2008 saw one of the biggest housing crashes in the history of the United States of America. The housing crash, also known as the housing bubble, was so bad the United States allocated over $900 billion dollars in 2008 alone to special loans. Over half of the $900 billion dollars was given to Fannie Mae and Freddie Mac.
Because of the crash millions of home owners were now upside down on their home mortgage making them ineligible for a new home loan. To add to the damage many home owners had adjustable mortgage rates (ARMS) loans that were going to reset to a higher interest rate causing a payment to sometimes triple.
Many home owners were now unable to make their monthly mortgage payment or owed much more on their home loans than what their house was worth.
The Home Affordable Refinance Program (HARP) is a relief program for people who continued to make their payments even though their homes where under water. Because their homes were worth less than what they owed they often encountered difficulties with trying to refinance their loans. Typical loan standards would usually not allow a new home refinance unless the house was worth more than the amount of the loan being received.
The HARP program helps to enable a new home loan if the applicant owes more than what their house was worth. A few key guidelines include the loan be owned or guaranteed by Freddie Mac or Fannie May and sold on or before May 31, 2009. The home owner has must current on their payment and have a good payment history for the last 12 months.
This program will end December 31, 2016 so it is very important to speak with a mortgage lender to see if you may qualify for a new home loan before the deadline passes. By learning if you qualify you could be eligible to save thousands of dollars a year with a new home refinance.
It is also wise to compare rates from trusted lenders to find out the right loan program for you. These lenders can answer all of your questions as well as give you the options on all the loans you may qualify so that you can make an educated choice on the new home loan. Usually these lenders can give you a good idea of what loans you would qualify for without any obligations or hidden fees.