What is FHA Streamline Refinance?

Refinancing of a current FHA insured loan into another FHA insured loan is called an FHA Streamline Refinance. The mortgage to be refinanced must be current (not delinquent). Not all FHA to FHA refinances are streamline in nature.

Is there a minimum waiting period before which you can do a Streamline Refinance?

Even though FHA loans come with no pre-payment penalty, you need to wait for 211 days from your last FHA loan before which you are eligible for a new FHA streamline refinance.

Is there an appraisal required on FHA Streamline?

One of the biggest benefits of an FHA Streamline Refinance is that no appraisals are required. Your Loan-to-Value Ratio (LTV) is calculated based on the last appraised value when you got the current loan. However, no cash-outs are allowed.

What is the Payment Benefit Requirement?

For you to qualify for an FHA Streamline loan, the new loan must meet a certain payment benefit requirement or you should be moving from an ARM (Adjustable Rate Mortgage) to a Fixed Loan.  The table below shows the exact benefit requirements:

What if I dont meet the Payment Benefit Requirement?

If you can’t meet the 5% benefit requirement, you can still refinance from an FHA loan to another FHA loan. You may still be eligible for an UFMIP refund (see below), you would have to get the house appraised again. And the new Loan-to-Value ratio will be calculated based on the new appraised value, and that ratio can not exceed 97.75%.

How much refund do I get on my UFMIP?

When you refinance from an FHA loan to another FHA loan within 36 months, you are eligible for a partial UFMIP (Up front Mortgage Insurance) refund. The refund is a percentage of the actual UFMIP you paid on your current FHA mortgage. The percentage goes down every month and ultimately becomes zero after 36 months. The table below provides all the details:

What is the MIP rate on an FHA Streamline Refinance?

The MIP (Mortgage Insurance Premium) on an FHA Streamline (and even a regular FHA loan) are of 2 types – Up front Mortgage Insurance Premium (UFMIP) and the Annual Mortgage Insurance Premium. The current UFMIP is 1.75% for all loans. However, the Annual Mortgage Insurance Premium numbers vary based on the loan terms, loan amount and LTV. The table below details all possible scenarios.

Note – If your current FHA Loan was endorsed before May 31, 2009 you may be eligible for reduced UFMIP of 0.01% and an annual mortgage insurance premium of 0.55%. If you are not sure if your current loan was endorsed before that date, contact us and we can find that for you.

How Can I get a Mortgage Rate Quote for FHA Streamline Refinance?

FHA Streamline Refinance typically has the same rates as other FHA programs. The best way to get a live and most current rate quote is by completing this Rate Quote Request Form.

What are the closing costs on an FHA Streamline Refinance?

Typical closing costs may include Lender origination fees (Points) and Escrow/Title related expenses and can add up to 3%-5% of your loan amount depending on the lender and the loan amount. At Arcus Lending, we do offer a no point and no closing cost option. Start here with completing a form in less than 60 seconds (No SSN required).

You will also be required to set-up a new impound/escrow account and will have to come up with reserves money for your Property Taxes and Home Insurance. However, your current lender will refund you the escrow reserves balance after the new refinance is closed.

Are you an FHA Approved Lender?

Yes, Arcus Lending is an FHA approved lender in the states of California, Washington and Oregon. If your property is in any other state, we may be able to refer you to one of our nationwide associates of trusted loan officers/mortgage brokers/direct lenders.

How can I get started with an FHA Streamline Refinance?

• You can start by completing the loan application on our secured site – Apply Online now!
• You can also contact me via phone at (408) 615-0655 or via email at Shashank@ArcusLending.com

You may also like to read – Ultimate Guide to FHA Mortgage Insurance Premiums

After years of a declining housing market and no solutions in sight, there are two terms that are making the light of day: Principal reduction and Underwater mortgage refinance.

