What is Refi Plus from Fannie Mae?
Fannie Mae introduced their Refi Plus program in conjunction with the Home Affordable Refinance Program or HARP. This program is available for Fannie Mae to Fannie Mae refinances. If the home has an existing Fannie Mae loan and there is a significant benefit for the borrower, the new Fannie Mae loan would be eligible for this program. It allows for loan to values (LTV) of up to 125 percent of the home's value for a servicer and up to 105 percent for a lender. The purpose is to put responsible borrowers into a more affordable payment or take them out of "riskier" loans, such as interest only loans or short-term adjustable rates. The idea here is to provide a benefit to the borrower and in essence reduce the risk to a default on a Fannie Mae mortgage.
In my opinion, it is an excellent program for borrowers who qualify under the above-mentioned basic guidelines. Each investor offering these products may have their own overlays to qualifying under this program, but it many instances, a home may be eligible without an appraisal. There is an option in the delivery of this new mortgage to take advantage of a property inspection waiver (PIW).
I have a few clients who were able to take advantage of this, and all of them were pleased in getting a new lower interest rate and not having to shell out for an appraisal, all the while hoping that their home value didn't tank in the past year.
Check this link for more info from the Fannie Mae site: https://www.efanniemae.com/sf/mha/mharefi/