Flexible
HARP loans allow you to refinance even if you owe more than your home is worth, often without the expense or hassle of an appraisal
Less Red Tape
With no FICO score requirements and far fewer restrictions overall regarding credit, HARP loans are much more likely to get approved
More Savings
When less restrictions combine with more flexibility, you get more savings
The Facts
Who's Eligible
The first requirement you'll want to check off the list is that your loan must be owned by Fannie Mae or Freddie Mac. In addition, your loan must have been closed prior to June 1, 2009. If you follow the links given they will help you get the answers to both questions.
Equity
It is a common misconception that you have to be underwater in your mortgage to qualify for HARP. While it was initiated to help homeowners who had lost equity due to the mortgage meltdown, negative equity has never been a requirement.
Mortgage History
Although there is no minimum FICO score to qualify for HARP and other guidelines are more lenient, there are still some automatic exclusions. These include your loan being delinquent, or having been 60 or more days late in the last 12 months.
Public Records
Unlike standard conventional loans, HARP loans have no set requirements for bankruptcies or foreclosures. Approvals can be issued with bankruptcies and foreclosures filed as recent as one day prior to application.
Income Requirements
You are able to have much higher debt to income ratios with this special program. In some cases, DTI requirements are removed completely.
HARP vs HAMP
HARP and HAMP often get thrown around as if they are one in the same program. HARP stands for Home Affordable Refinance Program, and HAMP stands for Home Affordable Modification Program. HARP refinances and pays off your current loan, giving you a brand new loan. HAMP modifies your current loan, changing its terms and conditions either temporarily or permanently. Modifications can be very beneficial, but because they are almost always temporary amendments, over time the mortgage's terms often end up back to where they started initially.