As everyone knows, the housing recession began in 2007 when housing values started falling and homeowners could not sell their homes. Then people who were over their heads in mortgages they could not afford started defaulting on their loans. The rest is housing meltdown history. Now, five years later, it appears that a few members of the calvary are riding in with principal reductions and underwater mortgage refinance programs to save the day.

A principal reduction is when a bank agrees to reduce the balance on a mortgage whether on their own accord or through a company which does it as a business opportunity. Either way, the homeowner ends up owing less.

An underwater mortgage refinance is when a bank agrees to write down the mortgage interest rate, saving a homeowner money on their monthly mortgage.

Both of these tactics are being used to staunch the flow of foreclosures and short sales.  Here are some recent news stories about principal reductions and underwater mortgage refinances that can help homeowners lower their monthly mortgage and stay in their homes:

* Bank of America has started sending letters to thousands of homeowners in the United States, offering to forgive a portion of the principal balance on their mortgages by an average of $150,000 each. These principle reductions come on the heels of the $25 billion nationwide settlement over alleged foreclosure abuses, which we wrote about in March, Interesting to note, however, that Bank of America is starting with loans that are already three months late AND for the principal reduction to take effect, the homeowner has to make three months of on-time loan payments.

* Now that Freddie Mac has made the official announcement of their new CEO, Donald Layton, formerly of E-Trade,  the GSE giant can begin to move forward on considering principal reductions on mortgages owned by Freddie Mac, a plan that was discussed by Layton’s predecessor, Charles “Ed” Haldeman. Recently Haldeman broke the news that Freddie Mac would be open to principal reductions at a real estate industry event.

* For California homeowners, the $2 billion received by the national settlement funded California’s mortgage payment assistance program, Keep Your Home California (KYHC) . This week, the California Housing Finance Agency said  that the federal government has authorized the expansion of two programs that help struggling California homeowners pay their mortgages.  KYHC will enable more homeowners to qualify for the program. These changes are being implemented with the hope that more mortgage servicers will participate in the principal reduction program, one of the four programs offered by Keep Your Home California.

* We have written extensively about the HARP 2.0 program, a recently released underwater mortgage refinance  Federal program which helps homeowners refinance their mortgages. The Obama Administration’s government refinance assistance program designed to help home owners who’s mortgage is over 80% Loan to Value or upside down/underwater in value.  The program is unique because it’s designed to help home owners who are current on their mortgage payment but have not been able to refinance into a lower rate and payment due to declining home values.

All of these programs are designed to get the country back to a healthy housing market and allow as many people as possible to keep their homes. If you have questions about the HARP 2.0 program, we have numerous resources for you.

Contact me directly at Shashank@ArcusLending.com or call (408) 615-0655.

 If you search online, you will find numerous financial and debt management experts offering tips and tricks on managing debt such as mortgage, credit card debt, student loan and so on. However, it is important to evaluate one’s own personal financial situation before implementing any such debt relief tips. This is to ensure that you benefit from such advice and not further pile up debts that you become responsible for. So, here are 5 strategies to repay your california mortgage faster.

Make Extra Payments: If there is no pre-payment penalty, you can make extra payments on the mortgage loan. The extra amount of money is taken off from the principal mortgage amount. For example, a $400,000 loan at 4% rate for 30 year fixed will pay off in only 25 years if you make $200 extra payment every month.

Make Bi-Weekly Payments: Bi-weekly payments on California mortgage loans are better than a monthly payment. In doing so, at the end of the financial year, you are paying one month extra payment. Therefore, the extra month’s payment will shorten the term of the mortgage. Every penny counts when you’re repaying any sort of debt. For example – Using the same numbers as above, by making bi-weekly payment you would pay off the loan is 25.8 years instead of a regular 30 years.

Get a shorter-term refinance loan: This financial strategy has gained in popularity among the borrowers in California. The rate of interest has nose-dived and it is much simpler for the homeowners to repay their mortgage debts. The advantage of this refinance is that by paying high monthly payments you pay off the loan in considerably shorter period of time. For example – Instead of taking a regular 30 Year Fixed mortgage, consider taking a 20, 15 or a 10 year mortgage. If you can afford the payment, you save on interest cost and also pay off the loan much quicker.

