HARP Guidelines

HARP Eligibility Guidelines

The Home Affordable Refinance Program (HARP), launched jointly by the Federal Housing Finance Agency (FHFA) and the US Treasury Department set certain new eligibility guidelines for California homeowners who had bought houses on loans and were subsequently unable to be eligible for refinancing because of downward spiraling home values. This was a major hindrance in refinancing their present mortgages with lower interest rates and/or having a more valuable mortgaged product.

With changes announced in HARP eligibility guidelines (now called HARP 2.0), more and more home owners will now be eligible for HARP.

The elimination of the 125% loan-to-value for fixed rate Freddie Mac or Fannie Mae mortgages and the exclusion of appraisals for new properties where there is already a reliable Automated Valuation Model or AVM are two such major changes that will make more people eligible.

Risk-based fees that discouraged borrowers from taking short-term mortgages have been eliminated and this will help those with loans valued at more than the value of their house.

This will reduce not only interest rates but also lower monthly installment payments, creating equity faster.

The goal of the newly modified HARP 2.0 Program is to help stabilize the real estate market and encourage more people to buy homes on loans.

HARP Eligibility/Non-Eligibility Basic Guidelines

1. Your loan must be backed by Freddie Mac or Fannie Mae

2. Freddie or Fannie should have bought your mortgage prior to June 1st, 2009.

3. Borrowers must be current on their mortgage for the last six months, and have no more than  one late payment over the past year.

4. The mortgage must not have already been refinanced through HARP in the past, unless it  happens to be a Fannie Mae loan that underwent a HARP refinance between March and May 2009.

5. Must Not be a USDA, FHA or Jumbo Mortgage

6. If the California homeowner refinances into a fixed-rate mortgage, no Loan-To-Value (LTV) limit  applies. However, if the new loan is an adjustable-rate mortgage, the borrower’s LTV cannot exceed  105%. Western Pacific Home Loans