Pennsylvania: Obama HARP Refinance Program Rolls out Nov. 15

Under the revised version of HARP, effective November 15, 2011, borrowers will be able to refinance their mortgages regardless of how much their homes have fallen in value.

In order to be eligible for the HARP refinance program:

Your loan must be backed or owned by Fannie Mae or Freddie Mac
Your current mortgage must have been sold to Fannie Mae or Freddie Mac prior to June 1, 2009

If you meet these two main criteria, you may be HARP-eligible. If your mortgage is FHA or USDA mortgage, you are not HARP-eligible.

See if Fannie owns your mortgage See if Freddie owns your mortgage

Additional criteria:

You must be current on your mortgage.

Your mortgage loan must be paid on-time for the prior 6 months, and at least 11 of the most recent 12 months.

You may not have used the HARP program before; only one HARP refinance per mortgage is allowed.

The value of your home does not matter if the NEW loan is a fixed rate mortgage. There is no longer a maximum LTV limit.

If a borrower refinances under HARP and the NEW loan is an Adjustable Rate Mortgage (ARM), the LTV may not exceed 105%.

The current LTV ratio on the mortgage must be greater than 80%.

Borrowers will not need a new property appraisal if Fannie and Freddie have enough data in their system to estimate the value of the property. This not only speeds up the refinancing process but also eliminates the appraisal fee.

Certain fees associated with the risk of the loan will be reduced. Those fees will be eliminated for borrowers who refinance their mortgages into a shorter-term loan such as a 20-year mortgage or a 15-year mortgage.

The program has been extended through the end of 2013.

Those who bought a house as their primary residence but now hold the property as an investment will be able to refinance through HARP at an additional cost.

Mortgages that have lender-paid mortgage insurance (LPMI) cannot refinance through the program. Mortgages that have borrower-paid mortgage insurance (PMI) may refinance, but borrowers must keep the same level of mortgage insurance they had on the previous loan.

Borrowers with second mortgages will still need the approval from their second lenders to refinance through HARP. That has been one of the biggest obstacles to those who have tried to use the program in the past.