Advantages of a HARP Refinance
Some of the great features of this type of refinance transaction are:
- Generally lower closing costs
- Generally more lenient underwriting
- Sometimes no appraisal is required
- The same low rates that conventional loans qualifying for a conventional refinance transaction would get. This includes adjustments for credit score, type of property, etc.)
- If your loan is owned by Freddie Mac, you may not be required to prove income. NOTE: If your loan is owned by Freddie, you will have to do your refinance through your current loan servicer. However, Fannie loans can be done by any lender offering this program.
- NO MORTGAGE INSURANCE (even if you owe more than the house is worth)
- With a Fannie loan, all your closing costs can be included in the mortgage, so, except for a credit report fee and appraisal fee (if required), this loan does not require cash up front.
Remember, the goal of this loan is to reduce your current payments. There is a maximum of $250 Cash out allowed.
It is still possible that current loans with mortgage insurance, and/or loans for up to 125% of the current valuation may become eligible for HARP financing soon, so please keep checking back. I will definitely make that announcement as soon as I hear more.