Make a One Time Big Payment: If you get inheritance, gift or a big bonus, you can make one large lumpsum payment. That will reduce your principal balance substantially and thus pay off the loan quicker. You may also ask the lender to “recast” the loan and reduce the monthly obligation for future payments based on the new reduced principal balance.

Monitor Your Mortgage Rate: Its not uncommon for homeowners to lose track of mortgage rates once they buy a home. At Arcus Lending, we manage the customer rates for life by actively monitoring their mortgage rates. That way we are always alert to any refinance opportunity. Getting a lower rate can help homeowners pay off the loan faster, if they keep paying the same mortgage payment as earlier. We offer this service even to clients who didn’t get their current loan with us. As us how you can enroll for this. Else, make sure you are working with a California Mortgage Lender who provides similar service.

Note – the ideas mentioned here are not meant to be a tax advice. You are encouraged to contact your CPA/Financial Adviser before making any significant money decision.

Ultimate guide to Upfront and Monthly Mortgage Insurance Premiums (MIP/PMI) rates for FHA purchase loans and (streamline) refinances in California, Washington and Oregon.

FHA charges both an upfront mortgage insurance premium and monthly mortgage insurance on almost all the loans it insures. On December 23, 2011 the President signed into law Temporary Payroll Tax Cut Continuation Act of 2011which required FHA to increase the annual mortgage insurance premium.

Annual Mortgage Insurance Premium:

Annual Mortgage Insurance Premium on High Balance or Jumbo Loan Amounts:

Annual Mortgage Insurance Premium on certain FHA Streamlined Refinance Transactions:

For all Streamline Refinance transactions that is refinancing FHA loans endorsed on or before May 31, 2009, the annual MIP will be only 55 bps regardless of the loan amount. For all other streamlined refinances, regular MIP rates will be charged. This is effective for loan applications taken (and FHA case number requested) on or after June 11, 2012.

FHA Monthly Mortgage Insurance Premium Calculator:

The Loan Amount is multiplied with the Insurance factor and divided by 12 to arrive at the monthly mortgage insurance payment. For example – If your loan amount is $400,000 and your annual MIP is 120 bps, your monthly MIP payment would be -

(400,000 x .0120)/12 = $400/month

Click here to get an FHA Rate Quote

FHA Loans without any Annual Mortgage Insurance Premium:

Yes it’s still possible. Loans with amortization of 15 years AND Loan to Value Ratio (LTV) of 78% or less still qualifies for no FHA annual mortgage insurance premium. The applicable upfront mortgage insurance premium still applies.

FHA Upfront Mortgage Insurance Premium (UFMIP):

The  upfront mortgage insurance premium will be increasing to 1.75% of the base loan amount starting April 9, 2012. This applies to all loan terms and LTV ratios. FHA does allow financing of UFMIP into the loan amount. For example, if your loan amount is $400,000, instead of paying 1.75% or $7000 as closing cost, you can add that to your loan amount and make your principal balance $407,000.

FHA Reduced Upfront Mortgage Insurance Premium for certain Streamlined Refinance Transactions:

For all Streamline Refinance transactions that is refinancing FHA loans endorsed on or before May 31, 2009, the UFMIP will be only 0.01% of the base loan amount. For all other streamlined refinances, regular UFMIP rates will be charged. This is effective for loan applications taken (and FHA case number requested) on or after June 11, 2012.

Click here to get an FHA Rate Quote

Contact me at (408) 615-0655 or Shashank@ArcusLending.com to get a free consultation or rate quote for an FHA financing in California, Oregon or Washington.

You may also like to read – FHA Loans after Foreclosure, Bankruptcy and Judgment and Collection

California Mortgage Rates for Refinance and Home Purchase loans are up .25% in 2 days and are hitting a 6 months high. On Tuesday, it was like as if the dam broke. After the rates have remained stable and under 4% for a solid 6 months – you could see it was coming.

