December 11th, 2018


Since it was launched in 2009, HARP has helped more than 3 million homeowners save about $2,400 annually on average. That's a huge number, but it's currently estimated that around 143,000 homeowners could still qualify for assistance through HARP.

However, the program is ending in 2018, and 2019 will see new programs introduced. The big question for those who owe more on a home than it is worth is whether or not now is the time to refinance through HARP or if it's better to wait for the new programs to be introduced.

Are You Eligible For HARP?

One of the first things you need to do is confirm that you're actually eligible for HARP. This doesn't mean that you'll be eligible for the new programs, but it's the first step toward making the right decision.

These requirements must be met in order for you to qualify for HARP:

Your mortgage must be from Fannie Mae or Freddie Mac

•It must have originated on May 31, 2009 or before

Your loan to value ratio must be 80 percent or more

You must be current on your mortgage payments and with no late payments in the last six months

You can't have more than one payment made late over the last 12 months

These guidelines are less restrictive than earlier requirements and were loosened in 2011 to make it easier for more people to qualify. But, this will change at the end of 2018.

What Are The New Programs?
These new programs are not being offered through the HARP or through government programs. Instead, Fannie Mae and Freddie Mac each have their own program.

If your mortgage is through Fannie Mae, you will use the High Loan To Value Refinance Option

If your mortgage is from Freddie Mac, the program is named the Enhanced Relief Refinance

Both of these are designed to replace HARP and follow similar structures and guidelines. However, instead of a loan to value of 80 percent, your loan to value must exceed 95 percent. This 15 percent increase immediately means that fewer people will be able to qualify for these programs, despite them offering something very similar to what HARP currently offers homeowners. Additional requirements include:

Must wait 15 months from the date a loan was sold to Fannie Mae or Freddie Mac before you can refinance

Only one payment can be missed in the last 12 month

No late payments in the last six months

A Fannie Mae or Freddie Mack mortgage that closed on October 1, 2017 or later.

That last note is important as well since it makes clear that those with newer mortgages are the focus of these programs. Those who have older mortgages may not be able to receive assistance through the programs.

Which Is The Right Call?

The bottom line here is that currently, HARP makes it easier and more likely that you can refinance. The new programs actually still offer similar results, only they are much more difficult to receive and qualify for. As such, anyone who is currently underwater in their mortgage should consider using HARP now, before it is too late.

Waiting too long could mean that you have a harder time getting refinanced or that you can't do it at all. If you're in a situation where your mortgage is for more than your home's value, our team is here and ready to help you find the solution that is right for you.