HARP Now Expected to Reach Twice as Many Homeowners

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By Jon Prior

The expanded Home Affordable Refinance Program will likely reach more underwater borrowers than its architects originally thought.

"We said we would double the number from what we've already done under HARP, which would mean we'd do another 900,000 under the expanded program. I think we're actually trending above that now," said Andrew Bon Salle, head of the Fannie Mae underwriting and pricing group, in an interview.

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HARP Now Expected to Reach Twice as Many Homeowners

Purpose: Lower your monthly mortgage payments.

General eligibility guidelines:
• You obtained your mortgage on or before January 1, 2009.
• You owe up to $729,750 on your primary residence or single unit rental property
• You owe up to $934,200 on a 2-unit rental property; $1,129,250 on a 3-unit rental property; or $1,403,400 on a 4-unit rental property
• The property has not been condemned
• You have a financial hardship and are either delinquent or in danger of falling behind on your mortgage payments (non-owner occupants must be delinquent in order to qualify).
• You have sufficient, documented income to support a modified payment.
• You must not have been convicted within the last 10 years of felony larceny, theft, fraud or forgery, money laundering or tax evasion, in connection with a mortgage or real estate transaction.

Next Steps: Contact your mortgage company to see if you are eligible. Also, fill out the following forms:

Request for Mortgage Assistance Form
IRS Form 4506T-EZ   or 4506-T
Verification of Income

See the Making Home Affordable website for more details.

Purpose: To allow homeowners with Fannie Mae or Freddie Mac-guaranteed mortgages to refinance into a lower rate. The program primarily targets "underwater" homeowners, borrowers who owe more on their mortgages than their homes are worth. The Obama administration recently lifted a cap that prevented homeowners whose mortgages were more than 125 percent the value of their homes from qualifying. That has extended the program to a much wider swath of homeowners.  

General eligibility guidelines:
• The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
• The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009.
• The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009.
• The current loan-to-value (LTV) ratio must be greater than 80%.
• The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.

Next Steps: Determine if Fannie Mae or Freddie Mac owns your mortgage using their Loan Lookup Tools. You can also contact your current mortgage servicer or another that is approved by Fannie Mae or Freddie Mac to inquire about HARP. You can alsocompare rates and costs with additional mortgage companies to ensure best refinance terms.

See the Making Home Affordable website for more details.

Purpose: To allow homeowners with FHA-insured mortgages worth more than their homes to refinance into a  lower rate.

General eligibility guidelines:
• Your mortgage is not owned or guaranteed by Fannie Mae, Freddie Mac, FHA, VA or USDA.
• You owe more than your home is worth.
• You are current on your mortgage payments.
• You occupy the house as your primary residence.
• You are eligible for the new loan under standard FHA underwriting requirements.
• Your total debt does not exceed 55 percent of your monthly gross income.
• You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.

Next steps: Talk to your mortgage owner to see if they want to participate in an FHA refinance. Or talk to an HUD-approved housing counselor for free.

See the Making Home Affordable website for more details.

Purpose: To help people who can no longer afford their mortgages to transition to more affordable housing. The program provides two options: a short sale or a Deed-in Lieu of foreclosure.

General eligibility requirements:
• You live in the home or have lived there within the last 12 months.
• You have a documented financial hardship.
• You have not purchased a new house within the last 12 months.
• Your first mortgage is less than $729,750.
• You obtained your mortgage on or before January 1, 2009.
• You must not have been convicted within the last 10 years of felony larceny, theft, fraud, forgery, money laundering or tax evasion in connection with a mortgage or real estate transaction.

Next steps: Contact one of the HUD-approved housing counselors for free to discuss your options. When it's time for HAFA, be prepared to provide the following:

Request for Mortgage Assistance (RMA)

For more information, see the Making Home Affordable website.

Purpose: Get free advice on buying a home, renting, defaults, foreclosures, and credit issues.

General eligibility guidelines: This service is open to everyone.

Next Steps: Search for a HUD approved housing counselor near you, or call 888-995-HOPE (4673) for free, comprehensive assistance around-the-clock.

Purpose: To help unemployed people manage mortgage payments. The program can either reduce payments or suspend them altogether for 12 months or more.

General eligibility guidelines:
• You are unemployed and eligible for unemployment benefits.
• You occupy the house as your primary residence.
• You have not previously received a HAMPSM modification.
• You obtained your mortgage on or before January 1, 2009.
• You owe up to $729,750 on your home.

Next steps: Contact a HUD-approved housing counselor at 888-995-HOPE (4673). They will help you understand your options, design a plan, and prepare your application. You can also contact your mortgage servicer to see if you are eligible.

See the Making Home Affordable website for more information.

Purpose: To recover damages if financially injured during a foreclosure from 2009 to 2010.

General eligibility guidelines:
• Your mortgage loan was active in the foreclosure process between January 1, 2009 and December 31, 2010.
• The property was your primary residence.
• You had one of the providers listed here.

Next Steps: Fill out the form for a free independent foreclosure review here. Make sure to send the form by September 30, 2012.

Click here for more info.

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The Federal Housing Finance Agency eased HARP eligibility requirements last year for Fannie Mae and Freddie Mac mortgages. It reduced upfront fees, eased buyback risk and eliminated the 125 percent loan-to-value ratio ceiling. Most banks implemented the changes in March.

Read more on this story at HousingWire.

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