The Home Affordable Refinance Program (HARP) has been launched for some two years, but had little effect and fell far short of its original goal of helping millions of distressed homeowners, according to Chief Economist Bob Walters of Quicken Loans, shutting out large numbers of homeowners due to restrictive eligibility requirements. To redress this issue, on November 15, 2011, President Obama announced a newer version of HARP, dubbed HARP 2.0. The new HARP 2.0 guidelines offer eligibility requirements that are more suitable to the present real estate conditions, targeting homeowners who are under water.
It can be argued that HARP 2.0 was designed to reward responsible homeowners by lowering their monthly mortgage payments, or getting them out of crushing ARMs and into more stable and affordable mortgages.
HARP 2.0 has been officially open for business since March 19, 2012, and the new computerized system is designed to drastically speed up the application process, thereby be able to increase the volume substantially.
HARP 2.0 Eligibility Guidelines:
- The mortgage must be owned or guaranteed by Fannie Mae or Freddie Mac by May 31, 2009. If unsure of this, their contact information is:
- http://www.fanniemae.com/loanlookup/ or 1(800)7FANNIE between 8:00 A.M. and 8:00 P.M. Eastern Time
- http://www.freddiemac.com/corporate/or 1(800)FREDDIE between 8:00 A.M. and 8:00 P.M. Eastern Time
- Currently, there is no limit to the Loan to Value ratio, unlike the 125% limit imposed under the original HARP program, opening this program to a much larger number of homeowners.
- Homeowners must not have had one late payment in the previous six months, and no more than one in the previous twelve months.
- Fees can be waived for borrowers willing to accept shorter term mortgages, as such 20 or 15 year loans.
- Appraisals are mostly not required, thus bypassing at least one upfront payment.
- The present mortgage also must conform to current conforming loan limits. Here is where you can go to verify this requirement: http://themortgagereports.com/loan-limits/
- HARP 2.0 is also open to all mortgage companies, as compared to a restricted number of servicers previously. PMI may no longer be an issue either. Homeowners who are stuck with a loan servicer that does not offer the HARP 2.0 program can still qualify with another loan servicer.
If your mortgage is currently with any of the banks below or is serviced by such, the following bank phone numbers are only to be used for inquiries about HARP 2.0 guidelines. No new Loan or comparison shopping, please.
Bank of America: 1(800) 846-2222
Wells Fargo: 1(877) 937-9357
Chase: 1(800) 848-9136
Citigroup: 1(800) 283-7918
U.S. Bank: 1(866) 932-0462
Erin Lantz of Zillow suggests you contact your current loan servicer first to discuss your situation, as they can help with the loan application process. However, keep in mind that a HARP 2.0 loan is not any different than any other mortgage, thus shopping for the most advantageous mortgage is highly recommended.
HARP 2.0 is due to expire toward the end of 2013, and borrowers with a less than stellar credit history need not be shut out of the program, as some lenders are currently offering HARP 2.0 loans with little credit consideration.
These new HARP 2.0 guidelines are much more lenient than the previous ones, so for those homeowners who believe they may qualify, there are numerous mortgage broker sites that offer a HARP 2.0 eligibility calculator.