HARP FAQ
The Home Affordable Refinance Program (HARP) is designed to help homeowners to refinance their mortgage regardless if they owe more than the home’s value. A Home Affordable Refinance allows refinancing to lower fixed rates from risky mortgage types such as interest only loans, or short term ARMs.
Question 1: Do I have to refinance through my current mortgage services or can I refinance through a different mortgage company?
Only Manually underwritten Refi Plus loans are limited to be originated by your current mortgage servicer
for your loan. Most DU Refi Plus refinances may be originated by any lender you choose that offers the HARP programs.
Question 2: How do I know if Fannie Mae or Freddie Mac is the investor of my mortgage?
Fannie Mae and Freddie Mac have online tools, the Fannie Mae Loan Lookup and Freddie Mac Loan Lookup, for borrowers to check the investor on their loan. The Loan Lookup is available at http://www.fanniemae.com/loanlookup/ and http://www.freddiemac.com/mymortgage/. Please remember that these tools indicates the investor on a property at a specific address, but do not determine refinance eligibility. Please submit your HARP application to determine if you qualify based on program guidelines. Borrowers can contact Fannie Mae by phone at 1-800-7FANNIE (1-800-732-6643) or by phone to Freddie mac at 1-800-424-5401.
Question 3: Is there a Combined Loan to Value CLTV Limit?
While there are currently restrictions for LTV limits at 125% for both the Fannie Mae DU Refi and the Freddie Mac Open Access programs, there are no combine loan-to-value (CLTV) limits. This means that the programs allow for subordinate financing of second mortgages. The programs do not allow you refinancing to combine both mortgages. Ask your loan officer about to help confirm the requirements of your second mortgage servicer to subordinate a mortgage.
Question 4: Will I qualify for a HARP refinance if I am currently behind on my payments?
The HARP program is designed to assist homeowners that are not experiencing troubles paying their mortgage. There must be no late payments on your loan for the past 12 months to qualify for a Home Affordable Refinance. If you are currently behind on your mortgage or have had late payments in the past year you may want to contact your current services to request information about the Home Affordable Modification Program (HAMP) which is designed to help homeowners whom are having difficulties paying their mortgage payments.
Question 5: Can I get cash out when I refinance through HARP?
Cash out refinancing is not allowed through HARP however the borrower may receive a maximum of $250.00 back at closing. If there is excess premium credit or if the loan size is too high, the lender may apply a principle curtailment of up to $2,000 or 2% of the principle balance (which ever is lesser). The borrower may receive closing fees paid up front such as an application fee or credit report fee at closing if documented by the lender.
Question 6: Do I have to have a job to qualify for HARP?
A source of income is required to be approved for a HARP refinance. The lender must at least provide a verbal verification of employment (VOE) as well as additional required income documentation according to the DU Underwriting Findings. Unemployment income is not eligible.
Question 7: Can a borrower be removed from the loans through a refinance?
Yes. A Borrower can be removed from the loan through a HARP transaction if they provide documentations that they have paid the loan on time with their own funds for the past 12 months.
Question 8: Can I refinance if my loan has mortgage insurance?
Yes. Mortgage insurance companies are participating in HARP however they may not re-issue the mortgage insurance policy to a new servicer. Speak with your loan officer and explain that your current mortgage has mortgage insurance and ask if you are eligible to refinance.
Question 9: Will my new loan have mortgage insurance?
If your current loan does not have mortgage insurance then you will not be required to have mortgage insurance on your new mortgage regardless of the loan-to-value ratio.
Question 10: Is there such thing as a Home Affordable Refinance with No Appraisal?
Yes. A HARP loan with no appraisal is may be possible if the automated DU findings allow for a field-work waiver. An appraisal waiver will typically only happen if the loan-to-value ratio is estimated to be under 125% LTV.