In today’s economy, making your mortgage payment can be a challenge. The HARP Loan Program was developed to help those responsible homeowner’s who have made payments on-time, but have been unable to refinance due to various conditions. The most common barrier to refinancing, underwater home values, can now be over come with HARP.
HARP or the Home Affordable Refinance Program is a government program that is designed to help homeowners refinance their existing mortgages into more affordable loans. With the HARP program, homeowners can refinance their mortgages even if they owe more than what their homes are worth.
With a regular mortgage, the lender only allows you to borrow up to a loan-to-value ratio that is based on the value of the house. For example, many lenders use a loan-to-value ratio of 80 percent. This means that you can only borrow up to 80 percent of the value of the home. With the HARP program, there is no loan-to-value ratio to worry about. This means that even if you owe much more than what your home is worth and you wouldn’t be able to get another type of mortgage, the HARP program may allow you to refinance.
Not everyone can get a HARP refinance. In order to participate in this program, your loan must be owned by Fannie Mae or Freddie Mac. If your loan is owned by one of these two entities, you also have to be current on your mortgage. You can only have one late payment on your record in the last year as well. In order to participate in this program, you also cannot get any cash out of the loan. The purpose of the refinance has to be to lower your payment and to take advantage of a lower interest rate. (Click Here to read more about HARP qualification criteria)
HARP is meant to be a help to homeowners who are in distressed situations and cannot afford their current mortgage payments. To participate in this program, you can use any lender who is involved in HARP. You don’t have to refinance with your existing mortgage holder in order to participate in the program.
Using the HARP program can sometimes help you avoid going into foreclosure and keep the home that you currently live in. Instead of simply giving up your home to the lender and ruining your credit through a foreclosure, consider applying for the HARP refinance program and get the help you need.