If you’ve been looking for a way to refinance your Atlanta real estate, help may be on the way. Today, the Federal Housing Finance Agency, Fannie Mae and Freddie Mac announced a series of changes to the Home Affordable Refinance Program. These enhancements are designed to attract more eligible borrowers who can benefit from refinancing their home mortgage.
HARP is unique because it is the only refinance program that allows borrowers to take advantage of low interest rates and other benefits even when they owe more than the value of their home. More specifically, the program applies to homeowners with loans sold to Fannie Mae or Freddie Mac on or before May 31, 2009 with a current loan-to-value (LTV) ratio above 80 percent.
According to a press release released by the Federal Housing Finance Agency, here is a list of changes to the Home Affordable Refinance Program:
- Eliminating certain risk-based fees for borrowers who refinance into shorter term mortgages
- Lowering fees for other borrowers
- Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac
- Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac
- Eliminating the need for new property appraisals where reliable automated valuation model (AVM) estimates from Fannie Mae and Freddie Mac exist
- Extending the end date for HARP to Dec. 31, 2013
While the aforementioned changes are certainly welcome improvements, not everyone is convinced that they will have a profound impact.
According to a statement released by NAHB Chairman Bob Nieslen, the changes to HARP will only affect a select group of homeowners.
“Making more borrowers eligible for refinancing their mortgages by enhancing the Home Affordable Refinance Program (HARP) will give a badly needed boost to consumer confidence. Enabling additional home owners to take advantage of today’s low mortgage interest rates in cases where their loans are greater than the value of their homes will give some households more money to spend on other things and enable others to at least pay their mortgages off at a faster rate.
“However, for the many families who have fallen behind in their payments because of the weak job market, the changes to HARP will have no benefit. HARP is only open to mortgage borrowers who have remained current with their payments. Clearly, additional policy initiatives are urgently needed to prevent foreclosures and deal with the inventory of foreclosed homes.”
To read the entire press release from the Federal Housing Finance Agency and for an overview of HARP, click here.
What do you think about the new changes to HARP? Will they have any effect on your current situation?