In my previous blog titled, “President Obama’s Making Home Affordable Program,” I mentioned I would cover the federal home ownership programs available to struggling homeowners on an individual basis. In this blog, we’ll discuss the “Home Affordable Refinance Program,” known as “HARP.”
HARP is a federal modification program available to eligible homeowners experiencing financial hardship. You may be a good candidate for this program if you previously attempted to refinance your home but declared ineligible. Because of the recent recession and falling home values, many homeowners previously eligible for traditional refinancing are no longer eligible unless they have a significant amount of equity or upfront cash to subsidize their refinance.
Eligibility for HARP depends on your financial history, your debt-to-income ratio and your loan-to-value ratio. According to the Departments of the Treasury and Housing and Urban Development, homeowners must have existing loans guaranteed by Fannie Mae or Freddie Mac, a loan-to-value ratio of more than 80 percent, and a good financial history of paying their loans on time within the last year before applying. Furthermore, eligibility is limited to those who have never previously refinanced under this program unless refinanced in 2009 under the existing HARP program.
The HARP program will sunset on Dec. 31, 2013. This means that you have less than two years to apply for the program. If you do not qualify for the HARP program, you may contact our office or your loan servicer about submitting an application for another Making Home Affordable program. You may even qualify for a principal mortgage reduction or loan forbearance.
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