Articles Comments

Debt Relief – Insolvency – Bankruptcy Information » Mortgage Refinancing » HARP Loans For Underwater Homeowners To Refinance Into Lower Mortgage Rates

HARP Loans For Underwater Homeowners To Refinance Into Lower Mortgage Rates

Article by Karan Agarwal

For much of the past year, mortgage rates have been at or near record low points. Unfortunately, many homeowners have been unable to take advantage of these rates due to declining home equity. Many homes have lost significant amounts of value since the housing market peaked in 2006. As a result, many homeowners now owe more on their mortgage than their home is worth (this condition is known as being “underwater” or “upside-down” on one’s mortgage). Homeowners who lack equity in their homes are frequently unable to meet the loan-to-value (LTV) ratios required by lenders in order to refinance their mortgages. These borrowers may be missing out on thousands of dollars worth of savings.

In response to this situation, the government created the Home Affordable Refinance Program (HARP). HARP was designed to allow homeowners with little to no home equity to refinance into lower mortgage rates. HARP loans are available to borrowers with LTVs of as much as 125 percent, although the maximum LTV it varies by lender.

Some of the eligibility requirements for HARP are:

The borrower’s mortgage must be owned by Fannie Mae or Freddie Mac
The home must be the borrower’s primary residence
The borrower must be current on their mortgage with no late payments in the last 12 month period

The new loan must lower the borrower’s monthly payments

For a complete listing of the HARP eligibility requirements, check out the Making Home Affordable Webpage here.

And these are just the primary eligibility requirements. There are others. Therefore, it is imperative that homeowners seek the help of professionals who are well versed in the demanding and fairly complicated HARP Loan process.

As you can see, the history of HARP is still evolving and subject to future changes. For now, HARP is due to expire on December 31, 2013, but if housing market conditions continue to decline, then hopefully the Federal Housing Finance Agency (FHFA) will continue to adjust to the new circumstances. Presently, a nice feature of HARP is that homeowners can avoid paying for an appraisal if a reliable automated property valuation model, such as Zillow, is available for your particular area, subject to the mortgage servicer’s discretion of course.

The significant changes in HARP eligibility requirements announced by President in October 2011 have led mortgage industry insiders to dub it HARP 2.0, even as the history of HARP is little more than two and a half years old. The Mortgage Bankers Association has previously estimated that $ 900 billion in mortgages will be originated in 2012 but with HARP 2.0 fast becoming effective, this number will certainly rise. Unfortunately, HARP was not designed to help homeowners already in foreclosure proceedings or in danger of being foreclosed upon.


To learn more about the mortgage options available to you, visit

More Harp Loan Articles


  1. Home Affordable Refinance Program (HARP) extended for underwater homeowners. The Home affordable refinance program or HARP has been extended for California homeowners who owe up to 105% of...

  2. HARP Program Changes To Refinance Underwater Mortgage Loans A lot of folks are confused about what the changes to HARP mean, and whether they can refinance their...

  3. Crazy New Govn’t Refi Program For Underwater Homeowners Harp 2.0 Step By Step Guide Homeowners Underwater On Their Mortgage Can Now Refinance Into 3% Rates, No Appraisal Required....

  4. Mortgage Refinancing Leads to Lower Interest Rates Article by David Nalin Typically, most Australians religiously made monthly instalment repayments until a home loan is paid. However, mortgage...

  5. Home Affordable Refinance Rates Offer Mortgage Relief With the advent of Obamas making home affordable program, many lenders have made its guidelines a part of their business...

Written by

Filed under: Mortgage Refinancing · Tags: , , , , , , , ,

One Response to "HARP Loans For Underwater Homeowners To Refinance Into Lower Mortgage Rates"

  1. [...] Read more … Share this:TwitterFacebookLike this:LikeBe the first to like this post. [...]

Leave a Reply

Connect with Facebook


You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Not finding what you're looking for?
Do a custom search of our entire site:

Get Adobe Flash player