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HARP Loans

The current housing crisis in America has left many homeowners in trouble on their mortgages. The government instituted the Home Affordable Refinancing Program (HARP) as a way to help these homeowners refinance their home. Unlike traditional mortgages, HARP loans are available for owners with no equity in their home. In fact, you can owe up to 125 percent of your home`s current value and still qualify for HARP.

Prerequisites for qualifying for HARP include having a Freddie Mac or Fannie Mae guaranteed mortgage with no late mortgage payments within the past year. You must be able to prove that refinancing your home will stabilize your financial situation and enable you to keep your home.

To apply for a HARP loan, contact your lender to discover if you have a Freddie Mac or Fannie Mae loan. Alternately, you can call Freddie Mac at 800-373-3343 or Fannie Mae at 800-732-6643 to ask if they guarantee your loan. Look over your payment history to ensure that you have made your payments within 30 days of their due date and get your home appraised to make sure that you don`t owe more than 125 percent of its market value.

If all of these things are in order, contact your mortgage company to see if it participates in HARP. If your lender does not, call other lenders or Freddie Mae or Fannie Mac to find a HARP participant. Submit your application along with substantiating documents such as income and expense lists, current load documents and property tax information.

HARP loans are more stable than many existing mortgages. Their lower, fixed-term interest rates prevent the fluctuating payments that owners of adjustable-rate mortgages see. Unlike the Home Affordable Modification Program (HAMP), HARP will not negatively affect your credit score because it does not modify your existing loan; you acquire a new loan. If your FICO score is low (below 620), you may not qualify for HARP.

The U.S. Department of Housing and Urban Development offers advisors that can help you decide if HARP will help your financial situation. If you do not qualify for HARP, they can show you other options that can help you keep your home. You can contact HUD at 888-995-4673 to speak with a trained housing advisor.

Home loans guaranteed by the Veteran`s Administration or the Federal Housing Authority do not qualify for HARP. If one of these agencies back your current loan, you should contact them to discuss your options for home refinancing. HARP is only available for primary residences. If you want to refinance a vacation home or rental property, you should contact your lender to see what your options are.

Our loans calculator can help you determine whether it would be better for your finances to refinance through HARP or continue paying your current mortgage. While financial problems can make you feel isolated and alone, you should realize that there are programs in place that can help you get back on your feet. The longer it takes you to look in to your options, the harder it can be to come up with a solution that can save your home from foreclosure.


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