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April 7th, 2009

DU Refi Plus Update



We’ve had a lot of reader interest regarding our story “Fannie Works to Streamline Refis.” The post, written in early February, discussed Fannie Mae’s latest strategy designed to speed up the refinance process by expanding the criteria for eligibility (i.e. reduced FICO requirement) by reducing the amount of documentation (such as employment information) required by lenders, even waiving an appraisal in some cases.

Given the amount of interest, we figured an update on the program would be in order.

The latest version of the Desktop Underwriter (DU), available on or after May 2, 2009, will accommodate the latest enhancements of  the DU Refi Plus program in accordance to the president’s Home Affordable Refinance initiative. The most significant enhancement will accept Fannie Mae loans with an LTV of up to 105%.

Click here to determine if you are eligible for the Home Affordable Refinance program. For additional information, be sure to read the program’s FAQs.

See what our readers are saying: read the comment section of our original post as we’ve done our best to answer our readers’ questions and comments regarding the DU Refi Plus program.

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22 Responses to “DU Refi Plus Update”

  1. Kevin S Says: April 8th, 2009 at 8:06 pm

    Are any lenders accepting this program? I have read the Fannie Mae guidelines and adjusters but I expect the banks to have overlying adjustments as well.

  2. Tim Manni Says: April 9th, 2009 at 12:24 pm


    Yes the program is underway, they have even made updates to the program which will go into effect May 2, 2009 (Fannie will accept loans with an LTV of up to 105%). If your loan is owned by Fannie Mae, you should have no problem.

  3. Sarah Says: April 21st, 2009 at 1:56 pm

    I’ve been talking to some lenders, but no one know the complete details of the program. We would have to wait until May 1st. Does anyone know if a person would qualify if they have a second mortgage?

  4. Tim Manni Says: April 21st, 2009 at 3:20 pm

    Hello Sarah,

    This is directly from the refinance program’s FAQs:

    (Question 6) I have both a first and a second mortgage. Do I still qualify to refinance under Making Home Affordable?

    (Answer) As long as the amount due on the first mortgage is less than 105% of the value of the property, borrowers with more than one mortgage may be eligible for a Home Affordable Refinance. Your eligibility will depend, in part, on agreement by the lender that has your second mortgage remain in a second position, and on your ability to meet the new payment terms on the first mortgage.

    Here’s that link http://www.financialstability.gov/docs/borrower_qa.pdf

    According to http://www.makinghomeaffordable.gov/refinance_eligibility.html (the gov’s website which helps determine eligibility), “This site can help you determine if you are eligible, but only the servicer of your loan can tell you if you qualify. Please contact your servicer for more information.”

    I hope this info was of some help. Thanks for reading and commenting,

  5. Tom Says: April 22nd, 2009 at 3:10 pm

    Does the program work if you are trying to refi with another lender? What about Freddie Mac loans?

  6. Tim Manni Says: April 22nd, 2009 at 3:44 pm

    You are eligible for this program if your loan is owned by Fannie Mae or Freddie Mac only.

    For more info be sure to read the program’s FAQs.


  7. Naj Says: June 2nd, 2009 at 9:24 am

    We qualify for this on a 2nd home, however the lender is not wanting to charge us 3 points. Does this sound right?

  8. Naj Says: June 2nd, 2009 at 9:26 am

    The lender is now wanting to charge us 2 extra points even though we locked in already.

  9. Tim Manni Says: June 2nd, 2009 at 10:05 am


    I’m confused, the lender does or doesn’t want to charge you points — you say both. While it’s hard to make a judgment based on the little info I have, if the lender does want to charge points, it’s likely a reflection of your credit score or current LTV.

    If your loan is through Fannie Mae, they want you to stick with your original lender. If it’s with Freddie Mac, then you can shop around to find a better deal, one that may charge less, or even no points.

    Thanks for commenting, let me know if you have anymore questions,

  10. Michael Says: June 5th, 2009 at 11:57 am

    I am having issues getting PMI on the refi plus. For example.. the current loan has PMI.. now UW want them to get new PMI which we all know is difficult.. how are the 105 LTV getting PMI

    Any help?
    Thanks in advance

  11. Tim Manni Says: June 5th, 2009 at 12:00 pm


    I’m looking into this and I’ll let you know as soon as I find some info.

    Thanks for commenting,

  12. Jim Says: June 9th, 2009 at 6:12 pm


    Did you ever find a answer for the question Michael asked?



  13. Tim Manni Says: June 10th, 2009 at 1:40 pm

    Hey Jim,

    A couple of us over here are digging around websites and original documents looking for some concrete answers. We should probably write another post due to the continued interest on the DU Refi Plus.

    I’ll be sure to let you and Michael know when we find it out.


  14. Tim Manni Says: June 10th, 2009 at 5:02 pm

    Jim, Michael —
    I’m sorry it has taken me so long to get back to you both.

    Here’s where to find the info on PMI in accordance to the DU Refi Plus Program:
    https://www.efanniemae.com/home/index.jsp (click on the ‘Home Affordable Refinance FAQs’ on the
    upper left-hand side — start with #24) and from
    http://www.freddiemac.com/sell/factsheets/relief_refi_faq.html (scroll down to numbers 39-46).

