Home Affordable Refinance Plan (HARP)

Home Affordable Refinance Plan (HARP)

Monday the Federal Housing Finance Agency (FHFA) released an announcement that outlined changes to the current Home Affordable Refinance Plan (HARP).

Highlights included:

• Lower loan level adjustments for some scenarios, geared towards borrowers who refinance intolower amortization periods.
• Allowing LTVs to 125% and above.
• Eliminating new appraisals where there is a reliable AVM estimate.
• Waiving certain representations and warranties that lenders commit to in making loans owned orguaranteed by the FNMAand FHLMC. (This was the primary reason most investors did not offer LTVs above 105% on the current HAMP programs.)
• Extending the end date for HARP until Dec. 31, 2013.

Loans eligible for the new plan:

• Loans that were originally sold to FNMA or FHLMC before May 31, 2009 with an LTV of 80%or above. If your borrower is unsure who purchased their loan, below are the links for Fannie

Mae and Freddie Mac:

Fannie Mae: http://www.fanniemae.com/loanlookup/
Freddie Mac: https://ww3.freddiemac.com/corporate/

•  Borrowers must be current on their mortgage payments with no late payment in the last 6 months,and no more than one late payment over the past 12 months.

Implementation Dates:

FHFA is the agency that regulates both Fannie Mae and Freddie Mac, but both Fannie and Freddie have not released any additional information on HARP Phase II. Per the news release, they will “issue guidance with operation details…by November 15”. Also remember that in addition to new guides, the agencies will have to update their automated underwriting machines, Desktop Underwriter and Loan Prospector. Delivery of these loans to the agencies is not expected to be available until the first quarter of 2011.

6 Quick Fixes That Give You The Best Bang For The Buck

Simple and affordable do-it-yourself projects can greatly increase a home's resale value, according to Home Gain’s annual home improvement and staging survey. The marketing company surveyed nearly 600 real estate professionals to discover which DYI home improvement projects give sellers the biggest return for their buck. Here are six projects under $1,000 (amounts are estimated) that made the list.

1. Cleaning and DE cluttering.  Remove any personal items, unclutter countertops, organize closets and shelves, and make the home sparkling clean.
$290 COST
$1,900 RETURN

2. Brightening. Clean all windows inside and out, replace old curtains, update lighting fixtures, and remove anything that blocks light from the windows.
$375 COST
$1,550 RETURN

3. Smart staging. Rearrange furniture, bring in new accessories and furnishings to enhance rooms, incorporate artwork, and play soft music in the background. 
$550 COST
$2,194 RETURN  

4. Landscaping enhancements. Punch up the home's curb appeal in the front and back yards by adding bark mulch, bushes, and flowers and ensuring current plants and grass are well-cared for and manicured.
$540 COST
$ 1,932 RETURN

5. Repairing electrical or plumbing. Fix leaks under the sinks, remove any mildew stains, and ensure all plumbing is in good working condition. Update the homes electrical with new wiring for modern appliances, fix any lights or outlets that don't work, and replace old plug points with new safety fixtures.
Electrical with new wiring for modern appliances, fix any lights or outlets that don't work, and replace old plug points with new safety fixtures.
$535 COST
$1,505 RETURN

6. Replacing or shampooing dirty carpets. Steam-clean carpets, replace any worn carpets, and repair any floor creaks.
$647 COST
$1,739 RETURN

Leave Your Home Vacant? You Could Lose Insurance Coverage

Do the geese flying south have you thinking of closing up your house and spending the winter in a warmer climate? Are you moving out of town and trying to rent your old home? Before you pack your swimsuit and sandals, take note: If you leave your house empty for too long, you could lose your home owners insurance — and your home equity if a fire or other disaster destroys or damages your house.

Insurance companies hate vacant houses, whether you’re taking a extended vacation or you’re moving out of town and leaving your house empty. If you’re not home and a water pipe busts, a fire starts, or someone breaks in, chances are the subsequent mess is going to be pretty big — along with the insurance claim for the damage.

If you’re lucky, your insurance company will let you leave the house vacant, but just won’t pay for certain things like broken glass, vandalism, or malicious mischief. At worst, your home owners insurance company will yank your policy if you go away and leave the house unattended for a month or more.

Some companies, like State Farm, decide on a case-by-case basis whether you can keep your policy when you’re temporarily not living in your home, especially if you’ve got a plan to take care of the place while you’re out of town.

Say you’re going on a two-month, around-the-world cruise (lucky you!). You’re more likely to keep your coverage if you hire a company to shovel the snow so your home looks occupied while you’re gone. 

Some insurers will cancel your policy if your house is vacant for 30 days. If that happens to you, call a commercial insurance broker. Commercial agents sell insurance to landlords who have vacant houses all the time — during renovations, or when they’re between tenants.

Expect to pay about 15% to 20% more than you were paying for your regular home owners insurance.

The bottom line is that if you’re heading south for the winter, read the fine print in your home owners policy to see what it says about vacancies. Then, email your agent or insurance company to double-check the rules. Don’t call, because an email is a written record of your communication. You might need that record later if the company refuses to pay a claim because your house was vacant.

Have you left your house vacant for more than a month? Did you check your home owners insurance policy before you left?