The Home Affordable Refinance Program (HARP) was developed for conventional Fannie Mae and Freddie Mac mortgages that have negative equity, or are underwater.
The REAL HARP program does not have a maximum loan to value (LTV), and was developed to refinance Fannie Mae and Freddie Mac conventional mortgages no matter how deeply a home is underwater. However, many lenders cap the LTV which does not help those severely underwater.
Lenders who do not cap LTV will be provided her and on the Help Network.
Hopefully, one day we can get a HARP-like refinance for non-Fannie Mae/non-Freddie Mac conventional mortgages!
Here is information regarding HARP compiled by the Federal Housing Finance Agency (FHFA):
What is the HARP Program?
When you owe as much or more on your mortgage than your home is worth, it can be difficult to find a lender willing to help you refinance. But for borrowers who have remained current on their mortgages, and have loans owned by Fannie Mae or Freddie Mac, there is hope. It’s called HARP.
As part of the Making Home Affordable Program, HARP was introduced in 2009 by the Federal Housing Finance Agency (FHFA).
Through HARP, you can get a lower interest rate (which means less out-of-pocket costs each month), get a shorter loan term, or change from an adjustable to fixed-rate mortgage. There’s no minimum credit score needed, either.
And now that HARP guidelines are simpler, even people who were formerly turned down may now be eligible for HARP refinancing.
How can HARP help me?
If you are current on your mortgage; have a mortgage that is owned by Fannie Mae or Freddie Mac, and owe as much or more than your home is currently worth, you may be eligible for HARP refinancing. That can mean significant savings by:
- Lowering your monthly payment
- Reducing your interest rate
- Securing a fixed-rate mortgage that won’t change over time
- Building equity faster—shorter term options may be available
- Lower closing costs because an appraisal is not usually required
HARP 2.0: Changes for the better.
New, simpler HARP guidelines are designed to approve more loans. And changes to the program itself mean that even if you were turned down for HARP before, you may now meet the requirements.
Important changes to the HARP program include:
- No underwater limits
Borrowers will now be able to refinance regardless of how far their homes have fallen in value. Previous loan-to-value limits were set at 125 percent.
- No appraisals or underwriting
Most homeowners will not have to get an appraisal or have their loan underwritten, making their refinance process smoother and faster.
- Modified fees
Certain risk-based fees for borrowers who refinance into shorter-term loans have been reduced.
- Less paperwork
Lenders now need less paperwork for income verification, and have the option of qualifying a borrower by documenting that the borrower has at least 12 months of mortgage payments in reserve.
- Extended deadline
The end date to get a HARP refinance has been extended to December 31, 2015.
Is your mortgage owned by Fannie Mae or Freddie Mac?
Use their online tools to quickly find out, or call them toll-free:
Loan Look-up Tool:
Call: 800-7FANNIE (8 am to 8 pm ET)
Loan Look-up Tool:
Call: 800-FREDDIE (8 am to 8 pm ET)
Note: Be sure and check your address on both the Fannie Mae and Freddie Mac look-up tool. If your address does not appear in the look-up tool of either site, your loan is not owned by Fannie Mae or Freddie Mac and you are not eligible for the program.
Did someone say “NO?”
If a lender says you are not eligible for HARP, ask for specific reasons why. If you have good reason to believe you are eligible, ask to speak to the HARP specialist, or consider talking with a different lender. It never hurts to get a second opinion.
If after contacting your mortgage company, HARP lender and either Fannie Mae or Freddie Mac you still have questions,
Federal Housing Finance Agency (FHFA)
400 7th Street, SW
Washington, DC 20024