Tuesday, July 31, 2012


When mortgage assistance first started, I had serious problems with it. It only rewarded people who bought more house than they could afford and thus ended up behind on payments. Yea, there were people who had planned more properly and got screwed later on, but it seemed to only help people who screwed up.  Then it was extended to people who were only in the unfortunate situation of losing a bunch of equity, like me. I am still not a huge fan of HARP as a whole, but I am taking advantage of it because I would be stupid not to.

I refinanced my home about a year after I bought it at a lower rate, dropping 1.375%. That was still on a 30 yr, but due to market losses, I ended up with more than 80% financed and thus PMI. My payment was still less and I am out of PMI now because I made it to less than 80% of appraised value being financed. Unfortunately market forces have made it so that is now about 98% of my house's current value.  That does mean I am able to do HARP though.

Why HARP? Because I can make my 30 year loan (that is 3 yr old) a 20 year loan at 1% lower rate and only have my payment go up $100/month. That chops 7 years off my payoff date assuming I pay the min and significantly reduced my total interest paid. And thanks to HARP, no PMI! So, I am getting rewarded in a way for being responsible and just getting screwed by the market.

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