Mortgage Backed Securities (MBS) were hit hard on Tuesday and by end of Wednesday  they had fallen a dramatic 100+ basis points. Fall in MBS prices mean less demand for them and higher mortgage rates. For four months the MBS traded quietly in essentially a 15 basis point yield range with a few forays out of the range that lasted just a day or so.  Much of the rationale for low rates is still there like the situation in Europe with Greece’s debts, the Fed’s constant comments that the US economy wasn’t on solid footing, and that the Fed would keep the FF rate at zero to +0.25% thru 2014. But these rationale has lessened. Putting it in perspective, interest rates were at 50 yr lows and were unlikely to decline much regardless of the momentary circumstances.

On Tuesday the dam broke. The trigger that started the run was two-fold; Feb retail sales were stronger than thought then in the afternoon the Fed policy statement was the preverbial straw. There was a growing thought that the Fed would launch another easing move to increase buying of treasuries and MBSs; the FOMC said no, not yet. The economic outlook according to the Fed had improved somewhat from the previous FOMC meeting. The stock market has continued to increase taking another support from the bond market.  Even though some correction (read increase in rates) were expected, what happened was too sudden and too steep.

The increase in rates in the past 2 days has been swift. Conforming California mortgage rates which was averaging  3.875% is now at 4%-4.125% and conforming Jumbos (Loan Amounts $417,001 to $625,500) is between 4.25% to 4.375%. These are what we are quoting for 740+ credit and no points. That’s a full .25% jump in rates in just 2 days. All this just in time for the HARP 2.0 launch next week.

Get a Live Rate Quote

Outlook for California Mortgage Rates – I believe rates will not increase too much from here. Will rates fall back to under 3.875% on a 30 Year Fixed? Not likely as long as Europe doesn’t completely implode, and that isn’t expected anytime soon. The Fed is committed to keeping rates low; but they don’t control day-to-day demand and trading of 10 year Treasury and Mortgage Backed Securities which ultimately controls 30 Year Fixed Mortgage Rates. But whatever happens, rest assured you will hear from me here.

Whether you are looking to buy or Refinance, contact us for a rate quote – (408) 615-0655 or Info@ArcusLending.com.

Homeowners more deeply underwater on mortgages handled by five major U.S. banking firms are prime candidates for getting help from a $25-billion nationwide settlement over alleged foreclosure abuses.

That’s because the settlement gives the nation’s largest mortgage servicers more incentives to help those who owe 40% to 75% more than the value of their homes, according to details of the settlement filed Monday in U.S. District Court in Washington.

Even so, the settlement’s effect on the housing market could be limited. Only customers of the five largest servicers are eligible for principal reductions, and only if their loan is not owned or backed by government-controlled mortgage financing firms Fannie Mae or Freddie Mac.

However, homeowners who do have mortgages backed by Fannie Mae or Freddie Mac can look to the Home Affordable Refinance Program being launched this weekend on March 17th.  The HARP program is part of a wider scope program known as the Making Home Affordable Program (MHA). Both MHA and HARP are critical elements of the Obama Administration’s broad strategy to help homeowners avoid foreclosure, stabilize the country’s housing market, and improve the nation’s economy.

We have written recently about HARP  including guidelines and why the Government thinks this time they got it right.

Homeowners who are underwater have options and this program may be a way to assist them in saving their homes and lower their monthly payments, permanently, whereas the recent 18.5 billion dollar settlement  for California homeowners would only give some homeowners a few thousand dollars.

By using the resource material Arcus Lending has created for homeowners, Bay Area residents can easily assess if they qualify for HARP and our team can take them through the process, if they require consulting.

We have created an online education toolbox to help homeowners avail themselves of the program details of HARP in a variety of easy to understand initiatives including an exclusive website, www.CaliforniaHomeRefinance.com which offers FAQ’s about the program and allows users to see if they hold a Fannie or Freddie loan and if they qualify for a refinance. The can also obtain a free rate quote and a complimentary consultation.

