700,000 Homeowners Could Still Benefit From U.S. HARP Refinancing

Although the housing market is on the mend, recent reports estimate that at least 700,000 eligible home-owners are on the verge of missing out on this middleclass bail-out when it expires later this year. In fact, one recent study indicates 53% of qualified homeowners have yet to refinance through this program even though it could save them thousands. Are you one of them?

The program is called HARP, ("Home Affordable Refinance Program) and this is the program your current lender doesn't want you knowing about it. Why? Because if word gets out it could cost them millions in lost interest when their borrowers switch to other banks. Think about it why would you keep paying the 4, 5 or even 6% (!) APR you originated your loan at to your current lender if you qualify to refinance and save hundreds/ month in interest at today's low rates? You wouldn't that's why they're not telling you about it.

Fortunately, the government is hoping to push as many refis through before the clock expires this year and yours could be one of them.

HARP helps homeowners get a better, more affordable mortgage. If you qualify and refinance through HARP, you may be able to take advantage of a number of significant benefits, such as eliminating up to 15 years of mortgage payments (and a LOT of interest), changing to a lower monthly payment, or refinancing at historically low rates. As it is a government program, HARP is totally free and doesn't add any cost to be matched with lenders.

But how much money are we talking?

A lot. For example, Refinancing a $200,000, 30 year mortgage at 6.5% to a 15 year term at 3.2%, you would save $142,325 in interest over the life of the loan that's like saving almost $800/month for the next 15 years. In fact, even if you don't shorten the term of your loan and just refinance into a lower rate - the average refinance saves $3,000/ year. That's real, take-home money and you better believe that makes a difference!

While HARP is set to expire this year unless Congress steps in (unlikely), the good news is interest rates are at 3 year lows, so there really has never been a better time to refi and lock in and lower your monthly payment. It's not too late!

But, I heard it's hard to qualify?

If you were told no in the past, consider reaching out to see if you might qualify now.

It used to be but not anymore. Now with recent changes to the program, refinancing has never been easier. The latest version streamlines the process by doing away with a lot of the red-tape and paperwork that made it difficult for homeowners to refinance when the program started meaning if you were denied before, there's a good chance you qualify now. Most importantly:

  1. HARP has done away with the Loan-to-value rule on a fixed rate mortgage, meaning, even if you're underwater, no matter how far, you may still qualify for a HARP loan.
  2. Waives the requirement of having a Credit Score check run, meaning regardless of what your current credit score is, you may qualify to refinance through these government backed loans

And while HARP is very popular right now, it is just one option available (others are FHA, 15 yr, 30 yr, fixed rates, ARMs, etc.) and may be even better options or fits depending on your current mortgage situation. Unfortunately, time is working against you as today's low rates are predicted to rise and HARP set to expire.

The Shocking Amount You Could Save With HARP If You Qualify

Here's an example of how much you could save if you switched from a 6.25% mortgage into a 3.25% mortgage:

So, how do I get started?

There are hundreds of lenders out there, and it's a daunting task to figure out who is giving you the best deal. That's where online services like Lower My Bills can help. You fill out a simple 3 minute form, which and they search their network of lenders to find the best matches for you.

Most of the lenders on their network allow qualified homeowners to use HARP: they know this program helps them give you a great deal, and they know they have to give you a great deal if you're going to make the switch. There's absolutely no cost to be matched with lenders, but there is a huge cost to stand by and not do anything. What are you waiting for? See if you qualify!