Understanding HARP: Pros and Cons of the Home Affordable Refinance Program

Understanding HARP: Pros and Cons of the Home Affordable Refinance Program


HARP stands for Home Affordable Refinance Program, which is a federal program designed to help homeowners who are underwater on their mortgage or have low equity in their home to refinance their mortgage at a lower interest rate and more favorable terms.

Here are some of the pros and cons of using HARP:


  1. Lower monthly payments: HARP can help lower your monthly mortgage payments by allowing you to refinance at a lower interest rate, which can save you thousands of dollars over the life of your loan.
  2. No appraisal or underwriting: HARP generally doesn’t require a new appraisal or extensive underwriting, which can save you time and money.
  3. Streamlined process: The HARP process is generally faster and more streamlined than traditional refinancing, which can help you lock in a lower interest rate sooner.


  1. Limited eligibility: HARP is only available to homeowners who have a Fannie Mae or Freddie Mac mortgage that was originated before May 31, 2009, and who meet other specific criteria.
  2. No cash-out refinancing: HARP only allows for “rate and term” refinancing, which means you can’t use it to take cash out of your home’s equity.
  3. Fees and costs: While HARP can save you money in the long run, there are still closing costs and other fees associated with refinancing that you’ll need to pay upfront.

It’s important to weigh the pros and cons of using HARP and consult with a mortgage professional to determine if it’s the right option for you.

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