There was a lot of excitement about HARP, the Home Affordable Refinance Program, when it was first launched back in March of 2009. It was created to assist the nearly 5 million borrowers with upside down mortgages to refinance into a fixed rate loan and a reduced monthly payment. Unfortunately, the program didn’t really live up to all the hype because of all the fine print and various hoops that were necessary to jump through in order to qualify for the program. For example, a homeowner would have to be able to show a loan-to-value ratio of between 80% and 125% in order to be eligible. But in many markets, like Sacramento, homes lost as much as 50% of their value making it impossible to qualify. As a result, less a million borrowers nationwide were able to refinance through HARP.

The new and improved HARP program, known as HARP 2.0, took effect on December 1st, 2011 and starting in 2012 became available to borrowers with an LTV of more than 125%. This is a major game changer for homeowners with underwater mortgages, especially in Sacramento and the Central Valley region.

There are other changes to HARP that make this upgrade a winner:

• Most homeowners will no longer need to have an appraisal done in order to get their loan underwritten, which will really streamline and smooth out the process.


• Some of the fees that were attached to risk on shorter term loans have been modified or eliminated.


• The expiration date to receive HARP refinancing has been pushed back all the way to December 31, 2013.

One requirement that hasn’t changed is that your mortgage must be held by either Fannie Mae or Freddie Mac, which most are, but if you’re not sure just call us at Granite Equity Group (916-560-3731) and we can help you find out. We can also help you to find out if you meet the other eligibility requirements.

We’re very excited about the new HARP 2.0, and if you’re a homeowner looking to get out from underneath of your upside down mortgage you should be too. We believe that this new and improved HARP could give a lot of frustrated borrowers the break they've been waiting for. Click here for more details on HARP 2.0