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HARP Program Continues to Reach Eligible Homeowners

By: | January 25th, 2013

The Home Affordable Refinance Program has no doubt been a success, especially in the past year. First introduced in 2009, the HARP program has been tweaked and changed in order to continue to reach more eligible homeowners.

According to CoreLogic, a data and analytics company, at the end of the third quarter 2012, 17.1 million borrowers had qualifying loan to values between 80 and 125% for the HARP program under the original requirements which were first introduced in March of 2009. With the removal of the 125% loan to value cap through HARP 2.0, the door to another 4.6 million borrowers was opened.

While negative equity continues to fall according to the CoreLogic data, more than a quarter of homeowners who have a mortgage remain in a negative equity position. The number of underwater homeowners fell by approximately 100,000 in the third quarter of 2012. At the end of the first three quarters of 2012, 10.7 million homeowners still remain with negative equity (22% of all mortgage holders).

While many of the these underwater borrowers have already used HARP to refinance, not all have done so yet. There is still time to obtain a HARP loan with low mortgage rates since the program runs until the end of 2013. For those who were denied or turned away, it is time to start looking for a lender who will work with you. Lender guidelines vary and what one lender denies, another lender will approve. Move on and keep searching until an approval is received.

Of these negative equity numbers, many of homeowners do not have loans that were sold to Fannie Mae or Freddie Mac, but are held by other investors. While there is legislation to expand HARP to all mortgage holders, this is still being considered, but has not yet been approved. Hopefully, at some time very soon, serious consideration will be given to this idea which will open the door for more underwater homeowners to refinance through the currently proposed HARP 3 program.

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