in the past when doing a traditional refinance.

read more on Foxnews

The Million Dollar Question. If you are upside down more than $50,000 upside down, not getting a principle reduction then why would you do a loan modification or refinance your mortgage low just to reduce your payment when it could take you over 21 years to break even? ask Manny Caballero, Broker/Investor in Arizona.

I was talking to a lady the other day and she was upside down$ 250,000, or 199% Loan to Value, and still wanted to do a refinance without a principle reduction.? Her bank was too happy to help.

What will happen is she decided to sell her home for any reason in say, 3 years from now, do you think her home would be worth about the same as today?

I would say, yes is still $250,000 upside down but now she would have another problems beside asking the bank to accept a short sale. She would owe the IRS taxes, up to $60,000 in taxes. As far as we know today the Mortgage Debt Relief Act is going to expire in 2012.? If this nice lady sold her HAFA qualified loan, she would not owe the balance on her mortgage to her lender, she would probably not owe the IRS a penny and if she had enough down-payment could by the bigger home next door saving your more per month than the refinance she did.

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Source: http://realestateshortsales.com/harp-refinancing/

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