On October 24th of 2011, the Federal Housing Finance Authority (FHFA) announced a key update to the already struggling Harp program, entitled HARP 2.0. It has taken a couple of months for my wholesale lenders to interpret the laws regarding this program, and what guidelines they will have in place for you to refinance your home.Basically, the HARP 2.0 program will now let you refinance your home loan, no matter how much upside down you may be. This will save the lenders roughly $8.5 billion in losses, and help rebound an already struggling housing market.
The HARP, or “Home Affordable Refinance Program”, 2.0 loan is a specific loan program that will allow homeowners who are struggling with their mortgage have the option to refinance their home. It is often geared towards homeowners who have failed to find assistance elsewhere. Generally the homeowner cannot qualify for a traditional refinance because they are struggling too much. The Harp 2.0 loan is generally the only program that will allow them and give them the opportunity to refinance.
There are two major changes between HARP 2.0 and 1.0. Unlike the previous version, Harp 2.0 allows the borrower with mortgage insurance to qualify for a refinance. This allows more homeowners to apply for the program. The largest difference is that the homeowner is now released of any responsibility for anything that had happened on the first loan. So, say there was a fraud on the underwriting of the first loan. The new lender is not responsible whatsoever. They will only be held accountable if there is any new fraud. This means that more lenders are a little more willing to help out.
With the new changes, there is also now new eligibility. To qualify, you must:
Here are some key points for the Government Rehabilitation Loan Program, A.K.A. Home Affordable Refinance Program, Obama Government Refinance Assistance, or Underwater Government Loan Assistance.