WHAT IS MAKING HOME AFFORDABLE (MHA) ALL ABOUT?
Making Home Affordable (MHA) Program is a critical part of the Administration’s broad strategy to help homeowners avoid foreclosure and stabilize the nation’s housing market.
Eligible homeowners can lower their monthly mortgage payments and get into more stable loans at today’s low interest rates. And for those homeowners for whom ownership is no longer affordable or desirable, the program can provide a way out that avoids foreclosure. There are also options for unemployed homeowners and homeowners who owe more than their homes are worth.
ABOUT SERVICERS
HOME AFFORDABLE REFINANCE PROGRAM (HARP)
I’m current on my mortgage. Is it possible to refinance my loan under HARP?
Yes. Eligible homeowners, who are current on their mortgages but have been unable to take advantage of lower interest rates because their homes have decreased in value, may have the opportunity to refinance. Through HARP, Fannie Mae and Freddie Mac will allow the refinancing of mortgage loans that they own or that they guaranteed in mortgage backed securities.
How do I know if my loan is owned or has been guaranteed by Fannie Mae or Freddie Mac?
Ask your mortgage lender or servicer. Both Fannie Mae and Freddie Mac have toll-free telephone numbers and web submission processes that also make this data available. Homeowners can enter information to determine if either agency owns or guarantees the loan. This information is not a guarantee of eligibility for a refinance under HARP, as other qualifying criteria must also be met.
For Fannie Mae:
1-800-7FANNIE (8am to 8pm EST)
KnowYourOptions.com/loanlookup ›For Freddie Mac:
1-800-FREDDIE (8am to 8pm EST)
FreddieMac.com/mymortgage ›
Will refinancing lower my payments? How might HARP benefit me?
HARP was created to help underwater and near-underwater homeowners refinance their mortgages. The objective of a refinance under HARP is to provide creditworthy homeowners the opportunity to get into a new mortgage with better terms.
Homeowners whose mortgage interest rates are much higher than the current market rate should see an immediate reduction in their payments. Homeowners who are paying interest only, have a low introductory rate that will increase in the future or face a balloon payment, may not see their current payment go down if they refinance to a fixed rate and payment. If you’re one of these homeowners, you could save a great deal of money by reducing the amount of interest you pay over the life of the loan.
Refinancing into a stable fixed-rate loan and avoiding future mortgage payment increases will likely improve your ability to sustain your mortgage payments over the long-term. When you submit a loan application, your lender will give you a “Good Faith Estimate” and a “Truth in Lending Statement” that includes your new interest rate, mortgage payment, and the amount that you will pay over the life of the loan. Compare this to your current loan terms. If it’s not an improvement, refinancing may not be right for you.
Will a refinance under HARP reduce the amount that I owe on my loan?
No. The objective of a refinance under HARP is to help homeowners get into more stable or more affordable loans. Refinancing will not reduce the principal amount you owe to the first lien mortgage holder or any other debt you owe.
I have both a first lien and a second lien mortgage. Do I still qualify for a refinance under HARP?
Your eligibility will depend, in part, on two additional requirements:
- The lender that has your junior lien mortgage must agree to remain in a junior lien position.
- You must be able to demonstrate your ability to meet the new payment terms on the first lien mortgage.
What are the interest rate and other terms of a refinance under HARP?
Your rate will be based on market rates in effect at the time of the refinance and you will be subject to any associated points and fees quoted by your lender. Interest rates may vary across lenders and over time as market rates adjust. The refinanced loans must have no prepayment penalties or balloon payments.
Can I get cash out of a HARP refinance to pay other debts?
No. The Home Affordable Refinance will not return cash to the borrower for the purpose of paying other debts.
I am delinquent on my mortgage. Will I qualify for a refinance under HARP?
No. Homeowners who are currently delinquent or have been more than 30 days overdue during the past 12 months generally will not qualify. Contact your servicerto see if a modification under the Home Affordable Modification ProgramSM (HAMP®) is an option for you.
Will I need mortgage insurance on a HARP refinance?
If your existing loan has private mortgage insurance, you will need the same amount of insurance coverage for a refinance under HARP. If your existing loan does not have private mortgage insurance, it will not be required as part of a refinance under HARP.