On this site, homeowners can download a free e-book, “17 Things You Need to Know About California’s HARP Refinance”

We also created a Facebook business page to share HARP FAQ’s, answer questions or let homeowners connect with each other.

Please feel free to contact us directly if you would like to discuss how we can help you.

What is Making Home Affordable (MHA) program?

The Making Home Affordable Program (MHA) is a critical part of the Obama Administration’s broad strategy to help California, Washington and Oregon homeowners (and rest of the country homeowners) avoid foreclosure, stabilize the country’s housing market, and improve the nation’s economy.

What is HARP?

First established in 2009, HARP (Home Affordable Refinance Program) was initiated as an option for underwater homeowners wanting to refinance their mortgage at lower interest rates with government expectations that it would assist millions of homeowners who found themselves owing more on their mortgages than what their homes were worth.

HARP is known by several names, including:

• • Obama Government Refinance Program
• • Fannie Mae DU Refi Plus
• • Freddie Mac Open Access
• • Refinance for Underwater Mortgages
• • Upside Down Refinance

Up until now, HARP has fallen short of these expectations – prompting the government to relax eligibility requirements in an effort to help more people stave off foreclosure. Billed as HARP 2.0, the government has extended the program until December 31, 2013 and set out new guidelines for those wishing to apply.

 Why HARP 1.0 didn’t work and why the HARP 2.0 was launched?

One of the biggest criticisms of the original plan was that in order to qualify, homeowner’s loan-to-value ratio was required to be less than 125%, automatically ruling out millions whose home value fell below that figure. This requirement has now been relaxed with HARP 2.0.

How do I qualify for HARP 2?

• Your loan must be owned or serviced by Fannie Mae or Freddie Mac. Later in this post I will show you how to find this information for your loan.
• Your loan must have closed before May 2009.
• You must have had no late mortgage payments in the past six months and no more than one late payment in the past 7-12 months. (You may still qualify even if you were late. Find out how later in this post)

Complete this form in 60 Seconds to check if you qualify for HARP (Scroll down after you reach the page)

How do I find out if my loan is owned by Fannie Mae or Freddie Mac?

• • To find out if your loan is owned by Fannie Mae go to – http://fanniemae.com/loanlookup/
• • To find out if your loan is owned by Freddie Mac go to – https://ww3.freddiemac.com/corporate/

Note that even if you think the loan is owned by a bank where you make your monthly payments, the loan could still be owned/backed by Fannie Mae/Freddie Mac.  And may still qualify.

How much underwater I can be and still qualify for HARP?

There is no limit to this. The guideline allows for unlimited Loan to Value Ratio (LTV). What that means is that you can qualify for HARP even if you are seriously underwater. For example, if your estimated home value is $200,000 and your loan balance is $350,000 – you may still qualify if you meet other eligibility parameters.

Do I have to get a HARP loan from my current bank or one of the big banks?

No. There are several lenders large and small who are approved by the government to offer HARP loans to underwater mortgage holders. In fact, some of the recent news articles are talking about longer turn times and higher interest rates from some of these banks. It may be a better idea to work with a smaller lender, like Arcus Lending.

Are appraisals required for the new HARP Refinance Program?

In most cases, an appraisal will not be required. Even where an appraisal is ordered the value will have no impact on the loan decision. On loans where no appraisal is ordered, a Property Inspection Waiver (PIW) fee of $75 will be charged.

Can I get the new HARP if I have mortgage insurance (MI or PMI)?

One word answer – Yes, you can get a  HARP 2.0 Loan if your current mortgage has mortgage Insurance (also called MI or PMI). However, there could be several possible scenarios to this and I detail all of that below:

Will my mortgage insurance payments go up if I refinance into the new HARP? No. You can request for a transfer of the current mortgage insurance certificate to the new loan. Talk to your lender about it.

