The Home Affordable Refinance Program is a government program for assisting homeowners refinance their mortgages. HARP won’t lower your principal, but it might reduce your payments by giving you a better interest rate. In case you have an adjustable-rate mortgage, HARP may lower your current payments, however refinancing to a fixed speed can stop future increases you might not be able to afford. The program is set to expire on June 10, 2011.
Assess your eligibility for HARP. You may be entitled to the program, according to the Making Home Affordable website, if you own and reside in a one- to four-unit house; your mortgage has been possessed or guaranteed by the federally backed corporations Fannie Mae and Freddie Mac; you’re current on your mortgage payments; the amount you owe on your first mortgage does not exceed 125 percent of the present value of your home; and you are able to afford the payments if you refinance. Your lender may tell you if you have a Fannie Mae or Freddie Mac loan.
Apply to any Freddie Mac, or your lender or Fannie Mae approved lender, for a HARP refinance. The lender will supply you with an application form. You will need to show him with information about your monthly gross income; some other exemptions to the home; and accounts balances and minimum monthly payments on all credit cards, student loans, car loans and similar debts. You will require documentation–for example pay stubs and credit-card statements — this for all.
Pay the prices that are closing. If you qualify and the lender agrees to refinance, you will have to pay fees and the points as for any additional refinancing loan of the same size.