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January 5th, 2011

Reader: I succeeded in refinancing with BofA!

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BofA I try to be as journalistic as possible on this blog. One of the ways I strive to do so is by presenting both sides of the story. We’ve read comments and published posts that call out the many frustrations borrowers have experience with Bank of America when trying to either modify or refinance their loans. Up to this point, not one comment on this blog or one news article that I’ve read sang the praises of the country’s largest lender. Like I said…until now.

One of our readers, “Steve,” recently shared a comment with us that said his BofA refi was “the best New Year’s present [he] ever had in [his] life.” Here’s Steve’s story:

My current servicer, BofA, approved my [Making Home Affordable] HARP today at 4.5% for 30 years. My old rate was 5.8% for 30 years. It was funded today. Loan/escrow closed!!!

As a background, I have been the owner of a single-family residence in Los Angeles County since May 2008. Fannie Mae is the investor. I never missed payments or property tax. As far as I know, no approval was required since Fannie Mae had their own way of calculating the value of the home per my loan offer. I owed approximately $320,000. The value of home is $365,000. I signed the application in end of October. I paid a $450 application fee. If denied, I was going to get my money back. If approved, the application fee would be credited toward the closing costs. It took them only two months. The closing cost came approximately to $2,500 [which] was added to the loan. So all I paid [upfront] was $450.

What I did differently from other people, I guess, is that I pushed everyone involved in the process which included the loan officer, processor, closing agent and closing specialist. I literally called them twice a week and stressed how important this was and that I wouldn’t be able to make any payment if this doesn’t go through. Maybe I got lucky with good people, but the loan officer I was dealing with specializes in MHA HARP and was very knowledgeable in this program. He pretty [much] had answers to all my concerns. As far as I know, your debt to income ratio doesn’t matter. Per the loan officer, as long as you work, you should qualify. It’s all about if you are currently working or not.

Don’t lose hope. It is possible. This is the best New Year’s present I’ve ever had in my life.

Good luck

While I don’t doubt that Steve’s diligent persistence in communicating with BofA helped to push his refinance along, there are other factors which I believe helped him succeed when so many others have failed. While we can’t fully understand Steve’s entire situation just based on the comments he left, judging by the loan figures he has quoted above, it’s easy to see that Steve’s loan is NOT underwater.

In my experience — the articles I have read, the readers I have talked to — getting a HARP refinance is especially difficult if you’re underwater, even though the program technically qualifies borrowers with loan-to-value ratios of up to 125 percent. (For more on this, be sure to read our post “Are the wrong borrowers refinancing through HARP?“)

We want to learn more about your refinance and modification experiences. Have they been marred by trials and tribulations, or do you have a story of success? Either way, we’d love to hear your story — please feel free to leave a comment below.

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5 Responses to “Reader: I succeeded in refinancing with BofA!”

  1. Matt Says: January 6th, 2011 at 10:48 am

    I recently had a successful HARP refinance with Bank of American, although my situation was much different than Steve’s.

    I owed approx $245,000 on my prior loan which was a 30 year Interest-Only at 7.375%. The current Fannie Mae appriased value of my property was approximately only $194,000. I was on the cusp of 25% underwater. I failed at many attempts to have BoA refinance me under the HARP 125% LTV and even contacted my congressman to submit an inquiry on my behalf. Long story, but all to no avail. I spent nearly a year fighting that battle.

    In the end, they were willing to do 105% LTV so I pulled the trigger and refinanced at 30 years 4.75%. I was able to pay down the rest of my mortgage through third-party loans (not sure too many people will have this at their disposal).

    For those of you wondering, yes I did consider walking away, but in the end I plan to keep this property long term and, simply put, did not want to deal with the credit and legal implications of a default on my record.

  2. Tim Manni Says: January 6th, 2011 at 12:17 pm

    Matt,

    Thanks so much for sharing your story. I’m glad you succeeded in your refi! What made you more able to secure third-party loans as opposed to someone else? It sounds like the key was paying down the balance to get to 105% instead of 125%.

    What made BofA change their minds? Did you deal with the same or different reps as you went through the process?

    Thanks again for commenting, hope to hear from you again soon.

    -Tim

  3. Jim Campbell Says: January 27th, 2011 at 9:47 am

    I am a mortgage broker. I have heard many horror stories about the Making Home Affordable modification program. However, we’ve used the refinance portion of that program to help many people lower their rate and payments. I can’t speak for what happens at BofA, because they no longer work with brokers. But we have many lenders who close these loans without a problem, even if underwater. We’ve also had good results getting second mortgage holders to resubordinate. We only do loans in Illinois. Call us or talk to an experienced broker in your area. Lending guidelines vary widely between lenders. The program allows up to 125% LTV, but not all lenders will go that high.

  4. Tim Manni Says: January 28th, 2011 at 1:27 pm

    Hey Jim,

    Thanks for your insights. We’re glad to hear you guys have had significant success. Let me ask you a question, since you’ve had so many successful encounters with HARP, what are the most-common stumbling blocks for the who don’t end up refinancing through HARP?

    Thanks,
    Tim

  5. Tiffanie Says: March 14th, 2011 at 2:03 pm

    My husband and I are current with our mortgage and have been trying to refinance with BoA to lower our term and to cut our interest rate nearly in half and it is near impossible! I have been calling every other day to hear “we’ll close in 2 more weeks”. Well, 4 months later, we’re not closed. They have received our documents 4 times now within 24 hours of asking for them. I have already said we are looking for a new bank and closing all accounts with Bank of America.

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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

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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