The Federal Housing Finance Agency (FHFA) announced great news for homeowners looking to refinance. The Home Affordable Refinance Program (HARP), scheduled to expire at the end of this year has been extended until September 30, 2017. According to the FHFA, there are more than 323,000 borrowers eligible for the program (over 12,000 in the State of California). The FHFA will also implement a new refinance offering for borrowers with high loan-to-value (LTV) ratios. These borrowers “have a remaining balance of $50,000 or more on their mortgage, have a remaining term on their loan of greater than 10 years, and their mortgage interest rate is at least 1.5 percent higher than current market rates.”
FHFA Director Melvin L. Watt stated in a press release, “This new offering will give borrowers the opportunity to refinance when rates are low, making their mortgages more affordable and thus reducing credit risk exposure for Fannie Mae and Freddie Mac.”
Borrowers must benefit from the refinance in at least one of the following ways:
- Reduced monthly principal and interest payment.
- Lower interest rate
- Shorter amortization term
- More stable mortgage product, such as moving from an adjustable-rate mortgage to fixed-rate mortgage
In order to qualify for the new offering, borrowers:
- Must not have missed any mortgage payments in the previous six months
- Must not have missed more than one payment in the previous 12 months
- Must have a source of income
- Must receive a benefit from the refinance such as a reduction in their monthly mortgage payment.
The complete requirements will be published in the next few months and is scheduled to be available for new loan applications in October 2017. It’s a ways away, but will definitely benefit anyone who is looking to save money on their home loan.
Don’t wait until it’s too late. Fill out the form below or call today for your opportunity to save!