Profile picture for carter_s

At this point would a Loan Modification be better than a HARP 2.0 refinance?

I meet the criteria.  In the process of a Loan Mod, but it is taking forever, and WF keep giving me the run around.  I am not sure if I will make out better to do the HARP 2.0 refinance or continue with the Loan Modification.  Please advise.
  • January 31 2012 - Manassas
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Answers (9)

Profile picture for KKSka14
Well, we do HARP 2.0 loans in Virginia (taken onto our portfolio--although, I think a lot of lenders do). If you just need a lower payment then go with HARP as it won't ding your credit (although it won't reduce your principal balance). There are some unsolicited loan mods for when an investor is trying to reduce their portfolio's risk, but a requested loan mod will hammer the credit. A loan mod may take "forever" if there is no pressing need for it given how hammered the servicers are with requests from people who have lost their jobs or who can't afford their payments.

Edit: If I'm not mistaken--and I may be--there is even a big ding to your credit score for even requesting a loan mod.
  • January 31 2012
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Profile picture for carter_s
Yeah Short Sale is not an option, we live in the home.  My home is underwater, but either a Mod or a HARP refinance will help.  I am just trying to figure out which would be the best.  I haven't been late, on my payments.  My interest rate is very high.  which contributes to a high payment.  If my payments were to be reduced things would be fine.  Or shall I say manageable.
  • January 31 2012
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Profile picture for sunnyview
"Short Sale! Get the elephant out of your life!"

I think that advice is terrible. This owner has not even said if they are underwater, what state they live in or whether a loan mod/HARP will help their long term situation without damaging their credit.

You enthusiastically recommending short sale out of the gate is just not right.
  • January 31 2012
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Profile picture for KKSka14
Depends a lot on your situation. If you plan on staying at the house long-term then a loan mod may be a good situation if they reduce principal. If you are perhaps considering a move in the next few years then please keep in mind that a loan mod can hammer your credit score. It may be a small price to pay but just remember that there are consequences for loan mods.
  • January 31 2012
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Short Sale! Get the elephant out of your life!
  • January 31 2012
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Profile picture for sunnyview
I think it probably depends on what the terms of the loan mod are. Many of them add principal to the back end or lengthen the term to drop the payment. Rates for 30 year mortgages are very low right now so I would see what your payment with HARP would be.

Talk to a local WF lender in a branch. I would try to shoot for whatever will give you a term of not more than 30 years and a payment that leaves the possibility of keeping it as a rental open for the long term. That way even if you have to relocate for work or your circumstances change you can hang on to it no matter what the market is like and choose when you sell.
  • January 31 2012
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Profile picture for carter_s
Thanks for the responses.
  • January 31 2012
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Here is some information about HARP eligibility.  Take a look.  I hope this helps and good luck.

Thanks,
Candace
Zillow Customer Support
  • January 31 2012
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The answer depends on a lot of things...  the very best suggestion I can give you is to consult your mortgage broker and have the "expert" run the numbers to give you the pros and cons.

Good luck!
  • January 31 2012
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