As the federal government contemplates increasing
home-financing rates, now is the best time to refinance your home. There's a
program the government created in the past few years called the Home
Affordability Refinance Plan, commonly referred to as HARP, which enables
Americans to save big on refinancing. It provides you the opportunity to
refinance at surprisingly low rates, which could reduce your monthly payments.
The average reduction was a savings of about 33% last year. On a $200,000 loan,
that translates to an average savings of $4,100 in the first year. And with the
low rates, 39% of homeowners were actually able to shorten their loan terms as
well.
Homeowners are becoming increasingly savvy, and many are
surprised to learn how much they're able to save on their mortgage while
refinancing. The program started in March of 2009, but is set to expire at the
end of December 2015, so it's vital to act fast.
A Stimulus Plan for American Homeowners
The program benefits the average American homeowners whose
mortgage payments are current. The government wants lower rates to keep more
Americans from foreclosing, which aids in the long-term economic recovery. The
banks however, are less than pleased because HARP allows for 3 keys to keeping
rates low:- You can shop around for multiple lenders, so you're not limited by your current lender's rates
- Your home's loan-to-value is unlimited, so you don't have to worry about the value of your home, compared to the remaining mortgage amount
- Homeowners are not required to carry private mortgage insurance.
Thus, refinancing has become increasingly less expensive,
and you're able to refinance your loan, no matter how much the value of your
home has dropped or increased. Banks want to keep you at the higher rate,
that's one of the reasons why the program comes with an expiration date, and
that's why it's so important to move quickly.
The average monthly savings is nearly $350. Just think what
you could do with the extra money every month. Plus, with the potential ability
to shorten your loan terms, the HARP program really is saving money.
Please reach out to me if you need help with this process. volkan.andic@everyhome.com
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