New program rules allow mortgages with lender-paid mortgage insurance to be included in program
I hate giving people bad news. I field a lot of questions from people desperate to qualify for help with their mortgage, and often I have to explain that for this reason or that, they don’t meet certain eligibility requirements for different housing assistance programs. The dejection in their voice is heartbreaking. It’s enough to make me keep a bottle of Jack Daniels in my desk drawer.
But happily, the government has rewritten one of their mortgage assistance programs, and taken out one requirement that has been the cause of a lot of heartbreak.
Under the Home Affordable Refinance Program, people can refinance their home even though they owe more on their mortgage than the home is worth, because the government gives incentive money to the lender to do the refinance. Without the incentive money, no lender in their right mind would take on collateral worth less than what they’re loaning out to refinance the collateral.
There are a few different eligibility criteria for this program, and until now, one requirement stated that any mortgage with lender-paid mortgage insurance would not qualify for HARP. Talk about a heartbreaker. Most people who get a mortgage that requires insurance aren’t given the choice of who pays it.
But that HARP requirement has been done away with. Hopefully this will keep me from going into that desk drawer so often.