In Orange County, CA, condo’s are everywhere. But until the new HARP 2.0 refinance program in 2012, it has been nearly impossible for condo owner to refinance. And even for those that would, the “Loan Level Price Adjustments” effected loan pricing so much, that refinancing didn’t seem to make sense. But with the HARP 2.0 program, not only is property value not an issue, but Loan Level Price Adjustments are held to a minimum.
Orange County Condo Owners Refinance Program
The HARP program seems perfect for many condo owners who are underwater on their home. They can refinance, even if their FICO is pushing 620, and even if the condo is now a rental property. Also, many condo owners are finding that with interest rates so low, a 15 or 20 year fixed loan program is possible with only a minimal payment increase, if not an actual payment drop, on top of paying off the loan many years early. In Orange County cities like Irvine, and within communities in Irvine like Woodbridge, Turtle Rock, University Park, and Westpark, condo owners have all but lost out on the low interest rates available over the past few years. Now, those Irvine condo owners and investors can refinance and save hundreds per month.
Example of Typical Savings for Orange County Condo Owner
In an example of a typical situation, let’s say Johnny Irvine bought a condo for $500,000 in Irvine in 2008. At the time, 30 year fixed rates were 5.5%. His original loan amount, which closed in March 2008, was $400,000. His payment has is currently $2,271, and after four years, his current loan balance is down to $376,553. He would love to get out of the 5.5% interest rate, but his Irvine condo is now only worth $350,000, which is less than he owes. But now, with the HARP 2.0 program, he can refinance to a low rate. While he know he can pay closing costs in order to get the rate as low as possible, he decides to go with a “No Cost” refinance, where the closing costs are paid for using lender credit, and his loan amount does not increase with financed costs. If Johnny is able to get a rate at 4.5%, his new 30 year fixed payment would be $1,907. That is a savings of $373 per month. He could also go with a 20 year fixed at a slightly lower rate and take several years off his loan. It really just depends on what Johnny’s long term plans are with his condo.
First Step in Qualifying for Orange County HARP 2.0 Refinance
The first step in qualifying for a HARP refinance in Orange County is to contact a lender who can go through your options. The loan officer should be able to determine whether your loan is owned by Fannie Mae or Freddie Mac. He can also check credit and work on the initial Automated Approval. It is also important to see a Side by Side Analysis which compares your current loan to the HARP Refinance loan options. Processing for these loans is actually fairly fast, depending on the HARP lender you choose.
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