The Home Affordable Refinance Program, or “HARP” for short, is a program set up by the United States federal government (specifically the Federal Housing Finance Agency) back in 2009 to help homeowners with negative equity or “underwater” homes refinance their properties.
If you are a citizen of San Diego, California, and you have heard about the San Diego HARP program but don’t really know too much about it or how it works, continue reading this blog post to find out more!
Why is the San Diego HARP program needed?
The federal HARP program was created in 2009 for people whose homes have been severely devalued following the burst of the housing bubble back in 2006. Part of the reason for the housing bubble burst is because of the excess amount of homes available to buy.
One can consider the laws of supply and demand in such a case; in other words, because there was an abundance of homes on the housing market, property values plummeted, but if there is a shortage of homes to buy then the value of those homes would obviously rise.
Who can the San Diego HARP program help?
Back in 2009 when this federal program was established, it allowed people that had a loan-to-value ratio exceeding 80% to refinance their homes without having to also pay for mortgage insurance.
Later on that year, the program was extended to those with a loan-to-value ratio of 125%. And then in 2011, “HARP 2.0” was introduced. The major benefit of this revised HARP program was that there was no loan-to-value limit; in other words, people with mortgages that had a loan-to-value greater than 125% could, for the first time, take advantage of this program.
There are certain conditions that must be met before one can definitely take advantage of this program. If you are not sure that you are understanding San Diego HARP program fully, continue reading to learn more about what is required and how it can help your individual situation.
What are the requirements for the San Diego HARP program?
In order to qualify for the San Diego HARP program, you will need to satisfy the following criteria:
- Your mortgage needs to have been taken out with or guaranteed by Freddie Mac or Fannie Mae;
- Your mortgage has to have been taken out on May 31, 2009, or any date before then;
- You must not have refinanced your home using the San Diego HARP program;
- You must be up-to-date with your mortgage payments, and have had no late payments within the last 6 months;
- You must not have made any late payments within the last 12 months;
- Your current loan-to-value ratio must exceed 80%;
- There has to be proof that you will benefit from the San Diego HARP program, such as having lower monthly mortgage payments.
How can the San Diego HARP program help me?
The most important thing to bear in mind is that the San Diego HARP program is designed to eliminate the negative equity in your home. You will also benefit from reduced mortgage payments, lower fees and interest rate costs, and, of course, less stress and anxiety!