HARP FAQ

Learn more about the HARP Program with our comprehensive list of frequently asked questions about HARP refinances and HARP eligibility requirements. If you have any questions that we have not answered in this comprehensive HARP Q&A page, please fill out the form on the right for a no-cost, no-obligation consultation with an experienced HARP loan officer. Please note that you can search this webpage by holding your “ctrl” button and pressing the “f” button. After that, simply type in the word or phrase you are looking for and hit enter.

What is the difference between the Home Affordable Refinance Program and the Making Home Affordable program?

There is no difference. They are the same program. The names HARP and Making Home Affordable are interchangeable.

Is there an easy way to determine if Fannie Mae or Freddie Mac holds my loan?

Yes, there is. The Fannie Mae and Freddie Mac websites have their own search functions that will allow you to see if Fannie or Freddie backs your loan. You can also check your eligibility on our site by Clicking Here. (link to Am I Eligible Page)

If my loan is backed by either of those government entities, am I instantly eligible for a HARP refinance?

There are quite a few requirements to determine your HARP eligibility. If your loan is backed by Fannie Mae or Freddie Mac, you have passed one of the key pre-requisites, but will still need to meet other eligibility requirements including having secured your mortgage on or before 5/31/09 and having never used HARP before.

How will my HARP refinance affect my current private mortgage insurance payments?

Your private mortgage insurance payments should not be affected by a HARP refinance. You will be required to maintain the same amount of coverage on your HARP loan as you did on your previous loan.

Can I refinance with HARP using a different lender than I used to get my original loan?

Yes you can. Many lenders throughout the country are choosing to participate in HARP. Any of these participating lenders are able to perform your HARP refinance; you are not limited to the lender who issued your original mortgage.

Does HARP let me refinance my interest only mortgage?

You can use HARP with an interest only mortgage as long as your interest only mortgage meets HARP’s basic eligibility requirements. Contact us today to get started with your HARP refinance.

Does HARP let me refinance my balloon mortgage?

You can use HARP with a balloon mortgage as long as your balloon mortgage meets HARP’s basic eligibility requirements. Contact us today to get started with your HARP refinance.

Is HARP the same thing as HAMP?

HARP and HAMP are two different programs under the Making Home Affordable program. HARP stands for the Home Affordable Refinance Program. HAMP stands for the Home Affordable Mortgage Program. The two programs are very similar, but have slight differences. Certain individuals, who have refinanced already using HAMP, may also be eligible to refinance under HARP. Contact us to learn if you qualify.

I was recently divorced. Can I use HARP to remove my ex-spouse from the mortgage?

Yes, you may remove your ex-spouse from the mortgage when you refinance via HARP as long as you also remove your ex-spouse from the deed to the property.

Will my HARP loan have Loan Level Pricing Adjustments?

This depends on the term length of your loan. There are no loan level pricing adjustments for fixed rate loans with a term length of 20 years or fewer. A HARP refinance typically has lower LLPAs, topping out around .75 points.

Do loans backed by Freddie Mac have a different HARP process than loans backed by Fannie Mae?

Not really. There are a few minor differences, but there is only a very small chance that any of these differences would apply to your transaction. In almost all situations, the process for Freddie Mac loans and Fannie Mae loans are the same.

Can I refinance with HARP if I have been missing payments?

Unfortunately, you will most likely not be eligible for HARP under these circumstances. HARP is only meant for borrowers who are current on their mortgage payments.

My bank told me that they will not finance my HARP loan. Am I allowed to apply with another lender?

Yes, applying with another lender is not only permitted, it is recommended! Your bank may not finance your HARP loan, but there are plenty of other banks that will. Even if your bank had approved your HARP refinance, you still should shop around in order to get the best rate.

My loan-to-value ratio is so high that my bank denied my HARP refinance. What options do I have now?

You seek a second opinion. Even though HARP does not have any restrictions on how high your LTV can be, some banks may be hesitant to refinance a high LTV loan. Shopping around with multiple banks can help improve your chances of being approved and finding the best mortgage rate.

