Huntington Beach, CA: Are you wondering if you or someone you know will be able to take advantage of the new revisions to the HARP program that were just announced last week and are scheduled to become available to borrowers this December? The Home Affordable Refinance Program, or “HARP,” is the revised program for struggling homeowners that President Obama has been talking a lot about recently. While media coverage has been quite positive and made it seem like this is the magic cure for all homeowners who owe more than their homes are currently worth, most still will not qualify for it.
The problem is that the new HARP program is still only available to loans that are backed by Fannie Mae or Freddie Mac. Some of the most upside-down homeowners who bought back at the peak in 2006 and 2007 are also the least likely to have a loan backed by one of these government agencies. A high percentage of the loans were held by private investment firms in their mortgage backed portfolios and are not eligible for HARP.
In addition, only loans that were delivered to Fannie or Freddie prior to May 31, 2009 are eligible. If you bought your house or refinanced your existing mortgage after this date you will remain ineligible.
Unfortunately, having gotten your loan prior to this date does not immediately guaranty your eligibility either. If your loan was originated prior to May 31, 2009 but not sold to Fannie Mae until after that date, you would also not be elegible. That is because the HARP program goes by the date Fannie or Freddie acquired the loan, not when it was originated. The May 31st date is a 3 month extension from the previous guideleines and will help a few more homeowners qualify.
Another important change is that the program previously allowed refinancing up to 125% of a property’s value. This means that someone who owed $600,000 on a $500,000 home could get help, but someone who owed $650,000 on that same home could not. Under the new HARP program there is no maximum. Even someone who owes $600,000 on a home currently valued at $300,000 can choose to refinance under this new program and take advantage of today’s historically low rates. Of course they will need to be one of the relatively few who’s loan actually qualifies.
Whether your home may be valued at four million or four hundred thousand you need up-to-date expert advice to help you determine your best option with regard to refinancing or short selling. As a Certified Distressed Property Expert who has counseled and helped numerous homeowners who have wrestled with this difficult problem, Tony is also here to help you. Give him a call or email him today.
Broker Associate, Remax Select One