I'm one of the lucky ones, who's eligible to refinance under the initial HARP guidelines. We were nervous about the appraisal, but that value came in okay. So we're proceeding to refinance with Wells Fargo, who currently hold our mortgage.
After we initiated this refinancing, the Obama administration announced changes to HARP, to remove the LTV requirements, and (if I understand correctly - please correct me if I'm wrong) to insure title to such extent that other banks would be willing to refinance loans which they did not originate. So if my refinance falls through, I'll take it to a local credit union in a few months, after the new rules have been implemented. So I feel empowered to question anything WF is asking me to sign.
Which brings me to my question, under the squiggle.
There's a new form called 'Statement of Occupancy'. It wasn't in the package when I purchased the home. Now it's here, and we believe that a reasonable person could find us in default on the mortgage if we rent out the property at any time in the future.
Can y'all give me an opinion on this? Am I on-track or off-base?
The form states:
I hereby acknowledge and understand that I am executing this Statement of Occupancy which provides that if my loan application on the above described property is approved, I will occupy the same as my principal residence within sixty (60) days of the loan closing.
It is understood and agreed that:
a. You intend to sell the Note to an investor;
b. You would not make the loan unless you are able to sell the Note; and
c. The Investor would not buy the Note unless I occupy the property as my principal residence.
I further confirm my understanding and agreement that if I fail to occupy the property as my principal residence as provided above, such failure shall constitute a default under the terms and conditions of my loan, and upon the occurence of such default, the whole sum of principal and interest shall immediately become due and payable at the option of the holder of my Note.
You have advised me that you intend to sell said loan and that you may not be able to do so or may be required to repurchase the same and may be damaged in certain other respects if I fail to occupy said property as my principal residence as provided above. This will also confirm our agreement that I shall indemnify you and hold you harmless from and against any and all loss, damage, liability or expense, including costs and reasonable attorney's fees, to which you may be put or which you may incur by reason of or in connection with my failure to so occupy said property as my principal residence as provided above.