For those of you who don’t know, HARP 2.0 is an extension of the original Home Affordable Refinance Program (HARP). This is a program that the Government put into place to help homeowners that are underwater take advantage of these record low rates. The 2.0 update extends the program until December 31, 2013, and allows refinances no matter how much you owe (limitations apply) or how far your home’s value has dropped – and often without an appraisal.
Just yesterday I helped a borrower drop her rate from 5.75% to 3.75% with no closing costs and no appraisal. This change saved her more than $450 / month (over $5,000 per year!). Not bad for no costs and about 1 hour total out of her life. Wish I could get that type of hourly wage.
There are a number of guidelines for using this program but the main requirements are:
- Your loan must be owned by Fannie Mae or Freddie Mac. This is different than who services your loan. Since Fannie and Freddie own about 75% of the loans there is a good chance they do own your underlying mortgage.
- Fannie Mae or Freddie Mac must have bought it on or before May 31, 2009.
- You can’t have refinanced previously under HARP unless it was during March-May 2009.
- You must be current on your mortgage, have no late payments in the last 6 months and have one late payment or less in the last 12 months.
Other HARP 2.0 Facts
- You may not need an appraisal to refinance. We’re seeing more than 50% of our HARP 2.0 clients receive an appraisal waiver.
- This can be used for primary, secondary and investment properties.
- No mortgage insurance is required if your current loan does not have mortgage insurance.
- You can only refinance your first mortgage under HARP 2.0 but most 2nd lenders are willing to subordinate the 2nd mortgage.
Please let me know if you want to find out more about this great program.