Launched by the Federal Housing Finance Agency or FHA in the United States in the year 2009, the HARP – Home Affordable Refinance Program – is a home loan initiative targeted specifically at homeowners who have negative equity and are looking for options to refinance their mortgages. That is, for those people who own property and are continuing to pay the regular mortgage and the property has a value below the outstanding balance on the mortgage that was used to purchase it. In other words, the current market value of the property is an amount lesser than the balance on the outstanding mortgage, or more simply put, an own home with little or no equity in it.

While banks require a loan-to-value ratio of 80% or less to qualify properties for refinancing without private mortgage insurance, the HARP allowed those homes with a loan-to-value ratio exceeding 80% for refinancing, with the same condition on private mortgage insurance as banks. From an initial 105%, after increasing it to 125%, now the HARP 2.0 program extended the offer to those over 125% and to those with or without a private mortgage insurance. The concept of guaranteeing mortgage lenders that they would not be penalized for home loan frauds on the original loan amount greatly enthused more participants into this program.

There are certain basic criteria that need to be met that decides whether homeowners are eligible for HARP or not. Some of them are:

• Freddie Mac or Fannie Mae must own or guarantee the home mortgage;
• home mortgage payments must be up-to-date on this property that is your primary or secondary residence or an investment property;
• the current loan-to-value ratio is greater than 80% and
• the mortgage must have commenced on or before May 31, 2009.

However, though this is not an exhaustive list of eligibility requirements for HARP. Expected to be brought to a close in December 2016, the HARP now has a new deadline of December 2018. What are you waiting for? Find a better home loan equipped with the details of HARP.