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When homeowners visit the Loanatik official website, many are shocked to discover a little-known US Government program called HARP (Home Affordable Refinance Plan).

It seems the government is eager to rescue homeowners who are facing foreclosure, or who are “under water” (living in homes which are worth less than what they owe.) Many homeowners can refinance no matter how far their home value has dropped.

HARP is aimed at letting homeowners prepay their current mortgage and refinance into a lower-rate loan. If a homeowner’s mortgage was purchased by Fannie Mae or Freddie Mac before a certain date and the owner is current on the mortgage, the borrower can apply for a new loan at the lower prevailing rate. The program was designed to help homeowners who were the worst hit by the collapse in home values save on their monthly mortgage payments and take advantage of low rates. The government stepped in with HARP, because banks typically won’t refinance underwater owners.

From a 2012 article in the Daily Beast by Matthew Zeitlin:

http://www.thedailybeast.com/articles/2012/10/04/ new-data-shows-harp-mortgage-refinance-programis-finally-working.html

Another component of the administration’s housing policy was HARP, the Home Affordable Refinance Program. HARP was aimed at letting homeowners who are underwater—living in homes that are less valuable than the outstanding mortgage—prepay their current mortgage and refinance into a lowerrate loan. If a homeowner’s mortgage was purchased by Fannie Mae or Freddie Mac before a certain date and the owner remained current on the mortgage, the idea was that the borrower could get a new loan at the lower prevailing rate. The program was designed to help homeowners who were the worst hit by the collapse in home values save on their monthly mortgage payments and take advantage of low rates.

A government program was necessary, because banks typically won’t refinance underwater owners. And as a result, the record-low mortgage rates weren’t trickling down to struggling homeowners.

And as a result, as mortgage rates have hit one record low after another, millions of homeowners have been forced to watch, longingly, from the sidelines. They haven’t had the option of refinancing because sliding home values pushed their mortgages underwater, meaning they owe more than their homes are worth. The banks would just not work with them.

Yet many of these borrowers are gainfully employed, have solid credit histories and have never missed a mortgage payment. And they want to stay in their homes — even if those homes are worth substantially less than they paid. These are the families that the government likes to call “responsible” homeowners. With mortgage rates now lowest since 2013, smart homeowners are taking advantage of HARP while they still can.

Federal Housing Financing Agency (FHFA) estimates as many as 17.5 million Americans qualify for this little-known government program, but many just don't know about it.  

There are a number of reasons for this. One, the government has done very little to promote it. Two, many homeowners think it's too good to be true. Three, most banks will never tell you about it, because they stand to lose millions in interest payments from you when you refinance at the lower rate!

From a 2012 NYT Article by Tara Siegel Bernard

http://www.nytimes.com/2012/05/26/your-money/ mortgages/harp-2-0-stirs-hope-and-frustration-forhomeowners.html?pagewanted=all&_r=0

As mortgage rates have hit one record low after another, millions of homeowners have been forced to watch, longingly, from the sidelines. They haven’t had the option of refinancing because sliding home values pushed their mortgages underwater, meaning they owe more than their homes are worth. The banks would just not work with them.

Yet many of these borrowers are gainfully employed, have solid credit histories and have never missed a mortgage payment. And they want to stay in their homes — even if those homes are worth substantially less than they paid. These are the families that President Obama and other political leaders like to call “responsible” homeowners.

HARP can help you switch to a new lender, one prepared to offer you today's low rates, and you could cut your mortgage payment by an average of $345 per month. In some cases, you can also cut your mortgage term to 15 years, saving LOTS of interest.

However, the program is scheduled to end December 2015, and there is no indication it will be renewed.

So what are your chances of refinancing your mortgage through the HARP program?

First, you need to meet some basic requirements: Your mortgage must have been owned or guaranteed by Fannie or Freddie, and it must have been sold to either one before May 31, 2009. You must also have less than 20 percent equity in your home (that is, a loan-to-value ratio above 80 percent). And you cannot have had any late payments in the last six months, and no more than one late payment in the last year. HARP is also generally a one-shot deal: this has to be your first HARP refinancing.

From a 2015 blog post by Timothy Kingcade http://timothykingcade.com/?p=3689

HARP can help you switch to a new lender, one prepared to offer you today’s low rates, and you could save big. HARP is a government program and is totally free, so you have nothing to lose.

More from the NYT Article

http://www.nytimes.com/2012/05/26/your-money/ mortgages/harp-2-0-stirs-hope-and-frustration-forhomeowners.html?pagewanted=all&_r=0

First, you need to meet some basic requirements: Your mortgage must have been owned or guaranteed by Fannie or Freddie, and it must have been sold to either one before May 31, 2009. You must also have less than 20 percent equity in your home (that is, a loan-to-value ratio above 80 percent). And you cannot have had any late payments in the last six months, and no more than one late payment in the last year. HARP is also generally a one-shot deal: this has to be your first HARP refinancing.

Shopping around for a HARP refinancing may be frustrating, however, particularly if you’re trying to compare prices among the big banks. That’s because many of them, including Bank of America, Chase and Citigroup, are providing HARP refinancing only for their own customers. Why? Experts say it is still riskier for the banks to take on new customers, particularly those who are far underwater.

More from the NYT Article

http://www.nytimes.com/2012/05/26/your-money/ mortgages/harp-2-0-stirs-hope-and-frustration-forhomeowners.html?pagewanted=all&_r=0

Shopping around for a HARP refinancing may be frustrating, however, particularly if you’re trying to compare prices among the big banks. That’s because many of them, including Bank of America, Chase and Citigroup, are providing HARP refinancing only for their own customers. Why? Experts say it is still riskier for the banks to take on new customers, particularly those who are far underwater.