HARP Loan Program & Today’s Mortgage Refinance Rates

Dan Green
The Mortgage Reports contributor

HARP Program Helps Underwater Homeowners

The Home Affordable Refinance Program (HARP) allows today’s homeowners to refinance into lower mortgage rates even if they owe more on their loan than their home is worth.

The program was first launched in 2009 and marked a shift for conventional lending which had always said that homeowners required equity to make a refinance. 

But the HARP program does more than just help “underwater” homeowners. It’s available to homeowners who have lost equity in their home since the date of purchase, too.

Via HARP, homeowners with little or no equity can refinance into today’s low mortgage rates without having to pay new private mortgage insurance (PMI); or to increase existing PMI coverage.

Click to get today's HARP refinance rates (Feb 24th, 2020).

The Birth Of The HARP Program

Last decade, as the economy soured and headed to recession, home values fell in nearly all U.S. cities. In some areas, values fell minimally, losing only several percentage points.

In other areas, home values fell by fifty percent or more.

Meanwhile, as the economy was shrinking, current mortgage rates were dropping to all-time lows. With little or no home equity of which to speak, though, homeowners found themselves unable to refinance via any traditional conventional programs.

Enter Congress.

To help these homeowners who had lost their home equity, the U.S. government launched the Home Affordable Refinance Program (HARP).

The HARP program promised $3,000 in annual savings per household which Congress believed would spur consumer spending; and, help to lessen the duration of recession.

With HARP’s passage, millions of homeowners were immediately eligible to lower their mortgage rates — even if they had no home equity — helping to make homes affordable across the country.

Since its launch, more than 3.1 million homeowners have used the HARP refinance program to save money. Today’s typical HARP refinance saves as much as 30% annually.

Click here to check today's HARP rates. (Feb 24th, 2020)

Qualify For The Home Affordable Refinance Program

The Home Affordable Refinance Program (HARP) is a streamlined refinance program, structured in a similar fashion as the Federal Housing Administration’s FHA Streamline Refinance and the Department of Veterans Affairs’ VA Streamline Refinance.

The HARP program rarely requires an appraisal, and only limited documentation is required to get approved.

However, there is a series of basic eligibility criteria for the program which all borrowers must meet.

  1. Your loan must be backed by Fannie Mae or Freddie Mac
  2. Your loan must have a note date no later than May 31, 2009
  3. Your home must have less than 20% equity
  4. You must be current on your mortgage, with a good 12-month payment history

In addition, you may not refinance a loan which is the result of a prior HARP refinance, unless the refinance occurred between March and May, 2009.

HARP lenders will typically verify income, assets and employment as part of the refinance. However, not all lenders will. In addition, some lenders will enforce minimum credit scores of 600 and others will require FICO scores of 640, at least.

Among the nation’s lenders, there is a lot of variance in the qualification standards for HARP. Therefore, if your HARP loan application is turned down at first request, consider applying with a different bank — you may not get the same result.

HARP expires December 31, 2015. There will be no HARP loans made after this date.  

Check Today’s HARP Mortgage Rates

With today’s mortgage rates near 12-month lows, HARP refinances represent an excellent opportunity for homeowners to reduce monthly payments and save money on a mortgage.

Compare today’s live mortgage rates and see how much money you can save via HARP. Rates are available online at no cost, with no obligation to proceed, and with no social security number required to get started.

Click here to get today's HARP rates (Feb 24th, 2020).