Good morning Memphis! You are on the Real Estate Mortgage Shoppe program with me Jo Garner, Mortgage Officer with Evolve Bank and Trust and Attorney Ron Cohen affiliated with the Memphis Law Firm of Ballin, Ballin & Fishman and an owner of Premium Title and Jenett Rochester the Memphis location manager of Premium Title. Today we are talking about “Save Your House With the HARP Program–Save Your Wallet When Buying A Foreclosure or Short Sale”

Before we get into our topic let’s talk about the BIG news this week.

Mortgage rates gave us a little scare this week spiking higher for a few days but they begin to gradually drift back down again at the end of the week.

30 yr rates are about 4% to 4.25$
15 year rates are in the low 3’s to mid 3’s

The HARP refinance program to help homeowners who are underwater -owing more than the house is currently worth—here’s some GREAT NEWS for you! The full Home Affordable Refinance Program with no home value restrictions is now available. My assistant Susan Belew and I have this program available to you at Evolve Bank and Trust with absolutely no value restriction.

In fact we were discussing a loan yesterday where the borrower’s current mortgage balance compared to the current value of his home is over 200%!! This is a perfect example of how the HARP program can be a lifesaver for so many homeowners who owe more on their house than the property value.

Word to the Wise–If you are a homeowner who believes you owe more on your house than the current value—–DO NOT LET THIS AWESOME OPPORTUNITY PASS YOU BY! You can call our direct, personal line at (901) 482 0354. WE WANT TO GIVE YOU SOME BRAGGING RIGHTS when we refinance your loan to these very low rates–without you having to worry about the appraisal value. That number to call to talk personally off the air with Susan is 901 482 0354.

Here is the cliff note version of the hottest loan product that has hit the national market in decades! You can catch the past podcasts of this program on my blog .

How can you tell if your mortgage qualifies for the no-appraisal HARP program?

1. Your loan has to have been backed by Fannie Mae or Freddie Mac since on or before May 31, 2009. If you don’t know, Susan and I can determine if your loan is backed by Fannie or Freddie if you will give us some basic info. Call us at (901) 482 0354. We will check it for you free.
2. You need to have made your mortgage payments on time for the last 12 consecutive months.
3. Your property can be a residential primary residence, second home, or investment property as long as the property is 1 to 4 units—-like a single family home, a duplex, triplex or quadraplex. Your property can be a residential condo, planned unit development, attached or detached. It cannot be a manufactured home a condotel or a cooperative and it cannot have over 4 units to the property.
4. There is no loan-to value limits and there are no combined loan to value limits.
For instance, if you owe $2 or $300,000 on your loan and your property value is only $100,000, we can still refinance you to the lower rate. How great is that?

5. If you have a first mortgage and a second mortgage on your house, we an only
refinance your first mortgage. It will be between you and the bank who holds your 2nd mortgage on whether they will agree to stay in 2nd lien position behind the new loan—and they must to make this whole deal work for you.

6. If you are currently paying private mortgage insurance (that’s not homeowners
Insurance or hazard insurance, in most cases we can still refinance your mortgage and keep your mortgage insurance the same.. Private mortgage insurance , sometimes called PMI or MIP insures the lender in case of your default.

However, if your mortgage is covered by some of the now crippled or defunct private mortgage companies, then we cannot refinance your loan. Susan and I have a list of mortgage insurance companies who are accepted by HARP and those that are not. We may also be able to help you even if your loan does NOT qualify for the HARP program. Our direct line is (901) 482 0354.

7. You WILL have to verify enough income to qualify under Fannie Mae or Freddie
Mac guidelines.

8. You CAN roll in your closing costs AND the amount of taxes and insurance
required to set up your tax and insurance account. The max you can borrow is the amount it costs of your closing and taxes and insurance OR $5,000 whichever is less.

Today I am so glad we have attorney Ron Cohen with us by telephone. Ron, how are you today? I am so glad you are with us today.

We have been talking about how to help homeowners Save Their Homes from becoming foreclosures or shortsales by lowering the rate for the homeowner without worrying about an appraisal value.

But some of the greatest opportunities out in the market place for people looking to BUY property to live in or to rent out to tenants, is buying houses that have been foreclosed or houses where the lender has agreed to take less on the principal so distressed homeowners can sell their homes on a shortsale and there are some caveats to doing that too. .

