In this day and age, loans can be an extremely confusing fact in life. One loan that has been coming under question recently is the Harp 2.0 loan. With many confused loan holders, there has been many questions regarding this loan and to how it works.
The HARP, or "Home Affordable Refinance Program", 2.0 loan is a specific loan program that will allow homeowners who are struggling with their mortgage have the option to refinance their home. It is often geared towards homeowners who have failed to find assistance elsewhere. Generally the homeowner cannot qualify for a traditional refinance because they are struggling too much. The Harp 2.0 loan is generally the only program that will allow them and give them the opportunity to refinance.
There are two major changes between HARP 2.0 and 1.0. Unlike the previous version, Harp 2.0 allows the borrower with mortgage insurance to qualify for a refinance. This allows more homeowners to apply for the program. The largest difference is that the homeowner is now released of any responsibility for anything that had happened on the first loan. So, say there was a fraud on the underwriting of the first loan. The new lender is not responsible whatsoever. They will only be held accountable if there is any new fraud. This means that more lenders are a little more willing to help out.
With the new changes, there is also now new eligibility. To qualify for the new Harp 2.0 loan, you must:
- Be owned/guaranteed by Freddie Mac or Fannie Mae.
- Have been previously sold to Fannie Mae or Freddie Mac on or before May 31st, 2009.
- You must not have been previously financed under HARP, unless it was a Fannie Mae loan that was refinanced under Harp between March and May of 2009.
To qualify, you must have a FICO credit score of at least 620 and you must remember that these are full doc loans. Homeowners must be able to provide income and assets in order to qualify for the benefits of the reduced payments through Harp 2.0.
If you or someone you know is interested in learning more about the Harp 2.0 loan, contact me, Brian Quigley, and we can get started on refinancing and lowering your payments today.