What if I have no MI now, will I have to pay MI with HARP 2 mortgage because my LTV will be >80%? No, you won’t have to. Even if the new loan will be >80% in LTV (Loan to Property Value Ratio) – you still don’t need to get a mortgage insurance if you currently don’t have one.

I have Lender Paid Mortgage Insurance (LPMI), can I refinance into the new HARP loan? If your current loan at the time of closing was over 80% and you are not paying monthly mortgage insurance, most likely you have a Lender Paid Mortgage Insurance (LPMI) programa . You would be able to refinance even if you have an LPMI. You would need to transfer the same coverage level from your current MI company to the new HARP 2.0 Refinance.

What about HARP 2 mortgage rates?

Both Fannie Mae and Freddie Mac have waived some of their fees to make sure the rates on the new HARP remains low. Some of the bigger banks are not passing all the benefits to the borrower and their rates are higher than some smaller lenders like us. We also offer no points and no closing cost refinance. To get a quote for the best HARP mortgage rates in the states of California, Oregon or Washington click here.

Can I qualify for HARP if I have a 2^nd mortgage?

You can’t combine a 1st and 2nd mortgage and you can’t cash out with a California Home Affordable Refinance Program (HARP). But, you can still refinance the 1st mortgage if it meets the new HARP qualifying guidelines. You will have to get the 2nd mortgage re-subordinated. Your 2nd mortgage lender needs to approve this. Indications are, most of the lenders are willing to do it if you are refinancing your first mortgage under the new Obama Government Refinance Program. If you are refinancing the 1st mortgage through our company, we will help you get the 2nd mortgage re-subordinated.

Do I have to be living in the house to qualify?

No – you don’t have to. The HARP Loan applies to all 3 occupancy types –

• • Primary Residence
• • Second Homes
• • Investment (Rental) Properties

Can I be late on my mortgage and still qualify? 

Yes, you can. And here’s how. Say if you are currently 30 days late on your mortgage payment and want to qualify for HARP 2 program. If you have not been late in the last 12 months and this is the first month you are late; you can now start making all your payments on time and qualify after 6 months. Remember the rule – no late payments in the last 6 months and no more than 1 late in the last 7-12 months.

Can I use HARP Again?

HARP refinance can be used only once. Even though the HARP has been extended till December, 2013 if you have used HARP already, you can’t avail yourself of this program again

Can I use HARP if my current loan is owned by other Government agencies like FHA, VA or USDA?

No, to qualify for HARP your loan must be owned by Fannie Mae or Freddie Mac.

Can I short sale my property after HARP 2.0 refinance?

There are no pre-payment penalties or restrictions on HARP 2 refinance. Meaning, you can pay off or sell your house anytime after the refinance. Remember though, the purpose of offering you a program to lower your interest rates and the payment is for you to be able to afford the new payment and avoid short-sale or a foreclosure.

What do I do next if I am ready to apply or if I need more information?

• If you are ready to apply, you can apply online. (Hit the Apply Now Button)
• You can also call us at 408.615.0655 or send us an email – Info@ArcusLending.com

If you need more information, there are several ways to get it:

• Our website created exclusively for HARP
• On Facebook 
• Official Website

FHA recently made underwriting guideline changes for Self Employed borrowers and borrowers who have disputed and/or collection accounts. The changes apply to residents of states of California, Washington, Oregon and rest of the country. These changes will be effective April 1, 2012 and will impact all FHA mortgages except non-credit qualifying Streamline Refinances and Reverse Mortgages.

New Guideline about Self Employed Borrowers:

Profit and Loss (P&L) and a Balance Sheet is required if more than a calendar quarter has elapsed since date of most recent calendar or fiscal-year end tax return was filed by the borrower. Additionally, if income used to qualify the borrower exceeds the two year average of tax returns, an audited P&L or signed quarterly tax returns obtained from IRS are required.

