Home Affordable Refinance Program (HARP) is a program that started in 2009 and was designed to stimulate the economy. It is a government backed refinance program to help borrowers that are upside down in their home.
HARP 2 has been around for a short time, but already there are rumors about a new program or changes to the current program. In January there were indications that every homeowner should be able to refinance and that if their loan wasn't serviced by Fannie Mae or Freddie Mac, it shouldn't matter. That idea is growing in popularity, so it may come about.
In 2012, HARP removed some of the loan to value restrictions that had been affecting many homeowners and the thought was that many would be able to refinance with those changes. The basic requirements to use HARP are:
- You must have less than 20% equity in your home
- You must have paid your loan on time for the last 6 months
- Your loan must have been securitized prior to June 1, 2009
- Your loan must be backed by Fannie Mae or Freddie Mac
The change that may be coming will help many as it would remove the requirement that your loan must be backed by Fannie Mae and Freddie Mac.
This change has not been voted on and may never actually come about, but the talk is there. If so, it would allow many people that have not been able to do anything simply because they were not backed by Fannie and Freddie. Most mortgages are currently backed by Fannie/Freddie/FHA now, but prior to 2009, about 1/3 of the mortgages done were AltA loans and those are not backed by Fannie and Freddie.
If you have a mortgage that is not backed by Fannie or Freddie, keep this in mind and if you hear of more changes, it may allow you to refinance your home!
Leslie Vanderwerf, NMLS ID#335509, Summit Mortgage - Email - Website
