What Is Home Affordable Refinance Program (HARP)
The Home Affordable Refinance Program (HARP) was an initiative launched the federal government in 2009 in the wake of the housing market collapse. This program was launched in order to help people cope with the issue of foreclosure. This program serves to initiate loan modification, refinance and provide foreclosure alternatives to homeowners.
The Home Affordable Refinance Program also known as HARP in short helps homeowners to restructure their existing mortgage as an alternative to foreclosure. It enables them to lower the interest rate as well is monthly payments. This program is targeted to homeowners who need a financial reprieve from the high mortgage payments were unable to refinance you to their inability to accept a decrease in the value of the home.
Are You Eligible For The Home Affordable Refinance Program (HARP)
In order to be eligible for the home affordable refinance program you must have one to 4 units home, have a loan guarantee by Freddie Mac or Fannie Mae and the current on all mortgage payments. In case you need these requirements in contact your what age lender to get further details and to apply for this program.
The paperwork and documentation required usually is:
- the pay stubs of your mortgage payments,
- a copy of your income tax return,
- mortgage note and mortgage deed,
- account balances on loans and credit cards,
- second mortgage information,
- insurance information and
- your bank statements.
As it is a federal government process the approval period can be a lengthy even though the application process is simple and quick. The response time for approval can take several months.
FAQ For Home Affordable Refinance Program (HARP)
Here are some of the frequently asked questions about the Home Affordable Refinance Program.
Will Refinancing through the Home Affordable Refinance Program (HARP) lower the principle balance?
When you refinance your mortgage through The Home Affordable Refinance Program the balance of the mortgage does not decrease. You will still owe the same amount of money to the lender as before. However, it is meant to offer relief to the borrower by lowering the interest rate for increasing the term of the mortgage or both. This means that your monthly payments might refuse but over the entire tenure of the loan you are still be paying back the same principle balance as before and perhaps even more on the cumulative interest.
How Do I Find out If My Mortgage Is Owned or Guaranteed by Fannie Mae Freddie Mac?
The easiest way to find out if your mortgage is owned by Freddie Mac or Fannie Mae you should simply ask your lender. They will be able to inform you if your loan has been guaranteed or backed up by either of these financial institutions. You may also contact Freddie Mac or Fannie Mae directly using a toll-free hotline number. Providing them with your loan identification number will enable them to access your account in their database and tell you whether they are handling your loan or not.
Can I qualify for the Home Affordable Refinance Program (HARP) if the current value of my house is less than what I owe on the mortgage?
The rules of the Home Affordable Refinance Program state that the amount you refinance has to be not more than 125% of your current value. Usually the process of appraising the value of the home happens once you apply for this program.
Can I Get Cash out with Home Affordable Refinance Program (HARP)?
The Home Affordable Refinance Program is meant to offer relief to people who can no longer afford to make payments on their mortgage and are facing the risk of foreclosure on their homes. It is the federal incentive to offer assistance to such borrowers. Cash out is a feature that allows you to borrow extra money by refinancing through the increased equity in the home for other expenses. Cash out is not possible with the Home Affordable Refinance Program.
Can I benefit from the Home Affordable Refinance Program (HARP)?
In order to get an estimate of what the benefit will be in your particular case of refinancing through this program you can ask your lender for a good fit estimate. You can also do a calculation yourself using one of the many online free mortgage calculators. You should appreciate the fact that while refinancing through this program will lower your monthly payments it might increase the cumulative interest at you’re a on your entire mortgage if the term of the mortgage happens to increase.