The government's new HARP 2.0 Refinance Program is available to U.S. homeowners as of March 17, 2012 and is extended until December 31, 2013.
If you're underwater on your conforming, conventional mortgage, you may be eligible to refinance without paying down principal and without having to pay mortgage insurance.
Here are the details of the government's new 2012 HARP refinance program.
What Is HARP?
HARP was originally started in April 2009. It goes by several names. The government calls it HARP, as in Home Affordable Refinance Program.
The program is also known as the Making Home Affordable plan, the Obama Refi plan, DU Refi +, and Relief Refinance.
In order to be eligible for the HARP refinance program :
- Your loan must be backed by Fannie Mae or Freddie Mac.
- Your current mortgage must have a securitization date prior to June 1, 2009.
- You have not been delinquent on your mortgage within the pas 6 months.
If you meet these three criteria, you may be HARP-eligible. If your mortgage is FHA, USDA or a jumbo mortgage, you are not HARP-eligible.
HARP : Questions and Answers
Do these question-and-answers account for the "new" HARP mortgage program?
Yes, everything you are reading is accurate as of April 11, 2012. This post includes the latest changes as rolled out by the Federal Home Finance Agency on October 24, 2011, and as confirmed by Fannie Mae and Freddie Mac on November 15, 2011. HARP 2.0 was formally released by Fannie Mae and Freddie Mac March 17, 2012.
How do I know if Fannie Mae or Freddie Mac has my mortgage?
Fannie Mae and Freddie Mac have "lookup" forms on their respective websites.
Your loan must appear on one of these two sites to be eligible for HARP.
If my mortgage is held by Fannie Mae or Freddie Mac, am I instantly-eligible for the Home Affordable Refinance Program?
No. There is a series of criteria. Having your mortgage held by Fannie or Freddie is just a pre-qualifier.
My mortgage is backed by my bank. Am I eligible for HARP?
There is a chance that your bank backs your loan, but what's more likely is that your bank is just your mortgage servicer; the company that collects your payments each month. Most banks back very few of its own loans. For most loans for which payments are sent to the bank, you'll find that Fannie Mae or Freddie Mac are the actual loan-backers. Double-check with Fannie Mae's and Freddie Mac's websites to make sure your loan is not held by your bank.
What if neither Fannie Mae nor Freddie Mac has a record of my mortgage?
If neither Fannie nor Freddie has record of your mortgage, your loan is not HARP-eligible. Or, if your mortgage is insured by the FHA, use you can use the FHA Streamline Refinance, which helps underwater homeowners, too.
Am I eligible for the Home Affordable Refinance Program if I'm behind on my mortgage?
No. You must be current on your mortgage to refinance via HARP.
What are the HARP program's mortgage rates?
Mortgage rates for the HARP mortgage program are the same as for a "traditional" refinance. There is no "premium" for using the HARP program.
Will the Home Affordable Refinance Program help me avoid foreclosure?
No. The Home Affordable Refinance Program is not designed to delay, or stop, foreclosures. It's meant to give homeowners who are current on their mortgages, and who have lost home equity, a chance to refinance at today's low mortgage rates.
If I refinanced with the original HARP a few years ago, can I use it again for HARP II?
No. You can only use the HARP mortgage program one time per home. If you used HARP 1, you cannot use HARP 2.0.
I am really far underwater on my mortgage. Can I use HARP?
Yes, you can use HARP even if you're really far underwater on your mortgage. There is no loan-to-value restriction under the HARP mortgage program so long as your new mortgage is a fixed rate loan with a term of 30 years or fewer.
If I refinance with HARP using an ARM, do I still get "unlimited LTV"?
No, if you use an ARM for HARP 2.0, you are limited to 105% loan-to-value. Only fixed rate loans get the unlimited LTV treatment.
Will my home require an appraisal with the HARP mortgage program?
Sort of. Although your home's value doesn't matter for the HARP mortgage program, lenders will run what's called an "automated valuation model" (AVM) on your home. If the value meets reliability standards, no physical appraisal will be required. However, your lender may choose to commission a physical appraisal anyway -- just to make sure your home is "standing".
Do I have to HARP refinance with my current mortgage lender?
No, you can do a HARP refinance with any participating mortgage lender.
I put down 20% when I bought my home. My home is now underwater. If I refinance with HARP, will I have to pay mortgage insurance now?
No, you won't need to pay mortgage insurance. If your current loan doesn't require PMI, your new loan won't require it, either.
I pay PMI now. Will my PMI payments go up with a new HARP refinance?
No, your private mortgage insurance payments will not increase. However, the "transfer" of your mortgage insurance policy may require an extra step. Remind your lender that you're paying PMI to help the refinance process move more smoothly.
What's the biggest mortgage I can get with a HARP refinance?
HARP refinances are limited to your area's conforming loan limits. In most cities in the SF Bay Area, the conforming loan limit is as high at $625,500.
Can I do a cash-out refinances with HARP?
No, the HARP mortgage program doesn't allow cash out refinance. Only rate-and-term refinances are allowable.
Can I refinance a second/vacation home with HARP?
Yes, you can refinance an second/vacation property with HARP, even if the home was once your primary residence. The loan must meet typical program eligibility standards.
Can I refinance an investment/rental property with HARP?
Yes, you can refinance an investment/rental property with HARP, even if the home was once your primary residence. The loan must meet typical program eligibility standards.
Are condominiums eligible for HARP refinancing?
Yes, condominiums can be financed on the HARP refinance program. Warrantability standards still apply.
Can I consolidate mortgages with a HARP refinance?
No, you cannot consolidate multiple mortgages with the HARP refinance program. It's for first liens only. All subordinate/junior liens must be resubordinated to the new first mortgage.
Can I "roll up" my closing costs with a HARP refinance?
Yes, mortgage balances can be increased to cover closing costs in addition to other monies due at closing such as escrow reserves, accrued daily interest, and a small amount of cash. In no cases may loan sizes exceed the local conforming loan limits, however.
I am unemployed and without income. Am I HARP-eligible?
Yes, you do not need to be employed to use the HARP mortgage program. HARP applicants do not need to be "requalified" unless their new principal + interest payment increases by more than 20%. If the new payment increases by less than 20%, or falls, there is no requalification necessary.
When does the HARP program end?
If you are HARP-eligible, you must close on your mortgage prior by December 31, 2013.
How do I apply for the HARP program?
Use this form to get a rate quote. If the rate looks good, you can accept it. There is no fee for applying.