Central Ohio banks are practically begging customers to refinance their homes through a federal program designed to help those whose homes have declined in value, save money.
Many home values are still recovering from the recession, with homeowners often owing more than their house is currently worth.
That makes those people the perfect candidates for the government's Home Affordable Refinance Program, or HARP.
"A lot of folks still have some property value problems," said Jay Plum, the Executive Vice President of Huntington National Bank. "So this program doesn't really involve what the value of your home is now or what the appraised value is. It really is about helping you get a lower rate at today's market rates regardless of the loan-to-value on the property. So it's very attractive.”
Some banks are having a difficult time getting customers to take advantage of the program.
"I think folks are still a little skeptical, particularly if they have a property value problem," said Plum. "So, if property values in your neighborhood went down, it's hard to think that you can take advantage of these refinance opportunities. But this program is specifically designed for that."
To qualify, you must meet all of the following criteria:
• 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.
Those who want more information should ask their bankers.
It's worth it, because you could end up saving several thousand dollars a year by qualifying for HARP, Plum said.
"Rates have gone up a little bit but they're still pretty darned low. And if you're saving $200 a month, $250 a month, just from refinancing your loan, it really is like found money," added Plum.
According to Plum, your out-of-pocket expenses are estimated to be between $1,000 and $2,000.
He says the HARP program runs through 2015.
If you're interested, Plum suggests you start with your own mortgage company.
But he says you don't have to use them.
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