Attorney Ron Cohen affiliated with the Memphis Law Firm of Ballin, Ballin & Fishman and an owner of Premium Title is available to talk with you today about title issues with foreclosures and short sales .

Ron, if a real estate homebuyer wants to buy a foreclosed home or short sale, what are some title issues commonly seen on these transactions? ……..Answers on podcast 3-14-12

Question 2 for Ron Cohen to answer:
Would you explain to our audience the difference between buying a short sale and buying a foreclosed property? Answer on podcast 3-14-12

Question 3 for Ron Cohen to answer: What if there are problems (or clouds) on the title? What are some common ways you fix this problem? Answer on podcast 3-14-12

Questions to ask Jo Garner: 1. What are some typical savings you see your customers getting when they refinance ?
There are 3 basic ways we see our customers saving money on a refinance:

1st Lowering the payment because of the unusually low interest rates
Example: refinancing a $200,000 loan to 4.125% would make their principal and interest payment $969/mo.
When they first borrowed the loan the loan amount had a balance of $230,000 with a 5.75% rate with a P& I payment of $1,342/mo.
By going from a 30 yr to a 30 yr they can lower their payment by $373/mo.
They could even use some of that savings to pay the mortgage off early if they choose to do that.

2nd. Shortening the terms to a 20 or 15 year loan from an original 30 yr loan with, say, 25 years remaining—this can save the person refinancing 10’s of thousands of dollars in the long term.

These are only two ways but there are more (cash out)

Question 2 for Jo Garner to answer:
We’ve been talking about caveats on title for properties. What are some caveats to look out for on using the new HARP refinance program?
1st -In some cases if the value is not entered into the underwriting system at a low enough estimated value, the computerized underwriting system may require more documentation on an appraisal, but there is still no limitation on value as far as the first mortgage goes

2nd. Homeowners using the program have to qualify with acceptable verified income. In some cases the person owning the house is now divorced and the other spouse no longer lives there and for obvious reasons, does not want to be on the loan?

The solution for that is to show that the occupying spouse who will be the borrower, has been able to successfully make all the mortgage payments on the mortgage on time and with their own funds with no help from others.

Real Estate Tip of the Week:

Make a friend; Be a Friend. If you or anyone you know wants to refinance their home loan but says they can’t because they owe too much and the value has dropped, please let Susan Belew, my very capable assistant, would like very much to talk with you off the air to see how we can help you. (901) 482-0354.

Some of the information shared by Attorney Ron Cohen:

In a normal market a seller sells a home, pays off the mortgage, delivers clear title to the purchaser and everyone lives happily ever after.

In today’s market, the seller might have a second mortgage on the house, a HELOC or a lien recorded by a contractor for unpaid construction work.

All of these creditors must be paid before anyone can think about moving on.

As a result of current real estate conditions many people have a negative net worth in their homes creating all sorts of title problems. No longer is there sufficient equity to pay off all creditors.

What do we do now?

One option is a short sale. A short sale requires finding a purchaser for your home and then persuading your mortgage lender to accept less than the balance due on the mortgage.

But what about my equity? It is gone.

But what about other liens such as the second mortgage, HELOC lender or contractor?

Those liens will have to be negotiated in order to deliver clear title.

Okay. Then how about letting my mortgage lender foreclosure so that we may get rid of those other liens?

That might be an option to resolve unpaid liens but it could be a lengthy process.

If I don’t have a bunch of liens and my lender refuses to accept a short sale, are there other options?

Yes, of course.

Your lender might consider modifying your loan so that you may stay in your home.

If I want to purchase one of these houses, how can I be sure that I am not buying a bunch of title problems?

Drum Roll:

By obtaining a policy of title insurance.

The title insurance company will search the public records, determine what liens exist against the property and then provide you with an insurance policy so that you may enjoy those much awaited restful nights in your new home.

Where can I get title insurance?

When you are ready to purchase your new home simply contact Premium Title Group…

Ron A. Cohen
Of Counsel: Kusper & Raucci, Chtd.
30 North LaSalle Street
Suite 3400
Chicago, Illinois 60602
312-346-1145 (direct)
312-332-4663 (facsimile)

Information on the HARP mortgage program by Jo Garner, Mortgage Officer Evolve Bank and Trust 6070 Poplar Ave Ste 100 Memphis, TN 38120 (901) 482 0354

For more information about the mortgage HARP 2B program that does not require an appraisal value, contact me for financing solutions with this program or others.