    Here’s what we interpreted: Fannie and Freddie are expecting mortgage insurance companies to honor
    their agreements with the borrowers. The policies should transfer right over — either the borrower
    gets a continuation of their old policy, or there’s an issuance of a new policy which directly
    resembles the terms and conditions left from the old policy.

    I hope this info is of some help, contact me if you guys have any more questions. Thanks, and again sorry it took me so long,
    Tim Manni

  15. Mikey Says: July 16th, 2009 at 7:48 pm

    Hello Tim,

    I have been working with an existing lender who currently furnishes my existing loan. I qualify for the DU Refi without PMI however my LTV is at 94% Based on all I could read on the web and various articles my interpretation was that the DU Refi would allow us to basically capitalize on the low rate due to the market conditions. However, I am a day away from closing and have been quoted with closing costs of $6900. $2009 will get credited back but that still forces me to pay about 4900. The 180 dollars a month in cost savings makes no sense as it takes 4 yrs to recoup. I cant understand why they are truly penalizing those of us who would like only to capitalize on the low rate. The lenders need to quit trying to capitalize even when the govt is allowing them to do business.

  16. Tim Manni Says: July 17th, 2009 at 9:32 am


    Thanks for commenting. Those costs may be specific to your given lender, I can’t say for sure. Closing costs usually account for about 2% of your loan. If you got a real low rate, your lender may have charged you more in fees. If your credit isn’t that good, that could also add to fees.

    “The 180 dollars a month in cost savings makes no sense as it takes 4 yrs to recoup.”: I hear you, many borrowers have decided that it doesn’t make sense for them.

    “The lenders need to quit trying to capitalize even when the govt is allowing them to do business.”: This could be one of the reasons why the govt refi programs haven’t been as effective as they hoped.

    Best of luck Mikey, thanks for commenting, we hope you visit us again soon, thanks,

  17. Paula Says: July 31st, 2009 at 5:22 pm

    Hi, I am trying to take advantage of the refi program.
    I have a Fannie loan. My servicing company sent me a letter stating I have a Fannie loan. Fannie called me and said I have a Fanny loan. However … since I do not appear in the Fannie data base I cannot get an investor to do my refi. According to Fannie’s FAQ it is possible that because I live in a condo I may not be in the data base.
    So .. now what. I asked Fannie for a letter and have not yet received one. I called again today. It takes Fannie
    a week to call back and if you miss the call … well then
    you get to start over!!! HA HA HA .. I called my senator’s office and they want to open a congressional investigation.
    Any ideas?? Frustrated in Denver

  18. Tim Manni Says: August 3rd, 2009 at 11:54 am


    A few things: How could Fannie call you or confirm you had a Fannie loan if you’re not in their database. Even if they were returning your call, for them to determine if you have a loan with them, you must be in their database. Are you sure it was Fannie that called? They’re usually not in the biz of calling consumers.

    And wow, frustrating indeed! This is the first we’re hearing about this condo thing. Can you send us a link?


  19. Atif Says: September 12th, 2009 at 2:19 pm

    I am trying to refinance via DU Refi Plus and does not have an MI on my loan (I had the MI originally on my loan but was removed last year once my LTV became 80%). My LTV as per current market conditions is 90%. The problem is that when my new lender tries to qualify my loan via DU desktop application, it gets the message that I need to have an MI on my loan where as under RefiPlus if one does not have an MI on the current loan, it should not have to pay MI. I have contacted my current lender who has verified that I do not have an MI and tells me that it is an issue with Fannie Mae database (they even submitted another update request a month ago). But when I contacted Fannie Mae, I got multiple answers from different representatives depending upon who is returning the call. Some has told me that the message in the DU findings is just for information and the new lender should be able to refinance without MI (my new lender is not the same my current lender and is not willing to proceed until that message is removed from the findings) and others have told me that as the information is taken from the current lender, in their system, the information is not updated.
    I am wondering if this is happening to others and if there is a way to get it resolved?
    Is there any way to get it sorted out, it is almost three months going back and forth between Fannie Mae, new and current lenders.
    Thanks for the help.

  20. Tim Manni Says: September 14th, 2009 at 1:32 pm


    First off, thanks for commenting and sharing your story. I’ll look into it, but these “hangups” usually preside on the lender side of things — as you probably already know. This computer system/software/application — whatever you want to call it — is just that. I have heard many similar stories about these computer glitches. That’s one of the reasons why ‘Plus’ was so delayed in the first place, they wanted to give lenders ample time to implement and learn the software.

    There are so many Americans trying to do what you are doing that banks and lenders are overwhelmed. I know this doesn’t provide you with much, but we will look into to see if this is a common problem.

    Keep us posted, hope to hear from you soon.

    Good luck,
    Tim Manni

  21. Robert Says: August 25th, 2010 at 11:53 am

    Here we go again with loose underwriting guidelines. Did Fannie Mae not learn anything the last time around?

  22. shankar Says: December 8th, 2011 at 11:54 am


    I have Lender’s PMI on my mortgage laon. When I contact my current lender (bank of america) they said I am not eligible for Refi-plus program because I have lender’s PMI. Is that true.In one of the above reponses, you mentioned that (from FAQs) PMI will be tranferred or new plocy will be issues. But how about LPMI. Could you please throw some light on this. Recently Fannie has made some modifications to Re-Fi plus program so I want to make sure I am eligible for this or not.


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HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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