The HARP Loan Program
The Federal Housing Finance Office and the two largest mortgage funding companies, Fannie Mae and Freddie Mac, have recently allowed for adjustments to be made to the Home Affordable Refinance Program (HARP) to allow lenders to provide mortgage refinances to homeowners who could not previously qualify. Lenders will be able to begin issuing these revised refinances beginning December 1, 2011.
The Home Affordable Refinance Program was issued in 2008 when home values dropped and was intended to help struggling homeowners make their mortgage payments. The newly modified Home Affordable Refinance Program will allow more homeowners to refinance as it allows anybody to refinance their mortgage, regardless of how much the owe and how much their home value has dropped.
The modified HARP program removes a stipulation from previous refinance regulations that stated that homeowners who owed an amount on a loan that was 25 percent, or more, greater than the home's value would not be eligible to refinance. The removal of this stipulation allows up to an estimated 4 million homeowners to refinance.
Homeowners who are hoping to finally be able to refinance with the new HARP program must meet a few requirements. First, their mortgage must be financed through Fannie Mae or Freddie Mac. Second, homeowners who took out their mortgage during the past two years are not eligible, and finally, homeowners must have been current on their loan for the previous six months and currently be employed.
If you have tried in vain to refinance your property, the newly modified Home Affordable Refinance Program may be the best way for you to save money and receive a lower interest rate on your mortgage. With the removal of many roadblocks in the requirements for refinances, you may now have a better chance to qualify for a home refinance and potentially save thousands on your home loan.
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