If you are not behind on your mortgage payments, but are unable to refinance to take advantage of today?s lower mortgage rates because the value of your home has declined, you may be eligible to refinance through Sovereign Bank?s Home Affordable Refinance Program.
This program is designed to help borrowers whose home loans are owned by Fannie Mae or Freddie Mac refinance into a more affordable mortgage loan. But, how do you know whether your loan is owned or has been securitized by Fannie Mae or Freddie Mac?
It is a piece of cake ? both Fannie Mae and Freddie Mac have established online lookup tools and toll-free telephone numbers to make the information available. No matter which method you use, what you need to do is just to offer required information such as street address, city, state and zip code.
? For Fannie Mae: 1-800-7FANNIE (8am to 8pm ET)
http://www.fanniemae.com/loanlookup/
? For Freddie Mac: 1-800-FREDDIE (8am to 8pm ET)
https://ww3.freddiemac.com/corporate/
However, be noted that this is not the only qualifying criterion for the Home Affordable Refinance Program eligibility. There are also other qualifying requirements that must be met.
In fact, the Home Affordable Refinance Program (also known as HARP) is a U.S. federal program, offered through eligible mortgage servicers, such as Sovereign Bank. This means you have to meet the requirements set by the government, although you get through a mortgage servicer. Here is a general idea of government requirements.
? Your mortgage was acquired by Fannie Mae or Freddie Mac on or before May 1, 2009
? The current loan-to-value ratio of your property must be no less than 80%
? You haven?t refinanced your mortgage through the HARP, unless it is a Fannie Mae loan that was refinanced under HARP during March-May 2009
? You are current on your mortgage payments, with no 30-day late payments in the last 6 months and no more than one late payment in the last 12 months
While the government set the requirements on the program, there may be additional criteria imposed by the mortgage servicer. Additionally, some requirements may also differ in details. For instance, to qualify for a Home Affordable Refinance Program from Sovereign Bank, you need to meet the following criteria:
? You own a one to four-unit home
? You are current on your mortgage payments (within the past 12 months, you have not been more than 30 days late on any of your payments)
? You believe that the amount due on your first mortgage is the same or less than the current value of your property (Actually, your first mortgage loan needs to be less than 105% of the current market value of your property)
Speaking of the current value of your property, it will be determined after you apply to refinance. For your convenience, you can contact a Sovereign Mortgage Development Officer to speak about refinancing options. Just take advantage of Find Sovereign Advisor and you can search for a Sovereign advisor near you by selecting the type of advisor and entering the desired location.
http://www.sovereignbank.com/personal/advisor_locator/default.asp?ref=mort&sou=mkhaffordable
You can also choose to submit a Pre-Qualification form to determine if you are eligible. To get a written pre-qualification from Sovereign Bank, speak with a mortgage representative at 877-729-4801 or complete an online pre-qualification application.
Sovereign Mortgage Pre-Qualification Application
https://www.sovereignbank.com/personal/forms/mortgage_pre_qual.asp
When you are ready to apply, be sure to be prepared to offer the following personal and property information.
Personal Information:
? Home address for the last 2 years
? Social Security Number
? Employment information for the last 2 years, including employer name, address and phone number
? Income information, including salary, overtime, commissions, bonuses, interest, dividends, pension and any other source of continuing income
? Bank accounts, including bank name, account number and type
? Other assets, including automobiles owned, retirement accounts and bonds
? Liabilities, including creditor names, outstanding balances and monthly payments for all debts such as alimony and child support
? Real estate owned, including property address, market value, outstanding liens, rental income, mortgage payments, taxes, insurance and association dues
Property Information:
? Year property was acquired
? Original cost of home
? Cost of improvements (if applicable)
? Amount of outstanding liens
Anyway, whatever the mortgage servicer, if you are considering refinancing your mortgage through the federal government?s Home Affordable Refinance Program, here are some common questions you might be interested in.
Will the HARP lower your payments?
You know, the FARP is actually created to help creditworthy borrowers who are looking to get into a mortgage loan with payments that are affordable today and sustainable for the life of the loan.
If your mortgage interest rates are much higher than the current market rates, you can expect an immediate reduction in your payments through the program. If you refinance from an adjustable-rate mortgage loan (with a low introductory rate that will increase in the future) to a fixed-rate loan, you may find that your current payments would not go down. However, you could save a great deal of money over the life of the loan by avoiding future increases on your mortgage payments.
Actually, when you submit a loan application, your lender will give you a ?Good Faith Estimate?. This will include your new interest rate, mortgage payment and the amount you will pay over the life of your loan. Compare them to your current loan terms. If you cannot save more, a refinancing may not make sense for you.
What documentation will you need?
Before you call, you should first collect a set of documents that contain the information your lender will need. In general, Sovereign Bank will ask you to provide:
? Information about the monthly gross (before tax) income of all the borrowers on your loan, including recent pay stubs if you receive them or documentation of income you receive from other sources
? Your most recent income tax return
? Information about any second mortgage on the house
? Account balances and minimum monthly payments due on all of your credit cards
? Account balances and monthly payments on all your other debts such as student loans and car loans
Can you qualify for refinancing under Home Affordable Refinance Program, if you have both a first and second mortgage?
Of course, yes! At Sovereign Bank as long as what you owe on the first mortgage is less than 105% of the value of the property, you may qualify for a HARP even if you take out more than one mortgage loan. For example, if your property is worth $300,000, but you owe $315 or less on your first mortgage, you may be eligible.
Be aware that this requirement may vary with different mortgage servicers. For instance, at Bank of America, you (with more than one mortgage loan) may be eligible for refinancing under the HFRP, if the amount due on your first mortgage is at least 80% of your home?s value.
However, for those with more than one mortgage, their eligibility will partly depend on their ability to make new payments, as well as on their second mortgage lender. The lender needs to agree to remain as the ?second? lender.
Do you need to purchase mortgage insurance?
Um?it depends. If your current mortgage has private mortgage insurance, your current insurance coverage will be transferred to the refinanced loan. However, if your existing home loan doesn?t require private mortgage insurance, it won?t be required as part of the HARP.
Consideration
If you are not eligible, but are really having difficulty making your payments, Sovereign Bank also offers other solutions to help you. These solutions include:
? Repayment plans
? Loan modification
? Pre-foreclosure sale
? Deed-in-lieu of foreclosure
? Forbearance plan
? Loan assumption
Note: This web site is not affiliated with or associated to Sovereign Bank. Visit Sovereign Bank official service pages if you are looking for guaranteed information or professional financial advice.
Thanks for your visiting! We're always trying our best to complete the mortgage information presented here to help you get the most of your mortgage. Bookmark our site and revisit now and then for the latest info.
Source: http://www.mortgage-guides.com/articles/home-affordable-refinance-program-from-sovereign-bank.html
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