The Home Affordable Refinance Program
(HARP)

· Loan Eligibility;

o Existing loan must have been purchased by Fannie Mae or Freddie Mac prior to June 1, 2009.

o HARP loans are refinance loans with current LTV of 80% or greater.

o Loan application must be on or after December 1, 2011.

o Loans must close by December 31, 2013.

·         Maximum Loan to Value Ratios

o   No maximum for fixed rate mortgages with terms up to 30 years.

o   105% for fixed rate loans with terms greater than 30 years up to 40 years.

o   105% for ARMs with initial fixed –rate periods greater than or equal to five years and terms up to 40 years.

·         Credit Underwriting:

o   Bankruptcy and Foreclosures – no waiting period or requirement to re-establish credit.

o   No mortgage delinquencies in the last 6 months and no more than one 30-day delinquency in months 7-12.

o   If payment increases by more than 20%;

§  Minimum representative credit score of 620.

§  Maximum DTI ratio of 45%

§  Verification of all sources of income is required.

§  Verification of assets required to close, if applicable.

o   If payment is not increasing by more than 20%;

§  No minimum representative credit score.

§  No maximum DTI Ratio.

§  Verification of sources of income.

o   Loans originated by the current servicer can be manually underwritten.

o   Loans originated by a lender other than the current servicer must be submitted thru DU.

·         Property

o    No appraisal required on loans originated by the current servicer.

o   DU may grant a property waiver. If so no appraisal is required.

o   An appraisal is required if the originating lender is not the current servicer and DU did not issue a property waiver.

o   All property types and occupancy statuses are acceptable.

·         PMI:

o   If the current loan being refinanced has PMI coverage the new loan must have the PMI insurance transferred to it or a new insurance policy obtained.

o   If the current loan being refinanced does not have PMI coverage, coverage is not required regardless of the new LTV.

·         Fees:

o   If the term is greater than 20 years and the LTV is above 80%, FNMA LLPA are capped at .75%

o   If the term is 20 years or less and the LTV is greater than 80%, No LLPA will be assessed.

o   All normal lender fees apply.