Because over a million homeowners may be eligible for this refinance and it comes out this month in March.
The HARP program is designed to help people who have made good on their mortgage obligation through a period of severe economic stress and housing price declines. This program will refinance your 1st mortgage only. The HARP program will allow borrowers to refinance their current mortgage to today’s lower rates. This program is specifically for borrowers who are “underwater” on their mortgage.
Borrowers who fulfill the following criteria will, in general, qualify for the HARP 2 program
- They must be current on their mortgage and have no record of a late payment within the last six months, and may only have had one late payment maximum over the past 12-month period.
- The current loan-to-value ratio (LTV) must be higher than 80%.the mortgage must have been sold to or guaranteed by Fannie Mae or Freddie Mac on or before May 31, 2009
- The mortgage must not have already been refinanced through HARP in the past, unless it happens to be a Fannie Mae loan that underwent a HARP refinance between March and May 2009
Your mortgage must be owned by Fannie Mae and Freddie Mac and to check it is as easy as going to these web sites and entering your information:
If Fannie Mae or Freddie Mac own your loan than you can apply for the HARP 2 on an owner occupied home, a second home or a rental property. It can be a single family home, a villa or a condo it does not matter. You can owe 250K on a home that is now worth 200K it does not matter. You can have multiple properties owned by Fannie Mae or Freddie Mac and they are all eligible.
If you check and your home is owned by either Fannie Mae or Freddie Mac then call your current servicer (your servicer is who you are making your payments to) and ask them if your loan qualifies for a HARP 2 loan. Then ask them what rate and terms are they offering. I have clients who have called their servicers and have been offered lower rates, shorter terms, no appraisal and minimal closing costs.
If you have a second mortgage and that lender will subordinate then you can refinance the first mortgage. You can NOT include the second mortgage in the new loan. If you currently have MI insurance and Fannie Mae or Freddie Mac own the loan then you are eligible to refinance. You can not get back more than $250.00 at closing.
Consider a shorter term on your mortgage to pay off your loan faster and build equity. Rates on a 15 year mortgage are less than a 30 year term. If you have been paying on your mortgage for the past 3 years ask your servicer for a 27 year term instead of a 30 year term.
Whatever you do first check the two web sites above and then pick up the phone and call your current servicer and ask if they participate in the HARP 2 program and if they do get started. If your servicer does not offer the HARP 2 program then call me.