Comparing Short Sales and Harp 2.0 refinancing for Florida Homeowners.

As I work with borrowers I am not just interested in what rate I can get them or what will be their new payment. I am more interested on their financial health and long term plans.

First let me disclose that I am not an attorney or financial planner but as a mortgage and real estate broker for the last 13 years, I have learned quite a bit about real estate and finance and can provide information to help homeowners that are underwater on their home or investment property. With this information the borrower can make the best choice for themselves instead of someone giving limited information and directing the owner on what to do.

Short sales

Short sales are popular today especially in Miami, Florida and other major cities around the US. With the end of the tax forgiveness ending at the end of 2012, this may not be available as an option to homeowners and we will find more foreclosures on the market. Those borrowers that have been paying on time usually will not qualify for a loan modification and do not want a short sale taking a risk the lender will record a deficiency judgement on their credit. This is not an option I recommend to anyone that is current on their mortgage and avoid a black mark on their otherwise good credit. This is "usually" for those that can no longer afford to make their payments and need to sell for less than the mortgage amount and start their life over in a cheaper home. At least with a short sale, the owner can possible buy another property in the near future.

So what is left for investors and homeowners that have been paying on time and can continue making payments but find it unfair that their investment condo or primary home has a higher rate than everyone else?

HARP 2.0

If the property is owned by Freddie or Fannie, your income is stable and you have been making your payments on time, then chances are you qualify. As I mentioned before, if after an interview I believe a new loan is not in their best interest then I will suggest not to refinance. You asked when can that be possible? Let me explain with an example.

Example #1(Not a benefit) Borrower has an investment condo located in Fort Lauderdale Florida. I was able to lower the interest rate and payment about 30% but I needed to extend the loan out again for the original amount of years of the current mortgage. In theory this sound great but it wasn't. The borrower owed just a tad over what the investment property was worth and planned on selling within 5 years. The property is in the 7th year of amortizing and a good chunk of the principle was being paid off with the current monthly payments. It would take 18 month to realize the savings in the monthly payment to recover the increase in a new loan. I saw this was not in the best benefit of the borrower and turned down the loan. After explaining why, the customer realized I was correct and thanked me.

Example #2(Huge Benefit) Borrower has a primary residence in Hialeah Florida. Current rate with lender is few points higher than current rates and allowed me to refinance them into a shorter time AND a lower monthly payment. I shaved off several years off their mortgage and a substantially lower monthly payment. A Win Win for both the borrower and the bank.

IF you need any information regarding the HARP 2.0 program or ANY financing including FHA or Conventional and Private money, please contact me for a free consultation.

NOTE: I am licensed in all of Florida therefore I can originate any loan as long as the property is located in the state of Florida. Your primary license can be anywhere in the US.

I specialize in Condos regardless of value.