The Home Affordable Refinance Program (HARP) has been extended through December 31, 2013 and allows homeowners to refinance into low mortgage interest rates even if the property has decreased in value.
Established in 2009, for Fannie Mae and Freddie Mac, the Home Affordable Refinance Program provides an option for homeowners to refinance “Under Water Mortgages”. A HARP Refinance addresses situations where the homeowner’s property value has fallen causing them to no longer to qualify under traditional underwriting criteria. Homeowners with a loan owned by Freddie Mac or Fannie Mae have the opportunity to refinance with any participating lender as long as the resulting loan is less than 125% of the current property’s value.
The following criteria must be met to qualify for the Home Affordable Refinance Program:
- You must live in the home being refinanced.
- A HARP refinance only applies to Fannie Mae or Freddie Mac mortgages.
- The homeowner must be able to afford the new lower payment.
- The current mortgage must be up to date with no late payments in the past twelve months.
- Payments on the new loan must be more affordable or more stable than on the existing loan.
- The maximum Loan to Value (LTV) cap has been removed on home owners looking to refinance in to a fixed rate mortgage.
- However for homeowners looking to refinance in to an adjustable rate mortgage the maximum LTV is set at 105%.
The popularity of the HARP mortgage program has steadily grown since 2009. The three months ending in February 2011 saw record volume of 145,000 new HARP loans.
A participating lender can determine if your loan is owned by Fannie Mae or Freddie Mac and can further evaluate your eligibility. To contact one, fill out the convenient 4 step form to the right.
Go to the following link to determine whether or not your loan is owned by Fannie Mae or Freddie Mac: