Washington does love their acronyms. I’m sure they pay some consultant big bucks to come up with these catchy names. This one, the Home Affordable Refinance Program 2 (HARP 2), stands to help more underwater homeowners than its forerunner, Version 1.0. Under the revised guidelines, borrowers can refinance to a lower rate with comparatively few obstacles. In many cases, no appraisal is required, and credit scores are less of an issue than with the previous version of the program.
There are still some problems with HARP 2. For one thing, if your loan is not owned by Fannie Mae or Freddie Mac, you’re out of luck. If your loan did not go into the guarantee “pools” until after June 1, 2009, you’re out of luck as well.
HARP may be receiving some additional, welcome tweaks. Twelve members of the Senate Banking committee have just written to Edward DeMarco, acting head of the Federal Housing Finance Agency, urging him to 1) Reduce or eliminate price adjustments to HARP loans; 2) Remove the possibility of loan originators being required to buy back loans that go into default after the refinance; and 3) Make HARP refinances available to borrowers who actually have equity in their properties (yes, there are some).
HARP 2 has opened the door to many previously ineligible homeowners, who could benefit from a refinance, but were locked out because of negative equity, low FICO scores, high debt-to-income ratios—or all three. If you’d like to find out whether you qualify for a HARP refinance, just give us a call at 925-560-7644.
Now if they’d only find a way to open the door to homeowners whose loans were not sold to Fannie or Freddie, or whose loans were funded after that arbitrary deadline of June 1, 2009.
A guy can dream, can’t he?