October 2011 : The Complete, Revamped HARP / Making Home Affordable Eligibility Requirements
UPDATE (October 24, 2011) : The government announced changes to its HARP program October 24, 2011. This post is accurate and up-to-date. Click here to get a HARP refinance rate quote.
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 is the details of the government’s new 2011 HARP refinance program.
What Is HARP?
HARP was 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, 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
If you meet these two 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 program?
Yes, everything you are reading is accurate as of today, October 24, 2011. This post includes the latest changes rolled out by the Federal Home Finance Agency on October 24, 2011.
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. Check Fannie Mae’s first because Fannie Mae’s market share is larger. If no match is found, then check Freddie Mac. 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, does that mean I’m 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.
Is “HARP” the same thing as the government’s “Making Home Affordable” program?
Yes, the names HARP and Making Home Affordable are interchangeable.
My mortgage is held by Fannie/Freddie. Now what do I do?
Find a recent mortgage statement and write “Fannie Mae” or “Freddie Mac” on it — whichever group backs your home loan — so you don’t forget. Give that information to your lender when you apply for your HARP refinance.
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 HARP-ineligible. However, you may still be eligible for a “regular” refinance to lower rates. Use this form to get a rate quote to see your options.
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.
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.
What are the minimum requirements to be HARP-eligible?
First, your home loan must be current, and not delinquent. Second, your mortgage must have been sold to Fannie or Freddie prior to June 1, 2009. And, third, you may not have used the HARP program before — only one HARP refinance per mortgage is allowed.
Is there a 125% loan-to-value restriction for HARP?
No, there is no 125% loan-to-value restriction. All homes — regardless of equity — are eligible for the HARP program.
I am really far underwater on my mortgage. Can I use HARP?
Yes, you can. There is no loan-to-value restriction under the HARP program.
Maybe I wasn’t clear. I am really, really far underwater on my mortgage. Are you sure I can use HARP?
Yes, I am sure. The new HARP program specifically has no loan-to-value restriction so homeowners in Florida, California, Arizona and Nevada can take advantage of it. You can 300% loan-to-value, and still be HARP-eligible.
Will my home need an appraisal with the HARP program?
Likely yes. Although your home’s value doesn’t matter for the HARP program, lenders will want to verify that your home is visibly structurally sound and “standing”.
Is HARP the same thing as an FHA Streamline Refinance?
No, the HARP program is administered through Fannie Mae and Freddie Mac. FHA Streamline Refinances are performed through the FHA. The programs have similarities, however.
Can I refinance using HARP with any lender I want?
Yes. With the Home Affordable Refinance Program, you can refinance with any participating HARP lender. Click here for a HARP rate quote.
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, the conforming loan limit is $ 417,000. However, there are some cities in which conforming loan limits are as high at $ 625,500. You can lookup your area’s conforming loan limits by clicking here.
Can I do a cash-out refinances with HARP?
No, the HARP program doesn’t allow cash out refinance. Only rate-and-term refinances are allowable.
Can I refinance an investment/rental property with HARP?
Yes, you can refinance an investment/rental property with HARP, but only if the home was originally financed as an investment property. You can’t HARP-refi a home that was originally a primary residence and is now considered a rental.
Can I refinance a second/vacation home with HARP?
Yes, you can refinance an second/vacation property with HARP, but only if the home was originally financed as an second/vacation property. You can’t HARP-refi a home that was originally a primary residence and is now considered a second home.
Can I consolidate mortgages with a Making Home Affordable 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 into a Making Home Affordable 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?
No. Income verification is required for the HARP refinance program.
My original mortgage was a stated income loan. Will my income be verified with a HARP refinance?
Yes, with HARP, applicant income is verified in the same manner as with a traditional refinance — via a combination of W-2s, paystubs, tax returns and other, underwriter-requested documentation.
What are the HARP program’s mortgage rates?
Mortgage rates for the HARP program are the same as for a “traditional” refinance. Loan-level pricing adjustments may apply.
Is there a minimum credit score to use the HARP program?
No, there is no minimum credit score requirement with the HARP refi program, per se. However, you must qualify for the mortgage based on traditional underwriting standards.
Do I have to refinance my mortgage with my current lender?
In most cases, no. You can do a HARP refinance with any lender you want. Click here for a HARP rate quote.
What does the term “DU Refi Plus” mean?
“DU Refi Plus” is the brand name Fannie Mae assigned to its particular flavor of the HARP program. “DU” stands for Desktop Underwriter. It’s a software program that simulates mortgage underwriting. “Refi Plus” is a gimmicky-sounding term that could have been anything. The name has been trademarked, however. As an aside, Freddie Mac is using the branded name “Relief Refinance”.
Can I remove my spouse or a co-signer with a HARP refinance?
Maybe. HARP guidelines specifically prohibit removing a co-signer from the note, but there are circumstances in which you can remove a co-signer from the mortgage and from the deed so that the former co-signer has no ownership interest in the home.
For how long should I lock my mortgage rate via the HARP Program
Lock for 30 days, at minimum. This is because the HARP program, while streamlined for simplicity, still has some grey areas that can lead to delay. It’s better to have a rate lock that lasts too long than not long enough.
When does the HARP program end?
If you are HARP-eligible, you must close on your mortgage prior to January 1, 2014 — 799 days from now.
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.
Apply For Home Affordable Refinance Program
When you’re ready to see mortgage rates, click here for a free HARP rate quote.
Lastly, don’t forget! The Home Affordable Refinance Program is not meant to save a home from foreclosure. It’s meant to give underwater homeowners a chance to refinance without paying PMI. If you need foreclosure help, call your current loan servicer immediately.
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