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What is HARP?

Unlike HAMP, which provides loans for people who are behind on their mortgage, HARP (Home Affordable Refinance Plan) provides assistance for those who are current on their mortgage payments (or have limited delinquencies over the 12 months prior to refinancing) and their loan to value ratio is over 80%, or their home is worth less than the amount of the mortgage loan. In addition, the loan must be owned by Freddie Mac or Fannie Mae.

Initiated in March 2009, HARP offers borrowers who have little or no equity in their homes the ability to refinance their mortgage into more affordable loans without new or additional mortgage insurance. HARP has changed since 2009, specifically, in 2011, the LTV (Loan to Value ratio) cap was removed, property appraisal requirements were waived in certain circumstances and certain risk fees for borrowers selecting shorter amortization terms were eliminated. And in 2013, the eligibility date was changed from the date the loan was acquired by Fannie Mae or Freddie Mac to the date on the note, increasing the pool of eligible borrowers. The latest change was the extension of HARP, which now expires on December 31, 2016.

The specific requirements for this special program are summarized below:

  • You are current on your mortgage, with no 30-day+ late payments in the last six months and no more than one in the past 12 months
  • Your home is your primary residence, a 1-unit second home or a 1- to 4-unit investment property.
  • Your loan is owned by Freddie Mac or Fannie Mae.
  • Your loan was originated on or before May 31, 2009.
  • Your current loan-to-value (LTV) ratio must be greater than 80%.

You can find out more at www.harp.gov.

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