Survive Your Underwater Mortgage
You’ve been told by your lender that a 6.75 percent home loan is the best value you’ll see in the industry, but that was several years ago. If you still have that loan, but are struggling to find the monthly funds to pay it, there is relief in the form of The Home Affordable Refinance Program.
Calculate Your Possible Savings
The Home Affordable Refinance Program, HARP is meant to help homeowners owing more money on their loan than the property’s overall value. If your lender told you they could lower the interest rate by 3 percent to drop $250 off each payment, you’d jump at the chance. HARP has the ability to give you just that benefit. Dropping the interest rate from 6.5 to 3.5 percent is a substantial savings for you. If you take that savings and apply it to the life of the loan, you’ll see that $150,000 is shaved right off the total payment amounts. Because home loans are often around 30 years, that interest accrues into huge numbers. Those savings translates into shorter term lengths and nearly $200 to $300 off each mortgage payment. That extra money should be put to good use, such as a savings or retirement account.
What’s the Catch?
With all these benefits, it’s natural to be wary of such programs. However, HARP is backed by the federal government. It wants Americans to keep their homes and prosper. The HARP Program isn’t a permanent fixture so it’s critical to start your application process immediately. It’s set to expire in 2015. Because you want time to find the right lender and fund the loan, several months of commitment must occur to get the loan signed. Once you refinance under HARP, you keep the loan for the length of its term. It cannot be revoked.
The middle class often pay dearly for their daily needs, from high interest rates to income taxes. Because this economic class doesn’t have a lot of disposable income, earning cash through the stock market and other outlets is just not possible. However, a struggling middle class effects the entire national economy. The federal government recognizes this, but lenders are wary about losing high interest payments or a possible account through HARP. If you have a loan-to-value ratio of 80 to 125 percent and the loan is less than $625,000, a HARP loan is perfect for your situation.
As of the second quarter of 2014, according to Fannie Mae and Freddie Mac’s Data recording there are a total of 54,041 loans representing 16% of HARP Refis.
How Can I Get A Quote?
Drop up to $4,900 a year off your mortgage payments by refinancing today. Contact a favorite lender or shop online for a new outlet. There are answers for your mortgage needs. HARP is meant to help homeowners and the overall economy. Simply compare quotes to decide on the best deal for you. Look for your HARP loan with almost any lender. Because you’re shopping around, lenders should offer you their best price to win your business. HARP allows the homeowner to take charge of their finances and speak confidently with bank officials. With the government’s help, you are not alone finding that perfect loan amount.
Jessica Lucas
