HARP Refi Program: Rates, Roofs, and 2nd Mortgages

by Margaret from Sarasota, Florida and by Kathleen from Florida

Ask Kate about the HARP refi program - rates, roofs, and 2nd mortgages: Margaret thinks she understands HARP refinance guidelines but wants the straight scoop from me! Kathleen was inundated with offers for HARP yet was told because her home is situated on leased land, she isn't eligible! So she asks how to get her hands on a copy of HARP guidelines to determine if she's being told the truth.


Ask Kate: HARP Refinance, Home Improvements, 2nd Mortgages, Loan Terms

By Margaret A. from Sarasota, FL
HARP Refinance, Home Improvements, 2nd Mortgages, Loan Terms

Kate,

I think I know the answers to my questions but would like to hear them from you!

1. Can the cost of a new roof be included in a HARP refinance?

2. Can you pay off a 2nd mortgage by rolling it into a HARP loan?

3. Can you do only a 15 year HARP or also a 20 year and 30 year term?

Ask Kate at Get-Your-Best-Mortgage-Rate.com
Kate's Answer: HARP Refinance, Home Improvements, 2nd Mortgages, Loan Terms

Hi Margaret,

It's good to get a reading on loan guidelines from an independent source.

That's what my website is all about! Thanks for asking your questions.

Margaret's Question: Can the cost of a new roof be included in a HARP refinance?

Kate's Answer: Neither the original version of the Home Affordable Refinance Program (HARP) nor the 2012 revised version (HARP 2.0) allow home improvements or consumer debts to be rolled into the new loan amount. Only the current mortgage balance plus closing costs can be included in a HARP refi.

In other words, HARP is a no-cash-out (aka rate and term) refinance program. Educate yourself on HARP closing costs before you begin the refi loan process.

Margaret's Question: Can you pay off a 2nd mortgage by rolling it into a HARP loan?

Kate's Answer: No 2nd mortgages are allowed to be paid off in the HARP refinance.
See Ask Kate: HARP 2 Refinances and 2nd Mortgages for answers to these questions... Do you know about refinancing with HARP if you have a 2nd mortgage? Can you roll the two together into one loan? What does subordination mean? Why wouldn't a 2nd mortgage lender cooperate with the HARP refinance?.
Speaking of cooperation, homeowners with 2nd mortgages should know that their HARP refinance process will require an extra step, one with the potential for pitfalls.
See Ask Kate: HARP Refinance Made Impossible for my answers to Joe's questions... I need to get a letter of subordination. What can I do to move things along? How does the new administration expect people to take advantage of these new programs if the banks are conducting business this way.

Margaret's Question: Can you do only a 15 year HARP or also a 20 year and 30 year term?

Kate's Answer: Underwater homeowners who hope for a 15 or 20 year term will be happy to know that one HARP eligibility requirement concerns reducing the length of the loan. However, this does not preclude opting for a 30 year fixed. Even so, there may be bigger fish to fry!
See Ask Kate: HARP 2 Refinancing and Interest Rates for my answers to Redline's questions... What I find most disturbing is that they are offering me the same rate whether I go with 30yr fixed or 20yr fixed and told me that 15yr fixed is not even an option with HARP2.

HARP 2.0 Eligibility Requirements, Guidelines, and Expiration Dates

There's seemingly no end to restrictions in the Making Home Affordable Refinance Program. So I created an easy-to-read overview of eligibility requirements and common guidelines to cut through the confusion, including program expiration updates.
Be sure to check it out at New HARP 2.0 Loan Announcement
Best wishes,

Ask Kate

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HARP Guidelines for Leased Land
by: Kathleen from Florida

We have been inundated with offers for HARP because our current interest rate is high. So we called our bank with whom we already have a mortgage. Excellent credit etc. We gave all our information which they already have.

Received a call back, cannot have a HARP loan because are on leased land, government owned. We have paid taxes for 10 years and lease fee. House value is $484,000.

What I want to know is it possible to get a copy of HARP Loan form? It doesn't feel right for lenders to have it and not us.

Hi Kathleen, Kate here...

I could not agree more. Knowing is power!

If you want to wade through the myriad of guidlelines, do a search for Fannie Mae (or Freddie Mac) HARP Guidelines. Make sure you are getting on the actual Fannie and Freddie sites. The guidelines are generally in PDF form.

You'll also find unique answers by Ask Kate at Home Mortgage Tips designed to help borrowers survive the loan approval process!

Best wishes, Kate

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