Categorized | Residential

Homeowners Set to Benefit from Updated HARP Program

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It looks as if the Home Affordable Refinance Program, better known as HARP, is finally being reworked so as to accomplish what it was intended to do in the first place. The original HARP program was initially established to help homeowners refinance their mortgages following the housing crash. However, restrictions included within the initial bill essentially eliminated the majority of those who served to benefit from the intended purpose of the program.

The new and improved HARP program should provide assistance to nearly two million borrowers by making it possible for them to refinance to the current record-low interest rates. The original HARP held similar expectations, but stringent restrictions disqualified many homeowners, leading to less than a million homeowners receiving the intended benefits.

One of the biggest issues with the original harp was that a cap was used to prevent HARP from refinancing any loans that were one hundred and twenty-five percent more than the actual value of the home. The new revamped HARP program is expected to reach more homeowners by doing away with the cap. As such, the majority of those homeowners targeted by HARP will have no issue qualifying for the assistance.

Fees associated with refinancing through the HARP program are also expected to be reduced, and will actually be eliminated if a shorter mortgage is taken.

While the new program is expected to benefit many homeowners, many critics believe that it still is not the perfect solution. Homeowners who have taken out a mortgage in the last twenty-four months do not qualify for HARP. Furthermore, there is no time frame for which banks must abide by the new HARP guidelines.

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About James Pattric

James writes for the Residential category (along with Josh Johnson) and also heads up the Resources category.

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