Harp Loans: What Is It and Who Can Choose It

May 24, 2022

Have you ever wished for a loan that would let you get out of debt, lower your monthly payments, and save money? Well, Harp is the answer to your prayers. The government created the HARP program in 2009 to help homeowners struggling to make their monthly mortgage payments due to the decrease in the value of their homes.

This article gives you an overview of HARP loans and tells you about the eligibility requirements to help you make the right decision.

What Is a HARP Loan?

If you're underwater on your mortgage, you can avail this loan. It's a government-backed mortgage that helps people refinance their current mortgage at today's lower interest rates.

If you have an FHA loan or a VA mortgage, or if your loan is backed by Fannie Mae or Freddie Mac (which includes many loans from banks), then HARP could be an option for you.

What Are the Benefits?

HARP loans are designed to help homeowners at risk of foreclosure or short sale by offering them better mortgage rates and lower payments. They also allow homeowners with high-interest rates to refinance into a new loan at a lower rate while keeping the same property. This can be beneficial in many ways:

  • It allows people who cannot afford the total amount of their mortgages to become current on their payments.
  • It helps others avoid defaulting on their mortgages.
  • It will probably save households thousands of dollars over time.

Who Qualifies for HARP?

To be eligible for this loan, you must:

  • Be current on your mortgage – meaning that you have made all payments on time and are not more than one month behind in payments.
  • Have a mortgage owned or guaranteed by either Freddie Mac or Fannie Mae – if you're unsure of this, you can check with your lender.
  • Have a loan origination date before May 31, 2009
  • Not have refinanced your first-lien mortgage through HARP previously. It's okay if you had a Fannie Mae loan refinanced under HARP in March-May 2009.
  • You have an LTV ratio of more than 80%.

How Can You Choose The Right HARP Loan?

Consider the following key factors:

Work With an Experienced HARP Lender

Many lenders claim to offer this loan, but not all have the experience and knowledge necessary to provide you with the best possible loan. Working with an experienced HARP lender will ensure that you get the best possible loan for your situation.

Understand All the Terms and Conditions

There are many different types of loans available, and each one has its own set of terms and conditions. You must understand all of the terms and conditions before agreeing to them. Otherwise, you may find yourself in a worse position than when you started.

Compare Several Loans before Choosing One

Many different lenders offer these loans, so you must compare several of them before choosing one. This will help you get the best possible deal on your loan.

The Bottom Line 

A HARP loan can help you save money, get out of debt, avoid foreclosure and bankruptcy, and take control of your finances. It provides you with a way to pay off high-interest debts that eat away at your budget. Talk to your lender to understand all the T&Cs.


Carlos Diaz
I believe in making the impossible possible because there’s no fun in giving up. Travel, design, fashion and current trends in the field of industrial construction are topics that I enjoy writing about.

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