It has now been a few weeks since the introduction of the HARP 2.0 program in San Diego, which allows homeowners who are upside down with their mortgage be able to refinance up to an unlimited Loan to Value if Fannie Mae or Freddie Mac own their loan.
In just the short time before the introduction of the San Diego HARP 2.0 program and the few weeks since it has been available I have been inundated with calls and emails requesting information and quotes from the past articles I have written about the HARP program. A number of these request have already turned into loan applications and are now in underwriting.
A few examples of some recent San Diego HARP 2.0 loans that I have in process are a refinance on a home at a loan to value of 190%, a refinance of a rental condo with a loan to value of 134% and a debt to income ratio of 59%, and a refinance of a condo with a combined loan to value of 145%.
There are a few new things that we have learned about the San Diego HARP 2.0 program since its release and I wanted to make you aware of them. First off, we have seen that Fannie Mae is being much more lenient than Freddie Mac with their approvals. Fannie Mae is approving rental properties at LTVs in the 125%-150% range and allowing debt to income ratios up to 60%.
Freddie Mac is not approving rental properties over 100% LTV and they are capping debt to income ratios at around 45% with some exceptions up to 50%. Freddie Mac is also denying approvals when clients have over 50% balances on their credit cards.
Second, Fannie Mae came out with new risk classifications on the San Diego HARP 2.0 program. They now have expanded approvals I, II, and III. These usually occur at the higher LTV’s, on rental properties, and higher debt to income ratios. Many lenders are deciding not to accept these loans or if they do accept them, they will carry a slightly higher rate. As a San Diego Mortgage Broker who is specializing in the San Diego HARP 2.0 Program, I do have lenders who are accepting all 3 expanded approvals.
The last thing we have learned about the San Diego HARP 2.0 loan program is that we are not receiving as many appraisal waivers as we believed we would. I have received appraisal waivers on about 50% of my files. This may change as more transactions are done.
Although, the San Diego HARP 2.0 refinance program is not exactly as we thought it would be, it is still helping a number of homeowners who are underwater. In many cases I am saving clients between $350 – $500 per month by using this program. If you have any questions concerning the San Diego Harp program or would like to receive a free quote, please feel free to contact me at 619-312-0612. I am happy to help and hopefully be able to save you thousands of dollars a year.