Total loan refinancing completed through Fannie Mae and Freddie Mac (the GSEs) during second quarter reached over 344,000. The Federal Housing Finance Agency (FHFA) stated that Fannie Mae refinancing had for 211,825 while obtained Freddie Mac 132,688 of the total transactions.
And with updated guidelines for HARP 3.0 just on the horizon, millions of homeowners are speculating whether or not the updated HARP will pass in congress. In the same way HAMP or Home Affordable Modification Program by the government has made the headlines with the news that this government’s program will be extended until 2015, the similarly well-known HARP or Home Affordable Refinance Program has been specifically involved for capturing improvements that could make more under the water homeowners entitled to remortgage their home loans without the need to sign up for high priced private mortgage insurance.
HARP loan was first implemented in 2009 and it is already in its subsequent version, the HARP 2.0. This second iteration has already helped more than a million of underwater homeowners who found it too hard for them to meet their mortgage payments particularly when housing prices significantly increased in the past years. And as experts make a forecast about HARP getting a HAMP like extension through 2015, the newly proposed legal guidelines labeled Home Owner Refinancing Act of 2013 or HARP 3.0 will definitely expand the refinancing program and allow a great number of homeowners access to it.
Proposed Updated Guidelines For HARP 3.0
First of all, the updated guidelines and eligibility for HARP 3.0 will enable all and sub prime mortgages to qualify for the program. Although majority of mortgages are usually guaranteed by the government through Freddie Mac or Fannie Mae programs, there were many mortgages a few years ago that were established via non government financial institutions majority of whom provided affordable and lower rates that were more attractive than mortgages underwritten by the government. If HARP 3.0 will pass, this means that even those with private mortgages can now be eligible for prime mortgages picked for sub prime financing to take advantage with a much lower rate. The new update for HARP loan will also enable homeowners with private financing to apply for assistance under the new program.
In addition, the updated HARP loan guidelines will also allow for multiple HARP refinancing. In the last few years during the time when mortgage rates were dropping, homeowners who did not avail HARP have the capacity to refinance their mortgages more than once just so for them to be able to avail lower rates. Those under the HARP program were not able to refinance their mortgages thus missing the opportunity for lower rates. But under this new updated guideline, homeowners who availed HARP can qualify for refinancing once they completed six payments to their financer.
The updated guidelines for HARP loan will definitely benefit a lot of homeowners having problems with their current mortgages. The only question left now is will this updated HARP guidelines pass?