In recent weeks, we have focused on the HARP refinance program as a refinance tool for homeowners who are upside down on their homes. And it is in fact a great program for borrowers who are upside down to refinance and take advantage of today’s historically low interest rates. However, for homeowners who are not upside down on their homes, the HARP program also can offer benefits as well.
Benefit #1- Appraisal Waivers: Traditionally, when refinancing a conventional loan, you needed to have an appraisal done on your home. In today’s market, this is an added expense and hassle in the refinance process and often times the numbers on appraisals are very conservative. Even if you have equity in your home, a HARP refinance can allow you to refinance and potentially receive an appraisal waiver, lowering the total cost to refinance and providing a quicker and easier process.
Benefit #2 – No Mortgage Insurance: On a conventional home loan refinance, if you owe more than 80% of the value of your home on a first mortgage, then you have to obtain mortgage insurance on your home loan. For many homeowners who at one point, put 20% down to purchase a home and have now seen home values drop, they can no longer refinance without having to contend with mortgage insurance. With the HARP refinance program, that is no longer the case. If you over 80% of the value of your home, you do not need to obtain mortgage insurance and so you can lower your interest rate without having to add costly mortgage insurance to your loan.
These are two major benefits to think about refinancing through the HARP program, even if you are not upside down.
As always it makes sense to speak to a licensed mortgage lender, such as Strategic Mortgage, about current home loan options. In future weeks, we will continue to provide additional updates on the HARP 2.0 program as they become available.
For more information on home purchase loan or refinance programs for existing and potential home owners, please contact Bill Kamboukos of Strategic Mortgage at (480) 219-3682 or by emailing: info@strategicmtgaz.com or online at www.strategicmtgaz.com
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