My credit score is so low that my bank denied my HARP refinance. What options do I have now?

Just like the situation with a high LTV, if your low credit score caused the bank to deny your HARP refinance, try to seek a second opinion. HARP does not have any restrictions on how low your credit score can be. Shopping around with multiple banks can help improve your chances of being approved and finding the best mortgage rate.

What are the extra fees to refinance using HARP?

None! A HARP refinance costs the same as a conventional refinance. Some lenders will even allow you to roll your closing costs up into your HARP loan. If you are looking to refinance with HARP, contact us today!

Can I use HARP to push back my foreclosure proceedings?

No, you cannot use HARP to push back, delay, or prevent foreclosure on your home. The scope and mission of HARP were clearly defined when it was implemented, and stated that HARP’s purpose was to help responsible homeowners refinance at today’s low mortgage rates – even if they lost severe equity in their home as a result of the housing crisis.

How difficult is it to get a HARP loan?

Getting a HARP loan is not difficult as long as you meet the requirements. There are a variety of requirements that must be met in order to be declared eligible for a HARP loan. The first requirement is that your loan must be currently held by Fannie Mae or Freddie Mac. The second is that your loan must have been paid on time for at least 11 of the past 12 months. This includes timely payments for each of the past six months. Your loan also must have a note date of 5/31/09 or earlier. There are a few other requirements, such as whether you have used HARP before. If you meet these basic requirements, contact us today to begin your HARP loan application.

I have not lost any significant value in my home. Am I still allowed to refinance using HARP?

As long as you meet the basic eligibility requirements and your home has above an 80% LTV ratio, you should still be allowed to refinance your mortgage with HARP.

Can I use HARP to lower the remaining balance on my current mortgage?

No, you cannot use HARP to lower the remaining balance on your current mortgage. HARP essentially takes your current loan and allows you to lower the interest rate or change the loan type – not reduce any balance owed.

I closed on my home a few days after the May 31st, 2009 deadline. Would the government grant me any sort of exception?

The government does not allow any exceptions to the HARP deadline date. Those couple days may not seem to mean much, but once the government establishes a deadline, they enforce it very strictly.

What led the government to choose the 5/31/09 deadline for HARP eligibility?

There has never been an official answer from the government on this matter, but the general understanding is that people who bought their houses before 5/31/09 were most heavily affected by the housing bubble and by questionable predatory lending practices.

Interest rates have dropped even lower since I last used HARP to refinance my home. Can I use HARP to refinance again?

You may not. HARP can only be used once per property.

What is the maximum allowable loan to value (LTV) ratio that HARP will permit?

For adjustable rate mortgages, the maximum allowable LTV ratio is 105%. Fixed rate loans or 30 years or less, however, are not subject to any maximum LTV ratio. No matter how much equity your home has lost, you can still refinance under HARP.

If there is no LTV cap for fixed rate loans, how did my lender deny my HARP loan?

Even though there is no LTV cap for HARP eligibility if you refinance into a fixed rate loan, lenders may still choose to deny your HARP loan based off of their underwriting risk tolerance. Mortgages with higher LTV ratios have more risk because there is less collateral in the event of a payment default, and so banks may choose to deny HARP refinances if the property has an LTV ratio that does not fit their risk tolerance. Different banks have different risk tolerances, so if you are denied at your original bank, seek out as many other options as you can. This will not only help you get approved, but it will help you get the best interest rate.

With the recent real estate market recovery, my home is finally gaining value. Can I still refinance using HARP or will I have to do a conventional refinance?

In many cases, you will still be able to use HARP. If your home is just now beginning to gain value again, there is a strong possibility that you are still above the 80% LTV minimum. If your home has an LTV ratio of below 80%, then your chances of being approved for a HARP refinance diminish significantly.

Why would I compare rates from multiple banks?

