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Home Affordable Refinance Program - HARP 2.0

In November 2011, the federal government announced changes to the HARP program started in April 2009 to assist homeowners with taking advantage of the historically low mortgage rates. The revised program is now in effect and will be available through December 31, 2013.

Many homeowners have already begun to receive mail stating their loan is eligible for the government’s revised program – many of these solicitations displaying H.A.R.P. are not true HARP offerings and can mean higher fees. Community First Credit Union of FL is a registered HARP lender and will provide experienced, knowledgeable staff to answer your questions. While the HARP applies to both Fannie Mae or Freddie Mac held mortgages, Community First is only a Fannie Mae registered lender.

For your convenience, we’ve created a helpful list of questions & answers to help you determine if your mortgage is eligible for the HARP program.

What is HARP?
HARP was started in April 2009.  It goes by several names.  The government calls it HARP (Home Affordable Refinance Program).  It is also known as Making Home Affordable plan, the Obama Refi plan, DU Refi+ and Relief Refinance.

How do I know if I’m eligible for HARP 2.0?
If you answer “yes” to all of the following questions, you may be eligible!

  • Is your mortgage loan currently owned by either Fannie Mae or Freddie Mac?
  • Was your loan sold to Fannie Mae or Freddie Mac prior to June 1, 2009?
  • Is your current loan-to-value greater than 80%?
  • Is your mortgage up-to-date with all payments made on time in the past 6 months, and no more than one late payment in the past 12 months?

What mortgage programs are ineligible for HARP 2?
If your mortgage is FHA, USDA, VA or a jumbo mortgage, you are NOT HARP-eligible.

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.  You may check to see if your loan is owned by either entity by using their websites – www.fanniemae.com or www.freddiemac.com.  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 HARP?
No, there is a series of criteria that determines eligibility.  Having your mortgage held by either of them is only a pre-requisite.

My mortgage is held by Fannie/Freddie.  Now what do I do?
Find a recent mortgage statement, and write on it whichever group backs your home loan so that you don’t forget when you talk to your lender and apply for a HARP refinance.

What if neither Fannie Mae nor Freddie Mac has a record of my mortgage?
If neither Fannie nor Freddie ha a record of your mortgage, then your loan is HARP-ineligible.  However, you may still be eligible for a “regular” refinance to lower rates.  Discuss options with your lender.

Is there a minimum credit score to use the HARP program?
No, there is no minimum credit score requirement with the HARP mortgage program.  However, you must qualify for the mortgage based on traditional underwriting standards.

What are the costs to refinance via the HARP program?
Closing costs for HARP refinances should be no different than for any other mortgage.  You may pay points, you may pay closing costs, and you may pay neither.  How your mortgage rate and loan fees are structured is between you and your lender.

What’s the biggest mortgage I can get with a HARP refinance?
HARP refinances are limited to $417,000, the conforming limit in Florida.

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 HARP 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 have lost home equity a chance to refinance at today’s low mortgage rates.

My mortgage was sold shortly after the HARP deadline of May 31, 2009.  Can I get a waiver or exception?
No, there are no “date exceptions” for HARP.  If your loan was not sold on, or before May 31, 2009 you cannot use HARP.

If I refinanced with HARP a few years ago, can I use it again?
No, you can only use the HARP program one time per home.

Is there a loan-to-value restriction for HARP?
No.  All homes – regardless of how far underwater they are – are eligible for the HARP program.

I am really underwater on my mortgage.  Can I really use HARP?
Yes you can.  The new HARP mortgage program specifically has no loan-to-value restriction so that homeowners in Florida, California, Arizona and Nevada can take advantage of it. You can be 300% loan-to-value, and still be HARP-eligible. HARP is now unlimited LTV for fixed rate loans with 30-year terms or less.

If I refinance with HARP using an ARM, do I still get “unlimited LTV”?
No, if you have an ARM for HARP, 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?
Maybe.  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 the reliability standards, no physical appraisal will be required. However, your lender may choose to commission a physical appraisal anyway.

Do I have to HARP refinance with my current mortgage lender?
Changes to the program announced in November 2011 include making it easier to refinance with any HARP lender.  So no, you do not have to refinance with your current lender.  This will allow you to shop for the best rate.

I put 20% down when I bought my home.  Now my home’s 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 $417,000, the conforming limit in Florida.

Can I do a cash-out refinance 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 a 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 residents.  The loan must meet typical program eligibility standards.

How long do I have to stay in my house if I use HARP on my primary residence?
There is no specific timeframe for which you’re required to stay in your home if you use HARP.  Just like any other mortgage, if you plan to stay in your home post-closing, it’s your primary residence.  If you plan to turn it into a rental, it’s an investment property.

Are condominiums eligible for HARP financing?
Yes, condominiums can be refinanced on the HARP program.  Warrant ability standards still apply.

Can I consolidate mortgages with a HARP refinance?
No, you cannot consolidate multiple mortgages with a HARP refinance program.  It’s for first liens only.  All subordinate/junior liens must be re-subordinated 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 limit of $417,000.

Am I eligible for a HARP refinance if I’m behind on my mortgage?
No, you must be current on your mortgage to refinance via HARP.  You must have made the last 5 out of 6 payments on time, and during the last year 11 out of the 12 payments must have been made on time.

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 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.

What is the maximum income that a HARP applicant is allowed?
The HARP refinance program has no maximum income limits.  “You can’t “earn too much” to qualify.

Is HARP the same as HAMP?
No.  HARP stands for Home Affordable Refinance Program.  HAMP stands for Home Affordable Modification Program.  Both programs are supported by the Making Home Affordable initiative, but that’s about where the similarities end.

Do HARP refinances use Loan-Level Pricing Adjustments (LLPAs)?
Yes, HARP mortgages use loan-level pricing adjustments, but LLPAs are dramatically reduced on a HARP refinance, and in some cased waived entirely.  For example, there are no LLPAs for fixed-rate HARP refinances with terms of 20 years or less.  For all other loans, loan-level pricing adjustments are capped at 0.75 points.

Do I have to refinance my mortgage with my current lender?
No, you can do a HARP refinance with any participating lender you want.

When does the HARP program end?
If you are HARP-eligible, you must close on your mortgage prior to December 21st, 2015.