Home Affordable Refinance Program (HARP)

If you're not behind on your mortgage payments but have been unable to get traditional refinancing because the value of your home has declined, you may be eligible to refinance through the Home Affordable Refinance Program (HARP). HARP is designed to help you get a new, more affordable, more stable mortgage. HARP refinance loans require a loan application and underwriting process, and refinance fees will apply.

 

You may be eligible for HARP if you meet all of the following criteria:

•The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.

•The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.

•The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.

•The current loan-to-value (LTV) ratio must be greater than 80%.

•The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.

Fannie Mae Lookup: www.fanniemae.com/loanlookup

Freddie Mac Loan Lookup:    https://ww3.freddiemac.com/corporate

What are the benefits of the program?

In short, this newer version improves on the initial HARP program by removing the 125% LTV limitation.  In plain terms, many folks who couldn’t qualify for the first edition of HARP because their homes are horribly under water would qualify now.  Other new features of HARP 2.0 include reduced pricing hits at these higher LTV’s for shorter term loans (15yr fixed) and transferable PMI, but the key enhancement of HARP 2.0 is definitely the no-limit LTV.

 

Frequently asked Questions For HAMP 2.0

1. What are the minimum requirements to be HARP eligible?

First, your home loan must be paid on time for the prior 6 months, and at least 11 of the most recent 12 months. Second, your mortgage must have been sold to Fannie or Freddie prior to June 1, 2009. And, third, you may not have used the HARP program before – only one HARP refinance per mortgage is allowed.

2. Am I eligible for the Home Affordable Refinance Program if I’m behind on my mortgage?

No. It is critical to have your mortgage payment current.

3. Will the Home Affordable Refinance Program help me avoid foreclosure?

No. The Home Affordable Refinance Program will not delay, or stop, foreclosures. It’s meant to give homeowners who are current on their mortgages, and who have lost home equity, a chance to refinance at today’s low mortgage rates.

4. I am really far underwater on my mortgage. Can I use HARP?

Yes.  This is the main reason for the revised HARP 2.0 program.  The new HARP program specifically has no loan-to-value restriction.

5. Will my home need an appraisal with the HARP program?

Maybe,  The rules from Lender to Lender haven’t been made public for the March 1 rollout.  So most likely there will be some value determination run, but most likely won’t be a full Appraisal and even if required won’t impact the ability for you to qualify for the program.

6. Is HARP the same thing as an FHA Streamline Refinance?

No, the HARP program is administered through Fannie Mae and Freddie Mac. FHA Streamline Refinances are performed through the FHA. The programs have similarities, however.

7. Do I have to use my current lender to refinance under the HARP 2.0 program?

No, you can do a HARP refinance with any Fannie or Freddie direct lender effective March 1st. 

8. I put down 20% when I bought my home. My home is now underwater. If I refinance with HARP, will I have to pay mortgage insurance now?

No, you won’t need to pay mortgage insurance. If your current loan doesn’t have PMI, your new loan won’t require it.

9. I pay PMI now. Will my PMI payments go up with a new HARP refinance?

No, your private mortgage insurance payments will not increase. However, the “transfer” of your mortgage insurance policy may require an extra step. 

10. What’s the biggest mortgage I can get with a HARP refinance?

HARP refinances are limited to the conforming loan limits specified by County

11. Can I do a cash-out refinance with HARP? 

No, the HARP program is only a rate-and term refinance program

12. Can I refinance an investment/rental property with HARP?

Yes.

13. Can I refinance a second/ vacation home with HARP?

Yes.

14. Can I refinance a condo with a HARP refinance? 

Yes.

15. Can I consolidate mortgages with a Making Home Affordable refinance?

No, you cannot consolidate multiple mortgages with the HARP refinance program. It’s for first liens only. All subordinate/junior liens must be re-subordinated to the new first mortgage.

16. Can I roll my closing costs into a Making Home Affordable refinance?

Yes, mortgage balances can be increased to cover closing costs in addition to other monies due at closing such as escrow reserves, accrued daily interest, and a small amount of cash. No loan sizes can exceed the local/county conforming loan limits. 

17. What are the HARP program’s mortgage rates?

Mortgage rates for the HARP program are the same as for a “traditional” refinance. If you obtain a term of 30 years or more there is a slight price improvement.

18. Is there a minimum credit score to use the HARP program?

No, there is no minimum credit score requirement with the HARP refi program, per se. However, you must qualify for the mortgage based on traditional underwriting standards.

19. What does the term “DU Refi Plus” mean? 

“DU Refi Plus” is the brand name Fannie Mae assigned to this particular HARP program. “DU” stands for Desktop Underwriter. Loans need to be submitted through this DU engine

20. Is there a 125% loan-to-value restriction for HARP?

No, there is not a 125% loan-to-value restriction. All homes — regardless of value — are eligible for the HARP program. The only issue is Loan Limits. Which is determined by the County the home is located

21. When does the HARP 2.0 program end?

April 2014, but rates may not be this low for that long, so it is important to start the process as soon as possible.

22. What are the income requirements? 

For many borrowers, who are lowering their payments, the lender will not require documentation of income.  Some lenders may have overlays or ask for some verification of income.  All lenders will do a verbal verification of employment before closing.  If your payment is increasing by more than 20% a full income underwriting will be performed.

23. I have had a bankruptcy or a foreclosure in the past, can I still refinance under HARP?

YES! HARP 2.0 allows you to refinance your property if you have had some credit problems in the past.  Even if you had a Bankruptcy or Foreclosure in the past 12 months you can still refinance under this program.

24. Do I have to have reserves or assets?

The general answer is NO.  Each HARP refinance is run though a computer system.  The system will indicate if you are required to have any reserves in order to refinance.   In general HARP waives most reserve requirements.

25.  Can I add or remove a Borrower or Co Borrower from my loan?

It is possible to add or remove someone from the loan.  The process to do that can be a little delicate.  You can remove a borrower from the loan only under certain circumstances. 

26. What documents are needed to close?

Each loan is different.  Some borrowers will be eligible for income waivers and others may have to show their last 2 years tax returns.  One item you should try and look for is the NOTE you received, when you originally took out your loan.  Most lenders will need this to verify you qualify for the loan.

 

For more information on the foreclosure process, feel free to visit http://lighthouseconsultinggroup.org/.