Debt-Free Blueprint by Laura D. Adams

Author:Laura D. Adams [Adams, Laura D.]
Language: eng
Format: epub
Publisher: Laura D. Adams

RESOURCE: Use the free Mortgage Refinance Calculator at LauraDAdams.com/debt-toolkit to find out if you should consider refinancing your mortgage.

19

Using HARP to Refinance

The Home Affordable Refinance Program, or HARP, is unique. It’s the only refinance program that allows homeowners who are current on their payments, but have little to no equity in their homes, to refinance.

HARP was created in 2009 in response to the recession and its housing crisis. As home values declined rapidly, many borrowers were “underwater,” owing more than their property was worth. It became unaffordable to sell your home and impossible to refinance it.

The HARP offering has evolved, but it is currently set to expire at the end of 2018. However, Fannie Mae and Freddie Mac, which are government agencies, will offer permanent refinance programs for eligible borrowers with high loan-to-value loans. This will fill the gap HARP leaves behind at the end of 2018. Visit HARP.gov for up-to-date information.

The bottom line is that if your mortgage is owned by Fannie Mae or Freddie Mac, you may qualify for HARP or another refinancing program. That could save thousands with a lower rate or other more favorable terms. No minimum credit score is required and closing costs can be bundled into the new loan so you don’t need much cash up front.

HARP may be an option if:

You have had a good payment history for the past 12 months

Your home is your primary residence, second home, or investment property

Your home value has decreased

You have limited equity or your first mortgage exceeds the current market value of the home

Your loan-to-value ratio is greater than 80 percent

Your loan is owned or guaranteed by Fannie Mae or Freddie Mac (check the Fannie Mae Loan Lookup tool at KnowYourOptions.com/loanlookup)

Your loan was closed on or before May 31, 2009 (this date can be found using the loan lookup results)

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