Should I Refinance? Government Refinance Programs Available
By Karen Lawson
If your home is worth less than your mortgage balance, there are programs designed to help you gain the advantage of current refinance rates. Here are three examples:
FHA Streamline Refinance Program for Existing FHA Loans
This option can only be used by homeowners with existing FHA mortgages. The U.S. Department of Housing and Urban Development (HUD), which oversees FHA, streamline refinancing does not require a new appraisal, nor does it require verification of income or employment. Eligibility requirements include:
Access to Current Mortgage Rates with HARP
The federal government’s Home Affordable Refinance Program (HARP) offers an opportunity for homeowners to refinance underwater home loans. Eligibility requirements for HARP refinancing include:
Not all Fannie Mae and Freddie Mac approved lenders participate in HARP. If you’re interested in the HARP program, act quickly as it is set to expire December 31, 2013.
Eligible veterans and surviving spouses can use the U.S. Department of Veterans Affairs (VA) home loan guaranty program for refinancing VA or non-VA home loans. VA allows homeowners to refinance 100 percent of their home’s current value; this can include taking cash out. Or, if you already have a VA home loan, you can refinance it through the IRRRL (Interest Rate Reduction Loan) program even if your home’s value has dropped and your mortgage is underwater.
Current mortgage rates for these refinancing options can vary; shop and compare mortgage quotes for finding your best mortgage rate.