Freddie Mac Refinancing under Obama Plan

[Juliet25]

We had been in 'process' with WF since February. Got the approval packet and everything in the mail with the good faith estimates. Called the guy, he told us we just had to wait for an appraiser to call. the guy called yesterday and told us the underwriters changed their minds. The guy had even called and told us that we were locked in for 4%.

Geez...it seems this program does a whole lot of nothing. So, it's totally up to the lender whether or not to participate, even if you meet the guidelines? Wow, thanks for nothing!

OP, I have a Freddie backed mortgage from Chase (with PMI), but I haven't started the ball on a refi. I'm trying to find out more info on it and there just doesn't seem to be any out there.

Sorry I'm no help.

 

[djgeffers1]

Our mortgage was thru Countrywide til recently when they changed to Bank Of America. We are a month behind and when we make a payment this month we will still be a month behind. They say we do not qualify, i dont understand, how do you qualify?

 

[cay2420]

Djg - The Making Home Affordable plan is intended for those whose mortgages are current and not behind. Actually you can't have any late payments in the last 12 months. What was happening is that there were many people falling behind on their payments and the lenders were doing modifications of their loan terms. The problem was that nothing was offered for those that were paying on time. The Making Homes Affordable Plan allows those who pay on time and have high loan to value (i.e. mortgage balance $200,000, value $195,000). Under normal circumstances you would not be able to do a refinance like that. This plan allows you to do that AND you do not have to pay PMI if you currently don't have PMI. If you do have PMI, you are not eligible yet. It is unfortunate that a lot of people are being misled.

 

[Juliet25]

Djg - The Making Home Affordable plan is intended for those whose mortgages are current and not behind. Actually you can't have any late payments in the last 12 months. What was happening is that there were many people falling behind on their payments and the lenders were doing modifications of their loan terms. The problem was that nothing was offered for those that were paying on time. The Making Homes Affordable Plan allows those who pay on time and have high loan to value (i.e. mortgage balance $200,000, value $195,000). Under normal circumstances you would not be able to do a refinance like that. This plan allows you to do that AND you do not have to pay PMI if you currently don't have PMI. If you do have PMI, you are not eligible yet. It is unfortunate that a lot of people are being misled.

So, if I'm reading this right, mortgages with PMI aren't eligible at this time to refi, but they will be in the future? Or mortgages with PMI just aren't eligible period?

 

[LovinPooh]

Really stinks for us. This refi could have done great things for us. We have never been late on our mortgage, just have a bad mortgage right now with a high interest rate. We dont konw what to do now. DH wants to just do nothing. Doesnt want another hit on his credit. So frustrating!!!!

 

[dzneprincess]

Cay if I understand you correctly if my current lender does not participate even if qualified then we can go to another service ie boa and still do the refinance? How does that work?

 

[PrincessMommy2]

Actually, The Making Home Affordable refinance plan does not allow you to delinquent. However, under the modification portion of the plan, you can be current or delinquent. djgeffers1, we also have our loan with Countrywide (now Bank of America). It is frustrating trying to deal with them to say the least. Were you trying to refinance or modify the loan? A previous poster mentioned NACA. They are a non-profit HUD approved counseling agency that will negotiate with Bank of America on your behalf to restructure your loan so that you can afford it. From what I have read on the forums at loansafe.org, NACA seems to get better terms than dealing with Bank of America on your own. Their services are free. Please read the forums at loansafe.org, there are many success stories of people who have worked with NACA. That is what we are in the process of doing, just could not deal with Bank of America anymore, the left hand does not seem to know what the right hand is doing.

Good luck to you and if you have any questions, please feel free to PM me.

 

[Saltines]

We just recieved a Home Afforable Modification. We have Fannie Mae and are behind (2 months) and have PMI insurance. Our loan is with Coldwell Banker. We saved $350.00 a month on our mortgage. I called in March and called again in April, recieved the package in May and started the new payments this month.

 

[cay2420]

We just recieved a Home Afforable Modification. We have Fannie Mae and are behind (2 months) and have PMI insurance. Our loan is with Coldwell Banker. We saved $350.00 a month on our mortgage. I called in March and called again in April, recieved the package in May and started the new payments this month.

That is great! For others reading though this is NOT part of the Making Homes Affordable plan. This is a modificationt that the lender did.

 

[cay2420]

Cay if I understand you correctly if my current lender does not participate even if qualified then we can go to another service ie boa and still do the refinance? How does that work?

