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I'm refinancing with HARP 2.0. I have a 30 fixed rate with Lender Paid Mortgage Insurance (LPMI), which is "Lender Paid Monthly". I was unable to refinance, up until now, due to no lenders offering to refinance with LPMI under HARP. - I'm underwater by about $50K.
So, about a week after the HARP 2.0 guidelines came out (3/23/2012), a broker I had talked to earlier called me and told me about the new guidelines, and that she had a lender that was willing to refinance my mortgage with LPMI. = Great!
So I got the GFE with no MI listed on it. I asked the broker how the LPMI was being handled and she told me it would just be transferred to the new loan. It seemed weird to me that I wasn't being charged anywhere for MI (no interest rate increase - like I have on the original mortgage), but great - no MI. I signed everything - and it was going through the process, until I received a new GFE on Friday that now lists PMI, along with a letter explaining the reasons a GFE can be modified, and that the reason for this change is "Program Change".
I talked to my broker, and she said that they didn't know it was "Lender Paid Monthly", and thought it was some other type of LPMI. And according to HARP 2.0, "Lender Paid Monthly" has to be converted to borrower paid MI, so the GFE had to be changed.
My question is: is it legal for them to change the GFE for this reason? To me, it doesn't look like this a valid reason to change a GFE - this looks like their mistake to me, not an "Act of God" or anything that was out of their hands.
I'm refinancing with HARP 2.0. I have a 30 fixed rate with Lender Paid Mortgage Insurance (LPMI), which is "Lender Paid Monthly". I was unable to refinance, up until now, due to no lenders offering to refinance with LPMI under HARP. - I'm underwater by about $50K.
So, about a week after the HARP 2.0 guidelines came out (3/23/2012), a broker I had talked to earlier called me and told me about the new guidelines, and that she had a lender that was willing to refinance my mortgage with LPMI. = Great!
So I got the GFE with no MI listed on it. I asked the broker how the LPMI was being handled and she told me it would just be transferred to the new loan. It seemed weird to me that I wasn't being charged anywhere for MI (no interest rate increase - like I have on the original mortgage), but great - no MI. I signed everything - and it was going through the process, until I received a new GFE on Friday that now lists PMI, along with a letter explaining the reasons a GFE can be modified, and that the reason for this change is "Program Change".
I talked to my broker, and she said that they didn't know it was "Lender Paid Monthly", and thought it was some other type of LPMI. And according to HARP 2.0, "Lender Paid Monthly" has to be converted to borrower paid MI, so the GFE had to be changed.
My question is: is it legal for them to change the GFE for this reason? To me, it doesn't look like this a valid reason to change a GFE - this looks like their mistake to me, not an "Act of God" or anything that was out of their hands.
Thanks in advance for any advice.
So you want to stick it to them for taking on your complicated/shakey deal? Nice. This is why I would have immediately turned your deal down and informed you that you should contact your current servicer.
There's nothing shaky about the deal. Sorry if I made it sound like I was gonna stick it to them - not necessarily, I was just looking for an answer to the question of if they're pulling one over on me. I realize the regulations about changing a GFE is there for a reason - because brokers and lenders have been screwing borrowers... Hence my apprehension with the deal I have going on, and the question I am asking.
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