Mortgages Made Simple

What is the HARP Mortgage Program?

After the housing market fell in 2006, many families found themselves underwater – meaning their home was worth less than their mortgage. Falling home prices put many families in tough situations. While interest rates were low, they could not refinance their loans because banks did not want to lend more than a house was worth, measured by the loan-to-value ratio.

Officials created the HARP mortgage plan to give families more options. The Home Affordable Refinance Program is a government plan that has been run by the Federal Housing Finance Agency since 2009 to help underwater homeowners refinance their current home loans. Rather than following traditional lending standards, underwater borrowers can qualify for HARP refinance loans even if their LTV is greater than 125 percent. 

Who qualifies for HARP?

The HARP mortgage relief only applies on certain mortgage types, for instance most Fannie Mae or Freddie Mac owned mortgages. Many families do not know who backs their loan since this is usually taken care of by the lender and does not involve the borrower. Many borrowers might qualify for a HARP refinance or HARP mortgage without knowing it.    
To capitalize on the HARP mortgage program, the loan needs to be originated before May 31, 2009. Loans already refinanced through HARP are not eligible for another refinance through the HARP mortgage option.

See if you qualify for a refinance loan through the HARP Program. 

Why HARP loans are so popular

HARP mortgage assistance can be a great way to lower a family's monthly mortgage payments, potentially saving thousands of dollars through lower interest rates.  One particular advantage of HARP mortgage program is that most homeowners can skip the property appraisal process. Instead, HARP mortgage lenders use an automated valuation model that determines the value of a property based on the average value in the area. Quite simply, HARP mortgage loans are designed to make homeowners’ mortgage payments more affordable.

However, you must take advantage quickly since this may be one of the last times borrowers can take advantage of this great opportunity. The HARP 2012 program may expire in late 2013 ending all chances to take advantage of this great opportunity.