Mortgage Lending

What is a HARP?

Posted on May 26, 2009. Filed under: Refinance | Tags: HARP, Mortgage, Refinance |

Home Affordable Refinance Program (HARP).  By now many have heard this acronym and some can grasp the concept and understand what it means.  The government created programs allowing those people that lost equity in their home that could not refinance using traditional loan guidelines, to do so.   If your home loan makes up no more than 105% of the appraised value of your home you can refinance using HARP.  It is complex in some aspects but below I will simplify some of the requirements and restrictions.

1. Your loan must be pooled with Fannie Mae or Freddia Mac.  Your current servicer (those that send your mortgage statement) can tell you if it does or you can check here.  http://makinghomeaffordable.gov/loan_lookup.html.
2. If your current loan has mortgage insurance you cannot currently use this program.  Why?  Because Mortgage Insurance companies are private entities and the complex details of insuring loans with little to equity have not yet been worked through.  Expect this to change soon.
3. If your loan is above 417k you cannot yet use this program.
4. Which GSE (Fannie or Freddie) your loan is with determines the details of the refinance, as Fannie and Freddie put forward very different executions of their own versions.

As I write this two very important changes are on the very near horizon.

1. Loans with mortgage insurance WILL be able to use this program, likely within weeks.  Details relating to this are currently being implemented within major lenders.
2. Loans above 417k will be able to use HARP.  Again, details are currently being implemented within major lenders.

For questions about these HARP programs don’t hesitate to reach out to me.  More details to follow.

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