As we have written about recently, the HARP refinance program is set to expire at the end of this year (December 31, 2015).
The program is a government backed initiative to allow borrowers who could previously not refinance, due to lack of equity or being upside down in their homes, to now do so. In addition, the program also can help homeowners who have had a recent major credit issue to refinance as well, as a foreclosure or short sale on another property will not prevent you from refinancing through HARP.
If you took out your current loan prior to June 1, 2009 and Fannie Mae and Freddie Mac owns your home loan, there is no restriction on value, in order to refinance. In other words, the current appraised value of your home will not disqualify you from refinancing, regardless of value.
In recent weeks we have covered some basic information about the program, but now we will answer some common questions that have been raised to us, about the program.
Question #1: Does this HARP 2.0 program apply to only homeowners who currently live in homes as their primary residence?
Answer: No, the HARP 2.0 program is open to homeowners, regardless of whether the home is currently a primary residence, second home or investment property. The current occupancy of the home will not disqualify you from qualifying for the HARP 2.0 program.
Question #2: Do, I need to be on time on my current mortgage, in order to qualify for a refinance, using the HARP 2.0 program?
Answer: Yes, well at least technically. The standard guidelines for the refinance of your home through the program require that you have made your last 12 months mortgage payments on time. You can have had late payments on other payment accounts and still qualify however.
Question #3: If I had a recent short sale or foreclosure on another property or even a bankruptcy, can I still refinance my home through the HARP program?
Answer: Yes, you can refinance under the HARP refinance program, even if you had a recent short sale or foreclosure on another property or if you had a bankruptcy, if your loan is Fannie Mae owned (Freddie Mac has not made this the case yet). The HARP program waives all of the normal Fannie Mae waiting period on these items.
Question #4: Do, I have to pay mortgage insurance with the new program, since my home has less than 20% equity.
Answer: No, you do not have to pay mortgage insurance with your new HARP 2.0 loan, even though you have less than 20% equity in your home. Normally, if you have less than 20% equity in your home and you take out a conventional refinance or purchase home loan, than you have to pay mortgage insurance, but that is waived through the HARP program. In this case, it also makes sense for borrowers who may not be upside down but owe a little more than 80% of the value of their home on their current loans to use the HARP program. In that, they too can also avoid mortgage insurance, even if they only have a little equity in their homes.
As always it makes sense to speak to a lender about current home loan options and it is always advisable to speak with a licensed mortgage lender, such as Strategic Mortgage. In future weeks, we will continue to provide additional updates on the HARP 2.0 program.
For more information on current home loan programs and options 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
Strategic Mortgage, LLC – AZBK#0909514 - NMLS#158804 - Equal Housing Lender
Vasilios Kamboukos – NMLS#160440
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