President Barack Obama recently announced a plan to redesign and expand the current HARP program. Initially passed in 2009, the Housing Affordable Refinance Plan was implemented to allow borrowers whose loans were backed by Fannie Mae and Freddie Mac a chance to refinance more comfortably, often without having to pay down their mortgage.

During its infancy, the program was aimed to get borrowers into more “short-term” loans, and was limited to borrowers who owed between 80%-105% of the value of their home. Shortly after, the cap was raised to 125%. Under the new plan, borrowers can refinance at a lower rate, with no loan-to-value cap starting in the first quarter of 2012, and also without having to obtain mortgage insurance or an appraisal. To be qualified, borrowers must be current on their mortgage payments, have current, verifiable income, and prove that they are a good credit risk for refinance.

The program is appealing for those home owners who are looking to refinance. Only 9,000 borrowers have taken advantage of the government’s offer since the program began over two years ago.

Originally from Condo.com – Condo News