Cliffco Mortgage Bankers knows owning a home isn’t easy. Most mortgages run for a 30-year term and, let’s face it, nobody knows what their circumstances will be that far down the road. There are a number of reasons why you might be falling behind on your loan. You might have a home that’s underwater or close to being underwater, which means the balance on your mortgage is below or almost below the value of your property. This may be because of circumstances beyond your control.
Homeowners with underwater mortgages can encounter difficulty refinancing their mortgages from Fannie Mae or Freddie Mac. In response to the 2008 financial crisis, officials created a way to give refinancing relief to home owners. It’s called Home Affordable Refinance Program or HARP loan.
Cliffco Mortgage Bankers Can Help You With Harp Loans
The HARP program is run by the Federal Housing Finance Agency (FHFA), which oversees Fannie Mae and Freddie Mac. The agency recently extended HARP through the end of 2018, according to HuffPost. Cliffco Mortgage Bankers can help you with the process. We want to give you the basics of HARP loans so you can decide if it’s right for you.
Qualifying for a HARP Loan
According to FHFA you may qualify for a HARP loan if you meet the following criteria:
- Your mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae.
- Your mortgage must have been originated on or before May 31, 2009.
- You are current on your mortgage payments, with no 30-day plus late payments in the last six months and no more than one late payment in the past 12 months.
- Your current loan-to-value (LTV) ratio must be greater than 80 percent.
Loan-to-value ratio is the number that describes the size of the loan in comparison to the value of the property, according to the Balance. It tells you how much of the property you own compared to how much you owe. So if you want to buy a home worth $100,000 and you have $20,000 for a down payment, you will need to borrow $80,000. That means your LTV ratio will be 80 percent because the dollar amount of the loan is 80 percent of the value of the house.
Benefits of HARP Loan From Cliffco Mortgage Bankers
According to Fannie Mae HARP homeowners can save an average of $250 a month. That gives you a cushion for your finances. HARP loans can also help you lower the rate of your loan, or shorten the term of your loan. This can often allow you to pay your loan off a lot faster without a major change in your monthly mortgage payment. You can also use a HARP loan to transfer from an adjustable rate loan to a fixed rate.
HARP Loans are a great way to get out of an underwater mortgage and get on the road to more financial flexibility. If you believe you may qualify for a HARP loan or if you’re interested in finding a loan to buy property of any type, Cliffco Mortgage Bankers can help. We’re committed to helping our clients find homes and be able to keep your property. Contact us today.