Refinancing used to be a breeze. People would go to their lender and refinance their homes to get better terms. Then, they would make lower payments or get the benefit of lower interest rates.
Life was easy.
Then, the housing bubble finally burst in 2006, and that created a widespread problem. Home values dropped overnight, and that caused people to lose a lot of the equity they had built into their homes. At the same time, interest rates were going up and people needed to refinance.
They went to their lenders, only to be turned away. They didn’t have enough equity to refinance, so they had to live with their unfavorable terms.
That has changed, thanks to the Home Affordable Refinance Program (HARP). The HARP program has opened up the door for people to refinance, even if they have been turned down for traditional loans. Backed by the federal government, it is much easier to qualify for this loan.
If your loan-to-value ratio is higher than 80 percent and you want to refinance, HARP might be the answer. You won’t need to get personal mortgage insurance or pay a lot of money upfront. That makes this the perfect solution for borrowers in California and beyond.
HARP Loan Requirements
Not everyone qualifies for a HARP loan. The federal government has put some requirements in place. If you meet these HARP loan requirements, POP Mortgage can help you secure financing for your California home.
To qualify for a HARP loan, you need:
- A mortgage that was guaranteed by Fannie Mae or Freddie Mac on or before May 31, 2009
- A loan-to-value ratio greater than 80 percent
- A history of current payments
You do have some leeway in regards to being current on your mortgage payments. While you won’t be accepted if you’ve had any 30-day late payments in the previous six months, you can have one in the last 12 months. If you’ve had a late payment in the last year but you’re current now, don’t be afraid to apply.