Each bank has slightly different interest rates. Shopping around and comparing rates from as many lenders as possible will help ensure that you are getting the best interest rate possible for your HARP refinance. Contact us today to get started with your lender search!

What is the LTV ratio cap if I refinance into an adjustable rate mortgage instead of a fixed rate mortgage?

Adjustable rate mortgages are treated differently than fixed rate mortgages under HARP. The LTV ratio cap for an adjustable rate mortgage is only 105%, as compared to fixed rate mortgages which have no cap.

I wanted to refinance into a fixed rate loan using HARP, but my bank is saying that I must have a 105% LTV ratio. I thought that was just for ARMs?

The 105% LTV ratio cap is specifically for determining eligibility with adjustable rate mortgages. If you are refinancing into a fixed rate mortgage, there is no official cap, but some banks may still choose to put a cap on the LTV ratio that they will finance. This bank is particularly picky, and you should definitely shop around because there are plenty of banks that will gladly refinance your loan no matter the LTV.

I have a 30 year mortgage, but would like to cut my payment term down to 15 years. Can I do this when I refinance with HARP?

When refinancing with HARP, you are allowed to lower your payment term, but this will result in higher monthly payments. You must confirm your ability to pay the monthly increase resulting from your shorter term with your lender, and must be re-approved if your new monthly principal plus interest payment is more than 20% higher than your current principal and interest.

My previous loan did not require mortgage insurance, but my house is now underwater. If I refinance with HARP, will I now be required to pay mortgage insurance?

No, you will not. If your old loan did not require mortgage insurance then your refinanced HARP loan will not require mortgage insurance either.

Does HARP allow you to refinance 80/20 and 80/10/10 mortgage loans?

Yes, it does. As long as you meet the HARP eligibility requirements (loan backed by Fannie or Freddie, mortgage date no later than 5/31/2009, etc.), neither an 80/10/10 mortgage nor 80/20 mortgage will hurt your HARP eligibility.

My bank denied my HARP loan because they claim that I have mortgage insurance. I checked, and do not pay any mortgage insurance. How could this be?

If your lender is telling you that you have mortgage insurance, it is highly probable that you do. Many people do not realize that there are two main variations mortgage insurance – Lender Paid Mortgage Insurance (LPMI) and Private Mortgage Insurance (PMI). If you have LPMI, your lender is making the payments on your behalf, so you may not even be aware that you have it.

Having LPMI or PMI does not make you ineligible for HARP, but certain lenders may reject you based off their risk tolerance policy. If your HARP refinance is rejected by a lender because you have PMI or LPMI, keep trying. There are lenders out there who would love to help with your HARP refinance.

Can I use the Home Affordable Refinance Program to refinance my current loan even if it has mortgage insurance?

Your PMI or LPMI will not make you ineligible for HARP, as long as you meet the other eligibility requirements. The one stipulation is that the mortgage insurance coverage on your HARP loan must be at least equal to the mortgage insurance coverage on your current loan.

Who selects the extent of my LPMI coverage when I refinance via HARP?

In many cases, your loan officer will help choose your LPMI coverage. Just make sure that you are honest with your lender about if you have LPMI on your current loan. Your HARP refinance could be delayed significantly if you are dishonest at the beginning and it later surfaces that you have LPMI.

How can I determine if my current mortgage has Lender Paid Mortgage Insurance?

In most cases, your lender will include a disclosure in your closing documents that declares your LPMI policy. If you still have your closing documents, you should check for this disclosure. If your closing documents do not include any disclosure, you probably do not have LPMI. If you still think that your loan has LPMI, call your lender to confirm your suspicions.

I bought an expensive home, and want to refinance my mortgage under HARP. What is the maximum amount I can refinance?

Every area in the U.S. has its own laws and standards, but in the majority of the country, the conforming limit is roughly $417,000. In wealthier areas that have higher value homes, the conforming loan limit may be as high as $625,500. We recommend that you check the limits in your area by clicking here if your loan is around these limits.

Can I do a cash-out refinance if I use HARP?

HARP only allows for normal rate-and-term refinances. You cannot do a cash-out refinance if you are using the HARP for your refinance.

I have a second home that I use as a vacation property. Can I refinance that residence with a HARP loan?

 

Yes, you can. No matter whether your home is a second home, investment property, or primary residence, you can still refinance your first mortgage on that property with HARP as long as you meet the eligibility requirements.

My bank is saying different things than what I am reading here. Why is that?

If your bank is telling you different things than what we have outlined in these frequently asked questions, there is a high probability that they are unfamiliar with HARP refinances. It is also possible that your bank has separate standards beyond what is outlined in the HARP eligibility requirements. Either way, you should try contacting another bank to compare information. We encourage all people reading this to contact us today. We are experienced in HARP refinances, and are happy to help visitors understand more about HARP.

Am I eligible for HARP if I have a condominium?

As long as you meet HARP’s eligibility requirements, it does not matter if you have a house or condo. You should be easily able to refinance either type of residence.

My bank just denied my HARP refinance, and said it was because I have a condo instead of a house. Why does that matter?

Your bank probably does not like financing condominiums. As long as you meet all of HARP’s eligibility requirements, you should be able to shop around and find a different bank that will be willing to finance your HARP refinance.

Do I pay any extra costs in order to take advantage of the refinance benefits under HARP?

A HARP refinance has almost identical costs to a conventional refinance. There is potential that you  will be responsible for paying points or closing costs. You may also be able to qualify for a zero-cost HARP refinance program. Contact Total Mortgage Services to learn more and to determine your eligibility.

Why is HARP sometimes called “DU Refi Plus” mean?

Fannie Mae branded their version of HARP under the name “DU Refi+,” also known as “DU Refi Plus.”

Why is HARP sometimes called “Relief Refinance”?

Freddie Mac branded their version of HARP under the name “Relief Refinance.”

Am I eligible for a HARP refinance even if I have a 40 year mortgage?

You sure can! With HARP, you even have the option to refinance into a shorter mortgage term as long as you stick with a fixed rate.

Will my HARP eligibility allow me to consolidate my first mortgage and second mortgage

HARP was created allow homeowners whose homes had lost significant value since the housing bubble burst to refinance their first mortgages at today’s low interest rates. HARP does not cover second mortgages or allow for consolidation of your two mortgages.

Will my HARP eligibility also allow me to refinance my second mortgage?

The Home Affordable Refinance Program is not engineered to provide any relief for second mortgages. HARP will allow you to refinance your first mortgage if your home is underwater, but will not allow you to refinance your second mortgage or consolidate your second mortgage into your first mortgage.

When I refinance my first mortgage with HARP, what happens to my second mortgage?

When you refinance your first mortgage with HARP, your second mortgage will not be affected at all. HARP only allows you to refinance first mortgages, and does not deal with second mortgages at all. In order to keep the transaction going as smoothly as possible, you should tell your loan officer if you have a second mortgage.

My second mortgage company is preventing me from refinancing my first mortgage using HARP. Are they allowed to do that?

Unfortunately, they are allowed to do that; however very few mortgage companies would actually take this action. In many situations, it will not benefit your second mortgage company to prevent you from refinancing your first mortgage via HARP, but they are legally entitled to do it. Refinancing your first mortgage should benefit your second mortgage company because you should ideally be saving money each month due to the refinance, and be in a better financial position to make your mortgage payments.

I looked it up, and my first mortgage is held by Fannie/Freddie, but my second mortgage is not. Does this matter?

Nope, you’re fine! HARP only looks at your first mortgage. You are not allowed to modify your second loan in any way using HARP, so it is nullified as a factor. You can still refinance your first mortgage even if your second loan is not through Fannie or Freddie.

Great, my bank does not do HARP loans… what can I do?

If your bank is not set up to handle your HARP refinance, just shop around for a bank that is! Not all lenders participate in HARP, but the ones that do participate would love to have your business.

What if I cannot afford to pay closing costs?

No problem. HARP allows you to roll your closing costs up into your loan so that you do not have to pay them at closing. Just make sure that the closing costs do not cause your loan to exceed the conforming limit in your area. Most of the U.S. has a limit of $417,000, but some pricier markets have expanded limits as high as $625,500.

Can I still apply for a HARP refinance even if I am unemployed with no current income?

Believe it or not, there are no employment or income requirements to use HARP. In many instances, you will not have to be re-qualified for your HARP loan, so your income will not affect you at all. If you are scared that your unemployment or income will cause you to be denied a HARP loan, make sure that your monthly payment of principal and interest does not increase by more than 20%. In such an instance, you will need to be re-qualified.

My lender needs to verify my income to approve me for a HARP mortgage. What will they want from me?

While HARP has no income requirements, your lender will most likely ask for a verification of your income as part of your approval for a loan. The most common way of verifying your income is to present your W-2 statement from each of the last two years, a recent paystub to show that you are actively employed, and your most recent federal tax return. If you cannot verify your income at all, you will most likely need to show at least one year’s worth (12 months) of principal, interest, taxes, and insurance, also known as PITI. Many lenders will consider this sufficient if you have that much money available.

Do you have to earn a certain income to be eligible for HARP?

HARP has absolutely no income requirements. This means that a low income or high income cannot hurt your qualification for HARP. You just must make sure to accurately disclose your income when applying for a HARP loan.

If I refinance via HARP, will I need to have a physical appraisal performed on my property?

HARP does not require a physical appraisal, but your lender might. Certain lenders might want to make sure that your home is in decent condition, or at least still standing!

What’s the difference between the Home Affordable Refinance Program and the Streamline Refinance Program from the Federal Housing Administration?

HARP is a program for loans backed by Fannie Mae and Freddie Mac. FHA Streamline Refinances run through the Federal Housing Administration. Beyond that difference, the programs are actually quite similar.

You mentioned that HARP is for loans backed by Freddie Mac and Fannie Mae. What about Ginnie Mae?

No, Ginnie Mae is technically a FHA mortgage, not a conventional mortgage backed by Fannie Mae and Freddie Mac. Ginnie Mae loans can often be refinanced through the FHA Streamline Program.

Do I have to use my current lender to refinance with HARP? They are telling me that I cannot choose any other bank.

Your lender is most likely misinformed or trying to deceive you. Just like any other refinance, you should be able to choose the lender for your HARP refinance. If you are not sure whether you can refinance with another bank, call Total Mortgage Services and let us help you find out.

I think my credit score is too low to use HARP. What can I do?

Lucky for you, there are no minimum requirements to refinance with HARP! You will still maintain eligibility for the program, but certain lenders may be hesitant to finance your transaction if you have a low credit score. Other banks have higher risk tolerances, so if you are rejected from one bank, keep trying until you find one that will approve you.

My bank was trying to convince me to do a HARP refinance, but their rate seems so high that I’m not sure if it’s worth it. Can I get a lower rate somehow?

The best way to get a lower rate is to shop around and compare multiple lenders. Once you find a rate you are happy with, make sure that the lender you chose has experience performing HARP refinances. The process of a HARP refinance is different from that of a conventional refinance, and can cause an inexperienced loan officer to make foolish mistakes that delay or can cause your transaction to fall apart.

Make sure to look at Total Mortgage when shopping around. Total Mortgage has significant experience with HARP refinances, and boasts some of the most competitive rates in the mortgage industry.

Is it too late to refinance with HARP?

No, HARP does not end until 1/1/16. There is still plenty of time to refinance with HARP, but make sure you don’t wait too long! Rates are at record lows.

How can I start the process?

To get started applying for a HARP refinance, contact us today. An experienced loan professional will call you within 24 hours to begin the HARP application process.