How Harp Loan Works

Your mortgage statements including information on a second mortgage if applicable.

How harp loan works. It is important to know that harp does not lend money but works with lenders to offer harp refinancing. Of course you can refinance using harp into a shorter term loan. Now that you know what a harp loan is and how it works you can work with your lender to determine if you can take advantage of everything harp offers. How does harp work.

Find a list of lenders who work with new programs at one of these pages. If you qualify for harp refinancing you may be able to save a significant amount of money by lowering your monthly payment reducing your interest rate switching from an adjustable rate mortgage to a fixed rate mortgage or shortening your mortgage term from 30 years to 15 or 20 years. Hamp works by encouraging participating mortgage servicers to modify mortgages so struggling homeowners can have lower monthly payments and avoid foreclosure. While the greatest cash flow improvements may come from a re lengthening of the term to a new 30 years fhfa encourages borrowers to swap to 15 or 20 year terms with lower risk based fees than those available on terms of 30 years.

A lower mortgage interest rate. Harp makes it possible to get the following four benefits. Unlike harp 1 0 the updated version of the program had no ltv ceiling for individuals with fixed rate mortgages. How does harp 2 0 work.

As such you should ensure that your lender offers harp refinancing. A lower monthly mortgage payment. Your income details paystub or income tax return. Harp was aimed at borrowers who had a loan to value ratio ltv of greater than 80.

Tell them you are interested in refinancing and you want to see if you qualify for. Prior to the harp loan program being established only mortgages with a loan to value ratio of 105 could qualify. This opens up the program to an entirely new and much larger pool of borrowers. A shorter loan length i e.

First unlike its predecessor harp 2 0 allows borrowers with mortgage insurance to qualify for a refi. 15 years instead of 30 years. The program includes incentives for homeowners servicers and investors to encourage. Typically these borrowers have trouble securing refinancing because of lack of equity in their homes thus.

It has specific eligibility requirements for homeowners and includes strict guidelines for servicers.