No- not the large musical instrument. Today I’m talking about the Home Affordable Refinance Program.
HARP is a program which may allow you to refinance your mortgage and save lots of money in interest charges. HARP is designed for home owners who have little or no equity in their homes the ability to refinance and get a lower interest rate. Even home owners who are upside down can refinance. As a definition, someone who is upside down owes more than the property is worth.
The housing crisis we endured about 8-9 years ago left many home owners upside down. Foreclosures were causing people to lose their homes. As an aside, this has been a major contributor to the shortage of rental unit we are still experiencing. In 2008 alone, more than 860,00 homes were foreclosed upon.
Then in 2009, in order to help these people and bring some stability back to the market, Freddie Mac and Fannie Mae introduced the HARP program. And almost 3.5 million home owners have used the program to refinance their homes since. And with the extremely low interest rates being offered today, it may save these home owners a bundle in reduced interest charges.
If you have been paying on your 30 year mortgage for a number of years, and don’t want to start the 30 year cycle over again, plans are available with 10 to 30 year payment schedules – you choose what you want.
The basic requirements to refinance through HARP are:
You must be current on your mortgage payments. You must not have been thirty days late with a payment in the past 6 months, and no more than one time in the past twelve months.
The property must be your primary residence, a single unit second home or a one to four unit investment property.
Freddie Mac or Fannie Mae must be the owners of the mortgage.
A loan-to-value ratio must be at least 80%.
The loan must have originated before May 31, 2009
HARP was scheduled to expire in September 2017, but it was recently extended until December 2018.
You will need to pay closing costs, the same as with any refinance. These costs can be rolled into the new mortgage. Do the math to see if this would work for you. If you need help, contact a mortgage professional.
Then contact your lender and inquire if they participate in HARP, or contact any approved HARP lender.
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