Yes, that is correct. So long as all of the guidelines are met. Obviously the first thing we do is make sure it is a Fannie Mae loan and go from there. The other part of this is that we have to make sure that the loan did not originate with Lender Paid Mortgage Insurance. What this means is that at one point in time if you didn't put 20% down or do a combo loan, you would have had to pay PMI OR in lieu of a higher rate you would have lender paid mortgage insurance. The other important piece is that the program will only allow you to refinance the first mortgage up to a maximum of 105% of the homes current value.

 

[cay2420]

So, if I'm reading this right, mortgages with PMI aren't eligible at this time to refi, but they will be in the future? Or mortgages with PMI just aren't eligible period?

Correct, there will be a Phase II which is for those who currently have PMI or Lender Paid Mortgage Insurance. I don't have many details yet on this but we are rolling it out on or around June 12th.

 

[cay2420]

Really stinks for us. This refi could have done great things for us. We have never been late on our mortgage, just have a bad mortgage right now with a high interest rate. We dont konw what to do now. DH wants to just do nothing. Doesnt want another hit on his credit. So frustrating!!!!

Is this a Fannie or Freddie loan?

 

[Disneyjamie]

Yes, that is correct. So long as all of the guidelines are met. Obviously the first thing we do is make sure it is a Fannie Mae loan and go from there. The other part of this is that we have to make sure that the loan did not originate with Lender Paid Mortgage Insurance. What this means is that at one point in time if you didn't put 20% down or do a combo loan, you would have had to pay PMI OR in lieu of a higher rate you would have lender paid mortgage insurance. The other important piece is that the program will only allow you to refinance the first mortgage up to a maximum of 105% of the homes current value.

Hi Cay,

Just to also confirm from your statement, can BOA only do Fannie Mae loans from other lenders that meet the PMI/105% requirements? Or also Freddie Mac loans?

 

[cay2420]

Hi Cay,

Just to also confirm from your statement, can BOA only do Fannie Mae loans from other lenders that meet the PMI/105% requirements? Or also Freddie Mac loans?

We can only do loans right now that are with other lenders and do NOT have PMI and are under 105% on the first mortgage. In the next several weeks we will be able to do those with PMI. We CAN NOT do Freddie Mac loans with outside lenders.

 

[Disneyjamie]

Thanks Cay for the clarification on Freddie Mac loans at other lenders.

I decided just to call Chase and talk to them about refinancing under the Obama plan our loan - and they said they could do it. Why would our mortgage broker tell us otherwise??? Every month our value of the house declines, and if this could have been done sooner, I will be soooo mad at the broker. I should have went with my gut instead of trying to work with our broker.

 

[cay2420]

Thanks Cay for the clarification on Freddie Mac loans at other lenders.

I decided just to call Chase and talk to them about refinancing under the Obama plan our loan - and they said they could do it. Why would our mortgage broker tell us otherwise??? Every month our value of the house declines, and if this could have been done sooner, I will be soooo mad at the broker. I should have went with my gut instead of trying to work with our broker.

Brokers are often "correspondant lenders" and are not the same as dealing with the bank. They have certain limitations as to what they can and can't do. Note to all: When trying to do these plans you must deal directly with the lender or bank and not the broker!

 

[Disneyjamie]

Ok, my broker just called me and said that he has heard that banks are taking applications for these loans, but no one is actually closing on the loans. So he says you get the application filed with the lender, pay whatever fees are required (for Chase, its a $750 application fee), and then just sit and wait until Freddie Mac will release the details on how to close with the plan. Then you are locked in with them as you paid this fee, but nothing will be happening for a while. Don't know who to trust here (Chase or the Broker).

 

[cay2420]

Ok, my broker just called me and said that he has heard that banks are taking applications for these loans, but no one is actually closing on the loans. So he says you get the application filed with the lender, pay whatever fees are required (for Chase, its a $750 application fee), and then just sit and wait until Freddie Mac will release the details on how to close with the plan. Then you are locked in with them as you paid this fee, but nothing will be happening for a while. Don't know who to trust here (Chase or the Broker).

Well I can tell you that we are taking appliactions on them AND they are closing! Just so I have your scenario correct, your loan servicer is Chase and the investor is Freddie Mac? The only way you can do Freddie is if your loan servicer participates in the MHA program. Oh and by the way, $750 application fee is outrageous!

 

[Disneyjamie]

I have just sent emails to my congressman/senators and the White House about my displeasure with Freddie Mac loan refinancing under the MHA. I see no reason why Fannie Mae loans can be refinanced with any lender, but Freddie Mac loans can only be done with the original lender. I, the consumer, am the one losing out on this as I am stuck using Chase only (which I am not happy about at all). Maybe if enough Freddie Mac loan holders complain enough, this could get fixed.