HARP
If the current market interest rates are lower now than when you loan originated, it might make sense to refinance. Refinancing your loan can be one of the best ways to save money, lower your monthly mortgage payment, and reduce the length of the loan. Typically, refinancing is only an option for homeowners who have built up equity in their loan. The Home Affordable Refinance Program (HARP) is designed for homeowners who want to refinance their loan but owe as much or more than their house is currently worth. If you want to refinance with a lower mortgage rate, but your home has depreciated, or if you do not have much equity in your home, the HARP program could be a great option.
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Who is Eligible for HARP?
You could be eligible for this program if you meet the following criteria:
- Your loan is owned by Fannie Mae or Freddie Mac.
- You haven’t used HARP to refinance any other loan.
- The property you are planning to refinance is your primary residence, a one unit second home, or a one to four-unit investment property.
- You are current and up to date on mortgage payments, you have no payments that are more than 30 days late in the last six months and no more than one late payment in the last year.
- Your loan originated on or before May 31st, 2009.
What is Appealing About this Program?
The HARP loan program was created by the Obama administration in 2009 with the goal of helping people secure better interest rates if their property had depreciated. Homeowners who find themselves underwater on a property that has depreciated are encouraged to review the advantages of refinancing with the HARP program.
- There are no closing costs for refinancing a loan, this is a huge benefit. Typically, when refinancing a traditional loan, closing costs will be between one and 3 percent of the new loan amount.
- There is no mortgage insurance required (unless the previous loan you are refinancing has mortgage insurance).
- There are no minimum credit scores required to secure financing.
- It’s possible to secure a lower interest rate, and a shorter-term loan with a fixed (instead of adjustable) rate.
It’s important to note that this type of loan is set to expire and might not be available in 2018. If you think you are eligible, and want to discuss refinancing with a HARP, Signature Lending Services can help you through this process. Call 877-948-2562 to learn more about the HARP program.
