Home Afforndable Refinance Program or HARP 2.0, which stands for the second version is to be available for processing and funding loans owned by Fannie Mae on March 19,2012. 
What is different about this version is that now home owners can refinance regardless of the equity in their home.  It is primary designed for the home owner the owes more than their home is worth today if they were to try and sell the home.   Example:   Home Loan balance $ 300,000  Home Value is $ 180,000 today.
Even if you orignially only put 5 % down, you can still refinance.  Most Mortgage Insurance companies are now cooperating with the programs as well.   This new HARP loan version, should help a few million more home owners lower their payments.   

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Re: Yahoo! News Story - BofA halts foreclosures in 50 states - Yahoo! News BOFA Freeze:   

We heard this was coming last month and applies as follows.  This is for their processing proceedures only to make sure their foreclosure  process are being done correctly and withing the "Letter" of the law, thus removed the ability for homeowners to stay in the property longer, or file "Wrongful Foreclosure Suit" against them.

There have been a lot of start up companies using one main attorney as the president with other small time attorneys and management people taking retainer fees saying they can represent the homeowners in a wrongful foreclosure lawsuit. It does not work in most cases, and costs the bank a lot of time and money. These guys are using this business scheme based on
previous rightful cases in attempt to make money.

Loan companies across the board are dragging their process out reviewing their process, and BOFA is just making it public to boost their public image which is what the lending institutions are telling us.


Hi Joe,

I have run into several homeowners who have sent some of these companies $ 3000 to $ 5000 and got nothing in return.
Most are scam companies, I believe.  I believe that this is part of the problem and I bet you are right that B of A is using it to boost public image as well.

I believe that the servicing companies are grossly understaffed, fighting extremely thin margins of profitability. I had a very interesting conversation with a Loss Mitigation guy the other day, and he opened up another angle that most of us never think about.
I have found in the last 2 short sales that expenses of the seller and concessions can make a big difference in the short sale price. It seems the lower the concessions and a contribution from a seller, can determine a lower short sale price, by more than just the adjustments. Concessions are heavily weighted in the final price approvals.

The loss mitigation officer said "the price of the short sale approval is highly dependent on the yield of the bond portfolio that your loan belongs. The approval of the short sale is predicated on an actuarial formula used to predict the future value of the entire portfolio. The original portfolio value calculations originally predicated a number of losses and payoffs due to refinance, and most portfolios based on the last 10 years were battling quick run off from refinance, so the original calculations in a lot of cases
is not that as bad, as one would think. Every loan is in a different pool of loans, and depending on how that loss affects the pool determines the short sale approval price, as well as other factors, such as the ones we think about most, appraisal, condition of home, location, current buyers, local market conditions ect". To say the least it is complicated and takes too many signatures to sign off a loss and time to do the calculations.

Most people focus on the real estate market as the driving force and the reason for the slow down in the economy, but the reasons are misunderstood.  Our economic slow down is not directly just from the loss or property value itself, and even less on the losses the investors are dealing with.  The biggest reason for the slow down is the lack of equity, that was being tapped that put money in consumers hands to spend.  Its really all about the ability of the consumer to spend and save. That of equity has just killed the consumer equity, that was used as a cash machines.

Normal incomes are not enough to keep the economy growing as it was.  Until we gotten to the bottom of our market we will not see alot of recovery and strength in growth in the economy again.   

If you did not capture the Federal Tax Credit the State of California has allocated an new Tax Credit allowance for new and existing home purchases.  So dont miss this one, it is also a give a way, but It begins on Contracts closed after May 1st, 2010. 
So contracts written now are eligible for the State Tax credit.   There is a difference to this give a way so, make sure you understand how this tax credit is very different from the Federal Tax Credit.  The State of CA credit is also based on you purchase price but there is an extra calculation that is involved.  Your tax credit in most cases will be capped at the actual tax liability that you will pay based on your 2010 income tax return, not the $ 10,000.   So dont think the State of CA is going to give you the maximum of $10,000 just because you bought the $200,000 house.  In many cases your actual Califonia income tax is under 5 % of your taxable income after other deductions.  An average income earner of $60,000 per year or $ 5,000 per month may only pay about $ 3,000 or less in actual income tax to the state, so your credit would offset that amount but also be limited to that amount.   Check with your Enrolled Agent for the details and dont miss this one, it is not often that you can get this kind of bonus when buying a home.    

In order to capture one of the best government give a ways called the home buyers Federal Tax Credit up to $ 8,000, you must enter a contract by April 30th, 2010.  Dont panic you have until July 1, 2010 to close and still receive the credit.  The way the tax credit works is, it is calculated based on up to 5 % of the sale price.  So a $ 100,000 purchase would award a tax credit of $ 5000.  A $200,000 purchase would allow up to only $ 8,000 because 5 % exceeds the maximim credit of $8,000.   Talk to you Enroll Agent Tax professional for details on filing and recieving this credit.   Another good point or not, many ask if you can use this as a down payment today, and the answer is no, however look at it as a rebate that you will later recieve after you file you 2010 return.   Dont miss out on this one, if you are not in contract yet, hurry the clock is running out.

Studying history can be a great way to deterine the future, especially when it comes to economics.  As our data bases grow over time I believe the information will be a great tool to deterrmine the buy and sell cycles of real estate.  If you were to study our economic cycles it is difficult to determine the exact year of the top or bottom of a market cycle but it is possible to see one coming.   In a study of today's market and Fannie Mae's recent report of future loan activity, it appears that we are at our near our bottom of the market.  As builder inventory shrinks, the existing inventory in the market, will be where buyers will need to look to buy a new home.  Demand will slowly build over time, as long as employment and consumer confidence in the market stays positive.  Based on the previous two economic cycles the bottoms were about 1996 and 1985.  In this last cycle the peak of the market was 2005 - 2006 and the market corrections usually last 2-3 years, then a bottom and slowly recover over the next 2-4 years.  In our capitalistic society our greed driven agenda's will .again push our markets to greatness.  Millionaires are made at the bottom of a cycle.  We are in the vortex of the bottom of the market, the best Buyers market we have seen since the last one in 1995 - 1996.

It is common today for motivated sellers to pay up to 3.0 % for closing costs for either a FHA or Conventional Loan.
FHA allows up to 6 % for Closing costs and Conventional loans vary based on the down payment.    For down payments less than or equal to 5 %, the maximum credit is 3.0 %  A 10 %  or more down payment allows up to 6.0 % and a down payment of 20 % or more will allow up to 9 %.   Closing costs consist of Lender, escrow and reserves for property tax and home insurance (impounds).  

As of Jan 1st, 2009 FHA has changed its down payment requirement for the first time in more than a decade.  The new down payment is slightly higher than previously.  It has increase from 2.85% to 3.50%.  FHA still allows 100% or a portion of the down payment and closing costs to be a gift from a relative. 

Cal Housing Finance Authority
California's Down Payment Assistance program is put on hold as of December, 2008.  This bond program is put on hold due to a very weak bond market and declining values.   This program allowed buyers to borrower the down payment for FHA's , minimum down payment and closing costs.

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