Short RE FI Program

Home 2 Home has created a team of modifiers and mortgage specialists to assist homeowners who are current in their mortgage payments, still gainfully employed with money in the bank and credit intact.  These borrowers are simply up side down in current value of their home

In many cases these owners are ok today but in the future may experience mortgage stress.

For these borrowers a refinance is unavailable as their current home value has dropped so far in today's market that obtaining a new loan without coming up with additional monies to pay off the lost value of their home to obtain current at value mortgage.

The only relief for these borrowers is to proceed with a short re-fi.

A short re-fi is a short sale to the homeowner living in the home.

Short re-fi's were originally referred to as write-downs under traditional financing under both FHA and Conventional.  In essence the mortgage holder would "write down" a portion of the loan amount to allow a sale to take place between buyer and seller where a home did not increase in value enough to actually see the seller recognize a profit and have monies available to complete the sale transaction.  This has been the case in many parts of the country that do not see significant increases in value over long terms of time.

Short re-fi's are new to the current economic conditions and represent the easiest fix for mortgage companies and something that seem likely to do.

Short re-fi's require multiple steps to complete, consisting of a loan modification to lower the existing principal loan amount and a new loan.

It requires additional steps and therefore costs more money than a loan mod.  But for owners who do not want/need/qualify for modification this is the only method to lower principal loan amount as well as lower payment, correct IO  and ARM loans and correct crazy mortgages.

The total cost to accomplish all the steps of a short re-fi is $3995

This covers

The cost of negotiating the short pay off with current lender. 

Same process and work load as modification.

Acquisition of new FHA loan

Additional fees may be incurred as part of the loan process depending on lender requirements which may include the

Appraisal                   $350

Credit reports            $75

Just like the modification process we actually break these activities into several payment periods based on success of each step.

Step 1             $1500             This is to verify that borrower will qualify for the loan and the lender will accept the short payoff.  Homeowner will complete all the applications for loan modification as well as complete entire mortgage application.  This money is paid up front

If additional appraisal and credit reports are due these monies will be due at this time.

Step 2             $1495             Upon approval of borrowers mortgage application we will finalize the loan modification process and obtain the at value price for the pay off of the current loan to finalize the short re-fi process. This money is due at this time.

Step 3             $1000             Due upon closing of the loan between the old lender and the new lender.

There are several bail out points as lenders do not always follow through with what they commit to in all modifications.

Unfortunately there are expense costs incurred on behalf of the homeowner along the way in obtaining a short re-fi.

If we are unable to acquire a new loan for the homeowner they will be refunded the $1495.

If a short re-fi is not realized Home 2 Home will credit owners who find themselves in distress $1500 towards a loan modification.

In order to more fully understand the process here is a list of the information that is required.

STEP 1:  We will require the following documentation to get you approved for your new loan.

            Documentation Needed

1. Signed Fee Agreement, Authorizations and Statement of Information.
2. Copy of Driver's License & Social Security card.
3. Copy of most recent mortgage statement or statements for all properties.  
4. Copy of all legal notices or letters received from lender.
5. 30 Days Most Recent paystubs for all borrowers (we will continue to need the most current pay stubs until the loan funds)
6. Copy of 2007 and 2008 tax returns and w-2's for all borrowers (if you are Self Employed, most recent 2 years 1040's and all schedules).  Complete copies.
7. 2 months bank statements (all pages) (If self employed, complete bank statements for all months of current year)
8. If Self Employed, Current Month To Date Profit and Loss signed by CPA
9. Copy of the note(s) 
10. Hardship Letter (if applicable)
11. Copy of homeowner's insurance
12. Any medical bills or information if medical hardship
13. Notice of Cancellation Acknowledgement
14. Pre-Qualification submission form
15. Application fee of $400 (cashier's check, certified funds, wire or cash only)

STEP 2:  Once we receive the information listed above and our research and analysis is complete, we will prepare and submit your file to our lenders for loan approval.  Once approved, we will then have our FHA appraiser set an appointment with you for the appraisal.  This will take 4-7 days to complete.  Once completed, we will then start negotiating with your existing lender(s) to accept our short pay offer.  This process will take 30-60 days.  Remember, we have a 100% money back guarantee AND we are 100% successful.  Remember during this period it is MANDATORY that you continue to make your mortgage payments on time.

Short re-fi's have been a part of the modification process from the beginning.  The principals of Home 2 Home prior to being home 2 home used this method in 2008 to assist homeowners in distress with results.  The drop in housing values along with economic conditions have saddled this option with low results but it is the correct fix for homeowners who are not in current distress, just up side down in value.