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Do I qualify for HARP 2 with a 40 year term or ARM?

If you have a 40 year or an Adjustable Rate Mortgage (ARM) you can qualify for the HARP program. Unfortunately, you won’t be able to access all the benefits of the updated HARP. Below are some of the restrictions still in place for 40 year loans and ARM’s

The Restrictions Applied to 40 Year Terms and ARM Loans Under HARP 2.0.

The biggest restriction still in place for 40 years and ARM’s is the Loan-to-Value Cap (LTV). Loan to value is a ratio of the amount you owe and the value of the home. HARP was designed for those who owe more than there house is worth (LTV of more than 100%). The LTV cap for 40 years and ARM’s is set at 105%.

When you refinance with HARP, it is important and necessary that you obtain a new rate term. You will not be able to refinance into an ARM or 40 year. Your options will be a 30, 25, 20, 15, or 10 year loan term. That is why we recommend that when you refinance, you move to a 15 or 30 year fixed rate loan. It is beneficial to move to a more stable product and lock in a fixed interest rate. This is a critical step since interest rates are there lowest in 60 years, and will only go up from here.

*note currently only 30, 25, and 20 year terms are available with the updated HARP. The 15 and 10 year terms will be available sometime in June of this year.

Did we mention HARP 2.0 is live now?

If you are looking to refinance, meet all the requirements, and want to start saving money today, than it’s time to apply for HARP! HARP won’t be available forever. In fact, HARP ends Dec, 31st, 2013, which is a very small window of opportunity to refinance with all these benefits so take a deep breath and dive into the savings with MCity.

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MCity Mortgage, Inc.
     |     35 West Pine Street, Suite 211     |     Orlando, FL 32801     |     (407) 237-3131     |     Penelope@MCity.pro
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