What is the Michigan Fannie RefiNow Mortgage?
This new refinance program is being implemented by the FHFA to target the 2+ million low-income borrowers who were not able to take advantage of 2020’s low refinance rates.
Michigan RefiNow is intended to help non-refinanced borrowers save $1,200 – $3,000 a year on their mortgage payment. When meeting specific requirements, the agency will also waive the adverse market fee for borrowers.
RefiNow Loan Product Available Starting June 7th, 2021
What are the Benefits of the Michigan RefiNow Loan?
The FHFA will set guidelines that require lenders to follow. In return, this will provide the borrower:
- At minimum, a savings of $50 per month and lower the borrowers interest rate by at least a 50-basis point.
- A $500 credit on their appraisal if the borrower is not eligible for an appraisal waiver.
- Skip 1-2 Mortgage Payments
- Receive cash back from your current escrow account.
- Save thousands in interest over the life of your mortgage.
Do I Qualify for the Michigan RefiNow Program?
To be eligible for the RefiNow mortgage program you must qualify for the expanded qualification guidelines. After applying for a mortgage, your loan will be reviewed by an underwriter to confirm you meet the following:
- Must quality for Fannie Mae Conventional Loan guidelines
- You must have a single family, one unit, government backed, loan that is occupied by the owner.
- If you have missed any payments in the last 6 months or have missed more than one payment in the past 12 months, this could disqualify you.
- Income must be at or below 80% of the area median income.
- The borrowers LTV (loan-to-value) cannot be greater than 70%.
- DTI (debt-to-income) should be above 65% or have a FICO score lower than 620.
For more information read Fannie Mae New Refinance Option press release for June 5th, 2021.
What is the “Adverse Market Fee” and can it be waived?
The adverse market fee was implemented in December 2020 and was originally created for risk management in response to the global pandemic.
- The fee is a 0.5% fee that is charged to refinances that are sold to Fannie Mae or Freddie Mac. To put it into perspective, this amount equals about $500 per $100,000 you borrow.
- To qualify for the waiver, the borrowers loan balance must be at or below $300,000.
“Racial and income disparities in refinance take-up rates have persisted for far too long,” said Sheila C. Bair, Chairwoman of the Board for Fannie Mae. “With this initiative, we strive to narrow the gap. We thank FHFA for its strong leadership to help all eligible homeowners reduce their monthly housing costs by taking advantage of the historically-low mortgage interest rates.”
Is Now a Good Time to Refinance my Mortgage?
If you own a home then refinancing now may be your last chance to take advantage of some of the lowest mortgage rates in history. One of the purposes of this new refinance program is to allow homeowners to lock in low rates now before they go up. Fannie Mae urges low to middle income homeowners to refi now before it is too late.
A Remortgage is through RefiNow may be quicker and easier than a standard home purchase loan. With expanded guidelines and the opportunity to drop your rate with no appraisal required, you may be able to close in as little as two weeks.
How Do I Apply for the Michigan RefiNow Mortgage?
You may apply for a RefiNow mortgage or check eligibility by submitting your information below or calling a licensed loan officer at (800) 555-2098.