Click here to get a rate quote for FHA Loans

New Guideline about Disputed/Collection Accounts:

• The total outstanding balances on all disputed credit accounts or collections needs to be under $1000, and
• Disputed credit accounts or collections need to be aged two years from date of last activity as indicated on the most recent credit report.

If you have multiple collection or disputed accounts with cumulative balance equal to or greater than $1000, the accounts must be resolved or paid in full prior to closing. By “resolved”, the guidelines specify payment arrangements must have been made and a verified 3 payments would have been made per the agreed terms.

If the total outstanding balance of all collection accounts is less that $1000, then you are not required to pay off the account(s) to get an FHA loan approved. Paying down of balances in disputed and collections accounts to reduce the balance(s) below $1000 is not permitted and is not considered a valid resolution.

Click here to get a Rate Quote for FHA Loans

Any Judgments need to be paid off

Any judgements need to be paid off to obtain an FHA mortgage. Exception to this rule may be made if the borrower has made an agreement with the creditor to payoff by making monthly payments. A proof is required that a minimum of 3 such payments have been made as agreed. And the monthly payments will be included in the debt-to-income ratio (DTI) calculations.

You may also be interested in reading – FHA Loans after Bankruptcy and Foreclosure

Bank of America continues to hit the headlines, unfortunately for all the wrong reasons. It all started late in 2011 when Bank of America decided to exit the Correspondent Lending business. Housing wire reported that Bank Of America was grappling with $1 trillion in soured mortgages and securities written prior to the 2008 acquisition of Countrywide Financial Corp. Even though the BofA spokesperson mentioned it was done to focus more on the “direct-to-consumer” channel.

Then earlier this year Bloomberg reported:

Bank of America’s retail channel has been unable to keep up with demand for borrowers wanting to refinance, thanks in part to HARP Phase II, which is beginning to roll out. Per the article, borrowers are being placed on a 90 day waiting list. “Bank of America is telling some customers who call during high volume periods of the day to make a reservation. And once they do that, it could take anywhere from 60 to 90 days just to hear back. Even then, it’s unclear how much longer it will take to apply for a refinance, get the loan underwritten, and finally get it funded.” And don’t forget that it stopped offering cash out refinances last month so if borrowers want to tap their home equity, they’ll either have to try a HELOC or go elsewhere.

But didn’t the Bank of America spokesperson say that the correspondent lending is being closed because they want to focus on the retail channel? So if being focussed means 60-90 days to return customer calls, imagine the service levels if they were a little less focussed! Click here to Get a HARP 2 rate quote now.

Then came the news that Bank of America has decided to stop selling mortgages to Fannie Mae. BofA blamed Fannie Mae with coming up with new guidelines which will increase it’s chances of repurchase and thus increase it’s losses and cash-flow. Fannie Mae though in it’s announcement mentioned that it was not a decision taken with mutual consent. Rather, it was Fannie Mae who alone opted not to renew contracts with Bank of America. Fannie Mae also mentioned – as of December 31, 2011 74% of the Mortgage Insurance (MI) rescission notices received by Bank of America has not been resolved.

In my personal conversations with Real Estate Agents, the frustration with long turn times to close on a mortgage loan for their clients is evident. Internally, some of BofA loan officers are starting to refer to bank’s mortgage business as “The Titanic”. In fact, Origination News predicted that by end of this year Bank of America will drop down to 10th in the list of top mortgage origination companies in the country. Octavio Garduno, a Real Estate Agent with Coldwell Banker had to say this on Facebook about Bank of America pre-approvals (see image below)

They don’t seem to be doing that great even with other businesses. Wall Street Journal recently reported that their new fees plan for checking accounts is drawing a lot of fire both from customers and regulators.

I usually never bash my competition, at least publicly on my blog. But I think it’s my responsibility to bring the important lending news to you. As a reader to my posts you expect that on this site.

So if you have been a Bank of America mortgage customer and now looking for an option for your HARP 2 or other mortgage loans with better customer service levels – we are here for you. (A shameless plug you say?)