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Am I eligible for HARP 2.0 despite my recent bankruptcy?

By   |  Posted in Ask The Expert

Q: I filed bankruptcy one year ago in August. Does that mean that I won’t qualify for the harp 2.0?

A: From Fannie Mae, November 15, 2011:

“Removal of bankruptcy and foreclosure policy: Fannie Mae is removing the requirement that the borrower (on the new loan) meet the standard waiting period and re-establishment of credit criteria in the Selling Guide following a bankruptcy or foreclosure. The requirement that the original loan must have met the bankruptcy and foreclosure policies in effect at the time the loan was originated is also being removed.”

This indicates that you should be eligible. Freddie Mac usually follows the same policies as Fannie Mae, but there may be differences.

Your loan will also need to meet the rest of the HARP 2.0 specifications:

  • The mortgage must be owned or guaranteed by Freddie Mac or Fannie Mae
  • The mortgage must have been sold to Fannie Mae or Freddie Mac on or before May 31, 2009
  • The mortgage cannot have been refinanced under HARP previously unless it is a Fannie Mae loan that was refinanced under HARP from March-May, 2009
  • The current loan-to-value (LTV) ratio must be greater than 80 percent
  • The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months

Contact your servicer for more details; the number should be on your mortgage statement. For additional details about the government-sponsored programs to help you manage your home, visit http://www.makinghomeaffordable.gov.

About the author:

KTGA 25-year expert observer of the mortgage and consumer debt markets, Keith Gumbinger has been cited in thousands of articles covering a wide range of consumer finance and economic topics in outlets ranging from the Wall Street Journal to the Bottom Line newsletters. He has been a featured guest on national broadcasts for CNN, CNBC, ABC, CBS and NBC television networks and has been heard on NPR and other national and local radio programs. Keith is the primary researcher and writer for HSH.com's MarketTrends newsletter and has authored or co-authored a number of consumer guides on mortgages, home equity, refinancing and more.

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