HARP is a Federal Mortgage Program that has been in place since the Obama Administration. But all these years, it has been rarely talked about and the program will expire this year (2018).

Congress just made it re-surface and is fully backing it up. Homeowners will now be able to reduce their monthly mortgage bills and keep the difference in their pocket for much needed home repairs.

Do I qualify for HARP?

A HARP loan looks a lot like any other mortgage. Since HARP mortgages are backed by Fannie Mae and Freddie Mac, the underwriting process will resemble that of any other conventional mortgage. There will be loan disclosures to sign and supporting financial documentation to remit. Mortgage lenders are looking for borrowers with solid incomes, good assets and quality credit scores.

Here is the full list of HARP requirements:

  • The mortgage 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
  • Borrowers must be current on their mortgage payments with no payments more than 30 days late in the last six months and no more than one late payment in the last 12 months
  • Eligible property types are primary residence, one-unit second home and one-to-four-unit rental property
  • The current loan-to-value (LTV) ratio must be at least 80 percent. There is no maximum LTV limit for a new fixed-rate mortgage. The maximum LTV for a new adjustable-rate mortgage is 105 percent.
  • You cannot have previously refinanced under HARP (unless it was a Fannie Mae loan refinanced under HARP between March and May 2009)

If your mortgage is less than $625,000, your chances of qualifying for HARP could be high.

However, the banks are not happy about this. Here’s why:

  1. The HARP Federal Program makes it easier to qualify for lower mortgage rates
  2. You have the option to shop other lenders

You think banks like the above? Rest assured, they do not. They would rather make more money by keeping you at your current higher rate. The middle class seems to miss out on everything, and jumping on this benefit is a no-brainer.