While home prices are on the rise in many real estate markets around the country, there are still homeowners who do not have enough equity in their homes to take advantage of today’s low mortgage rates. Some good news for these folks today came from the FHFA. The Federal Housing Finance Agency (FHFA) announced the extension of the Home Affordable Refinance Program (HARP) by two years to December 31, 2015. The program was set to expire December 31, 2013.
The HARP refi program has proven to be an important tool for underwater homeowners to achieve meaningful financial savings through interest rate reductions in a streamlined refinance transaction. You can view the full FHFA announcement here FHFA Extends HARP to 2015
To be eligible for a HARP refinance, homeowners must meet the following criteria:
- The loan must be owned or guaranteed by Fannie Mae or Freddie Mac.
- The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
- The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
- The current loan-to-value (LTV) ratio must be greater than 80 percent.
- The borrower must be current on their mortgage payments with no late payments in the last six months and no more than one late payment in the last 12 months.