The HARP program has been underway and is still going on until now. The government has been getting lots of application for the HARP loan program since the 1st of May 2009. The HARP program or the Homeowner Affordability Refinance Program is offered to homeowners who do not qualify for the refinancing of their current home loans. The HARP loan program has been on the news since the day it was released and a lot of people have taken advantage of this fantastic opportunity of getting help with loans which are either classified as Fannie May or Freddie Mac.
If you are a homeowner who has a home loan which is either owned by Freddie Mac or Fannie May, there is a very big chance that you qualify. There are several lenders today which are offering this type of loan. To find out if your loan is owned by either of the two names mentioned earlier, all you need to do is go to loanlookup.fannimae.com/lookup/ or go to ww3.freddiemac.com/corporate/. You will get an immediate response from these sites.
The HARP loan program will refinance only the 1st loan. Even if you have a 2nd mortgage, it will remain as it is. The HARP loan can refinance up to 105% of the current value of your home. It is a loan which is meant for people who are under water or who owe more than the home is worth; have an ARM or adjustable rate mortgage which will reset shortly or has already reset; have an interest rate which is higher than the prevailing interest rates; people are not eligible to refinance because of a decrease in monthly income and lastly, people who want to refinance but cannot because their house loan value to ratio is above 80%.
However, for people who have a current mortgage insurance or a lender paid mortgage insurance, this loan is not suitable for them. This is because approval will require mortgage insurance and there are no private mortgage insurers who are willing to take a risk. There are people who have are not even aware that they have a lender paid mortgage insurance. So, how can you be certain if you have this type of loan? If your loan is owned by Fannie Mar or Freddie Mac and the original loan amount is greater than 80% of the home’s appraised value and the monthly payments do not show a private mortgage insurance component, it is almost a guarantee that your loan is a lender paid mortgage insurance.
The HARP loan program can have a lot of good things to offer including lower closing costs, no requirement for appraisal, more lenient underwriting, loan rates which conventional loans offer, adjustments for credit scores and other things and of course, no mortgage insurance. Closing costs can also be included in the mortgage itself. This loan does not require any cash upfront, all you will have to pay is the credit report fee and appraisal fee. The goal of the loan is to help reduce current payments.