Refinancing Underwater Borrowers

 Refinancing Underwater Borrowers

An Inside Mortgage Finance Webinar
Recorded April 25, 2012

Hear directly from your colleagues what you need to keep in mind as you jump into the latest government programs to help underwater mortgage borrowers. Find out how M&T Bank is running its HARP 2.0 business—what challenges and hidden surprises they’ve discovered. And SunTrust will address how you should build capacity before you launch your direct marketing. Learn what other issues with the programs have surfaced, directly from these experienced lenders.

As you know, the government has revved up its efforts to help refinance borrowers using Fannie Mae and Freddie Mac as well as the FHA. In the case of Fannie and Freddie, the revamped Home Affordable Refinance Program, HARP 2.0, is for borrowers with existing underwater GSE mortgages, and has seen significant volume increases this year. Gone are any loan-to-value ratio caps, certain risk-based fees for borrowers, and even some of the reps and warranties associated with the original program.

In the case of FHA, the government is looking to increase activity in the agency’s Streamlined Refinance Program as well as its Short Refi option. Additionally, the White House has proposed a new refinance program for underwater non-GSE and non-FHA borrowers.

Find which of these efforts will likely generate significant new mortgage business with this special Inside Mortgage Finance webinar recording. Hear from top execs at the Federal Housing Finance Agency and the FHA about the ins and outs of their revamped programs. And hear practical advice from lenders on how these programs are being received and executed in the real world. The presentations cover the refi options lenders now have at their disposal to help borrowers lower their payments and generate more mortgage business.


These industry experts share their insights and answer questions:




Jim Ahrens
Vice President

M&T Bank

Meg Burns
Senior Associate Director, Office of Housing and Regulatory Policy


Tim McKeever
Strategic Production Manager




 Kevin Stevens

Deputy Director (Acting),
Office of Single Family Program Development, Home Mortgage Insurance Division


 Guy Cecala
CEO & Publisher

Inside Mortgage Finance



 What You'll Learn:

  • Get the lowdown from the government and from today’s marketplace;
  • Build a loyal customer base as borrowers are so grateful to save money;
  • The real differences between HARP 1.0 and HARP 2.0;
  • Why most HARP activity is directed at loans with 105 or less LTVs;
  • Can lenders really compete for new HARP business?
  • LTV and CLTV rules for FHA’s Streamline Refinance Program;
  • Is it possible to use FHA’s Short Refi Option with HAMP?
  • Restrictions some lenders are placing on HARP refinancing;
  • The treatment of second liens;
  • Which lender fees can be added to HARP 2.0 or FHA Streamline Refinance Program loans;
  • Limitations on soliciting borrowers for the government refi programs;
  • How second liens are treated under HARP 2.0 and FHA’s refi programs.
  • What do you need to plan for before you begin offering HARP 2.0 loans?



HARP 2.0

Perhaps no other refi program has attracted more attention this year than Fannie’s and Freddie’s enhanced HARP initiative, which allows borrowers with good payment records to refinance their underwater GSE mortgages. There is no limit now on loan-to-value ratios, and the GSEs made changes to certain risk-based fees for borrowers, and even some of the reps and warranties associated with the original program. 

HARP 2.0 was officially rolled out Dec. 1, although the program wasn’t fully operational until last month when automated underwriting delivery was added. Mainstream lenders are reporting a lot of early borrower interest in HARP 2.0, but most of the new HARP activity is expected in the second and third quarters of 2012.

FHA Refi Options

Compared to Fannie Mae and Freddie Mac, there hasn’t been a lot of action in the FHA refinance programs. But that could change in 2012. FHA’s Streamline Refinance Program, which allows existing FHA borrowers to refinance into a new FHA mortgage without an appraisal or much new underwriting, is getting its up-front premium and annual premium slashed to just 0.1 percent and 0.55 percent, respectively, starting June 11. FHA also will no longer count streamlined refi loans towards a lender’s mortgage performance.

Meanwhile, non-FHA borrowers who are current but underwater can potentially get a new FHA mortgage if the lender agrees to write down the principal amount to under 100 percent of the value of their property under FHA’s Short Refi Option. This option has not attracted a lot of interest from lenders. Last month the agency announced some changes including expanding eligibility to some delinquent borrowers and extending the program through 2014 – and expects volume to pick up.

With this informative webinar, learn the particulars and ferret out your opportunities.

CD Only - $359.00
MP3 and Manual - $360.00

Please contact Customer Service if you need assistance: 1-800-570-5744


With mortgage production down noticeably this year from 2017, how many lenders might disappear via M&A or failure during the next 12 months?

10% or less. It’s not that bad out there.
11% to 25%. It’s a challenging market.
25% to 40%. It’s going to be very ugly.
No opinion.

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