HARP 2.0 for Ohio residents has been in full effect for 2 months now. I’ve covered the benefits of the Home Affordable Refinance Program. Now, let’s take a look at how things have gone for those that have decided to take advantage of the historically low rates. You can always complete the form to your right to review your options.
HARP 2.0 Loan to Value Ratio Requirements in
Ohio
One of the major advantages with the HARP 2.0 program is that it technically allows for unlimited financing. If your home is worth $100,000 and you ower $300,000 on it, you qualify for a HARP 2.0 refinance.
However, it is up to each lender whether they will impose stricter guidelines. For instance, Fifth Third Mortgage had allowed LTVs up to 125% on HARP 1.0, and held these guidelines in place when HARP 2.0 was released. On April 24th, Fifth Third Mortgage released an update that allowed for financing up to 150% LTV on HARP 2.0. On May 14th (20 days later) they did a complete 180 and have dropped the max financing to 105% on HARP 2.0
Most lenders allow financing up to 125% on HARP 2.0, and a few that allow financing up to 150%, but not many that are allowing unlimited financing.
HARP 2.0 Appraisal Requirements in Ohio
The silver lining is that Appraisal Waivers are easier to get. 85% of the application I have seen for HARP 2.0 have received appraisal waivers. The appraisal waiver process differs slightly between Fannie Mae HARP loans and Freddie Mac HARP loans.
Fannie Mae – Fannie Mae’s Automated Underwriting System (AUS) known as Desktop Underwriter (DU) will issue an appraisal waiver based on the value that is input by the Loan Officer. It is either a yes or no.
Freddie Mac – Freddie Mac’s AUS known as Loan Prospector (LP) will tell you the value to use and how confident it is with that value. The file then is re-run through LP with that value. If the confidence level is High or Medium then most lenders will treat it as an appraisal waiver. If the confidence level is low, then an appraisal is required.
HARP 2.0 Underwriting Times in Ohio
Due to the increase in volume that most lenders have seen from the new HARP program, underwriting times have increased exponentially. There are still some lenders that are underwriting in 2-5 days, but there are some that are 30+ days in underwriting. If time is a factor, or you have vacations planned, you should let your Loan Officer know up front so he/she can plan accordingly.
Ohio Residents Cash to Close on HARP 2.0 (and any refinance)
Ohio property tax bills are coming due in the next couple of months. Most lenders will require that you pay your 2nd half property tax bill if it is due within 60 days of loan closing. The lender will also require that you put 2-3 months of your property taxes into the new escrow account. All in all, 8-9 months of property taxes will be collected at closing. Your Loan Officer should take this into consideration when estimating your cash to close.
Ohio homeowners can complete the form HERE to request a rate quote or call T.C. Strait directly at 513-777-8383
