Profile picture for dan30thz28

LPMI and TAMI--what's the difference? And why can't I refi under HARP?

Hello,
      I have a Fannie Mae backed loan that I'm paying .875% extra with TAMI--the loan is with Bank of America/Countrywide. We have excellent credit and were trying to refinance under HARP with them. They told me that I can't refinance with them because we have TAMI---but if it's Lender Paid Mortgage Insurance, then how can they get away with this for me and the millions of other who are underwater, and just want to refinance under HARP? All the research I've done on the internet says that TAMI is just a fancy program name for LPMI---which under Fannie's desktop underwriting system is okay to refinance under HARP. Please advise.
  • August 28 2009 - New Egypt
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Answers (8)

Just because it is OK with the agency guideline does not mean the lenders have to follow the guidelines to a T.  Many lenders have overlays on guidelines.  BoA no longer allows DU Refi plus loans if the loan had MI. 

FHA has no minimum credit score however most lenders have imposed a Min Fico of 620.  Lenders can and do add additional restrictions to agency guidelines.
  • August 28 2009
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LPMI- Lender Paid Mortgage Insurance
TAMI- Tax Advantage Mortgage Insurance

TAMI was just marketing by Countrywide, to make it seem like they were doing something no one else was. It does means the same thing as LPMI.

My problem with TAMI is/was that Countrywide would make you look at the examples of a mortgage with and without TAMI. They made it seem like a borrower disclosure that was in your favor. They were really just trying to sell you into a lifetime mortgage insurance contract. Very Slick wasn't it?

Your current refinance problem is brought on by greed. Countrywide and other lenders have kickback contracts with the MI companies. As an industry average the mortgage holder(BofA/CW) receives half of your monthly mortgage insurance premium or half of the extra .875% you pay. Refinancing your mortgage disturbs that backroom contract that nobody ever sees and was never disclosed to you.

Borrowers were mandated to look at TAMI before a mortgage at CW could be processed. CW made it seem like they were your friend. CW made it seem like they had a one of a kind offer. CW never goes out of the way to tell you about a lifetime of MI. CW never tells you about the extra margins/profit they pocket off of from the difference. To my knowledge CW is the only company that would make borrowers sign a document that they did not want LPMI/TAMI. Nice business practice and BofA couldn't wait to gobble them up.

The MI companies will tell you that it's just to hard to find the MI certificate and match it up. Blah, blah, BS. They find it for others. They should be able to find it for you and charge you the same .875% premium you paid when the mortage was originated.

The current refi-plus program is a joke that at the end of July only helped 46,000 homeowners nationwide since its debut April 1. That's only 11,500 qualified borrowers per month nationwide. You have a better chance of winning $50k from lotto than qualifying for this program. This program is a misarable failure, but good PR for the politicians.  Send Barney Frank a letter complaining. Inept politicians don't listen to mortgage professionals, but they do listen to consumers.
  • August 28 2009
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It is a shame that the government is promoting so many programs that the banks are not embrassing them as that is what our TARP money or tax payor money is there for.  I tell everyone to write their congress people and AG on this issue.  The same people are still running the banks and have not changed their bad behavior.  Unfortunately, the banks can really do what they want, lend or not lend in simple terms.  Yes, Wells Fargo just report record profits of 41%!

The whole lending industry is so convoluted with no real standards on lending that the banks are adhering to.  For the most part, all these new programs are just marketing ploys to either make the banks or government look like they are doing something and only helping thousands of people, which is not worth the marketing money they are all spending, as it is really not helping anyone!!

We now have BOA/Countrywide owning almost 50% of all banking in the U.S.  That should tell Americans alot right there.  That merger should have never happened as it has given one bank too much power over American's money.  And you can all see what is happening, as the government can't stop the speeding train.

I am in process of getting a inking a radio show for this very issue, which I hope will have a positive impact for the American consumer and their home loans.  My goal is to expose the banks even more on the facts they are not helping and lending to the American People.
  • August 29 2009
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Profile picture for mhammer2
well 2 years later and harp 2 finally comes out to help those who survived the crash with a house that is now work virtually nothing. however if you have TAMI added to your loan, banks won't consider refinancing you. unfortunately I was one of those who didn't even know they added it to my loan - thanks BofA. i'm usually so detailed when it comes to these things. i guess they figure they have insurance so who cares about anyone else.

anyone else in a similar boat. if so have you learned anything more, like a way around this or if other lenders are doing the same thing?
  • February 08 2012
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@mhammer2: I am n the same boat as you. I have found a local bank who is participating in the MHA plan for borrowers who have LPMI (or now I just found out also called TAMI). I have requested numerous times from Bank of Asses, I mean America to show me the disclosure. In my 86 pages from my closing, no where is there anything stating LPMI. What I also found out was that I closed on on March10th, 2008 and BofA requested the MI on my loan on March 14th, 2008, 4 days after i closed. The loan was sold to Fannie Mae on April 1st. I have filed a complaint with the OCC, FTC, my congressmen and write BofA, Brian Moynihan often. All I want is a lower interest rate. While I am being hopeful I can refi with my small, local bank, there is the chance I will be unable to. So I continue my quest, a little fish in a big sea. If I keep talking, someone will listen. 
  • March 12 2012
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Profile picture for dan30thz28
Well, I have great news! It turns out that after contacting my local senator (I was tired of these rejections), they told me that my lender had incorrectly reported my zip code to Fannie Mae (a ploy a lot of mortgage companies are using in my opinion to keep people from refinancing under HARP). I was told there were 14,000 zip codes the company (GreenTree Financial Services--a collection agency branch of Bank of America) would be updating as well. I was told the information would be updated as of July 14th. I contacted Lisa Stone at First Choice Bank in Maryland (they are a NJ based bank), and she told me she has already successfully closed a loan that had mortgage insurance through our PMI company MGIC. She ran our information through Fannie Mae and we got preliminary approval! We have a 30 year loan with a 4% interest rate, and no fees. We hope to close on August 17th Lord willing.
  • August 03 2012
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Congrats Dan!   3 years is a long time to refinance.

LPMI transfers have become very easy with HARP 2.0, there are many lenders willing to take the reissued certificates and the most of the insurance companies are very organized on providing what is needed to allow for this.

To use a new servicer you must get the eligible match in Fannie Mae software and the data integrity must be accurate for the software to allow it.  I wouldn't quite call it a ploy, more like disorganization.

Either way, glad you got it worked out.
  • August 03 2012
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Profile picture for dan30thz28
Hello,
I'm free of Greentree! I'll be saving over $780 a month with this loan, and we closed on the 17th. Thanks for all your advice, things couldn't have worked out better!

Sincerely,
Dan Maldonado
  • August 24 2012
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