President Obama’s HARP (Home Affordable Refinance Program) just hit the wire’s and is making quite a splash.
The goal of the program is to help homeowners who are currently underwater, refinance their mortgages to today’s rates regardless of loan to value ratios. This will save thousands of dollars for millions of home owners.
You probably know that the first attempt at HARP was a pretty big failure. It was meant to serve 5M homeowners, but has so far only served about 800k. To their credit, Uncle Sam has now revised the program guidelines to meet the needs of a greater number of homeowners.
To determine if you are eligible for the HARP program, ask yourself the following questions:
ü Did you CLOSE on your home on or before April of 2009? (the loan must have been sold to Fannie/Freddie by May, 2009 which usually takes 30 days).
ü Are you CURRENT on all of your payments over the last 6 mos and have you not missed more than 1 payment over the last 12 months?
ü Is the amount of your first mortgage GREATER than 80% of the value of your home?
o Ex: Home Value = 175,000.00 & Loan Amount = 160,000.00
ü Is your Loan currently owned by FANNIE MAE or FREDDIE MAC?
o If you’re not sure which agency owns your loan, search here:
§ Fannie Mae: http://www.fanniemae.com/loanlookup/
§ Freddie Mac: https://ww3.freddiemac.com/corporate/
If you’re able to answer YES to all of the above, you’re eligible for the HARP program!
· Q: What if I’ve rented out my home and moved to a new one?
A: No problem! HARP will still allow you to refinance to a lower rate. Note that because your property is now an investment, it will have a higher rate than a primary residence, but will likely still enjoy substantial improvement.
· Q: What is the maximum Loan to Value ratio?
A: FHFA has provided no guidance on LTV, we expect there will be NO LTV requirements!
· Q: Do I need to get an appraisal?
A: Nope! No appraisal is ordered. This will help in keeping closing costs low as well.
To learn more about whether you or someone you know is eligible for the HARP program, contact Adam below: