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Can the HARP program save your home?

As an Illinois homeowner, you not only love your home, but it likely represents one of your biggest investments. Consequently, if you are thinking about bankruptcy as your only way out of overwhelming debt, you nevertheless want to save your home if at all possible. As Mortgage Reports explains, the Home Affordable Refinance Program may be the way you can do this.

HARP is the federal program that Congress established in 2009 to help homeowners such as you. Since then, over 3.3 million Americans refinanced their homes through HARP, often reducing their monthly mortgage payments by up to 30 percent in the process.

HARP qualifications

To qualify for a HARP refinance, you must be upside down in your home, meaning that its current market value is less than the amount you still owe on your mortgage. In addition, your mortgage payments must be up to date. If this describes your current situation, be aware that the home you refinance through HARP can be any of the following:

  • Your primary residence
  • Your second or vacation home
  • An investment property you own

Second mortgages

If you have a second mortgage on the home you wish to refinance, you still qualify for HARP, but you cannot refinance both your first and second mortgages together in one loan package. You can only refinance your first mortgage and you must obtain permission from your second mortgage holder.

Shopping for a lender

You must obtain your refinancing through a HARP-approved lender, but it does not have to be the company that holds your current mortgage loan. Since mortgage rates vary from lender to lender, you can shop around for the one offering the best rates. Also keep in mind that Congress changed the original HARP eligibility requirements in 2012, so even if a lender turned you down for HARP refinancing in the past, it never hurts to reapply now.

Unfortunately, the HARP program expires at the end of this year. Therefore, if you wish to avail yourself of its benefits, you must act quickly. This information is not legal advice, but it can help you understand the HARP process and what to expect.

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