Would you like to payoff your mortgage in 15 yrs instead of 30 yrs?

If you are in your 40’s or 50’s this is probably becoming a nagging concern as you start to look towards retirement on the horizon.  Even if you are in your 20’s or 30’s, and are fortunate enough to have a good job with a little extra money each month, you may find the thought of paying off your home mortgage faster very attractive.  In either case, having a shorter mortgage term will allow you to build equity in your home quicker.

Using the Harp Loan Refinance program, you can refinance to a shorter term mortgage and meet your financial goals.  This is one of the government sponsored loan refinance programs that are currently available to help underwater homeowners keep their homes.  However, there are some criteria to meet and the program is scheduled to end on December 31, 2013, so you will need to act now.

You may be eligible for HARP if you 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%.
The borrower must be current on the mortgage at the time of the refinance, with a good payment history in the past 12 months.

Currently their is no upper limit on the LTV ratio for homeowner under the HARP loan program, however, your lender, or the company you make your mortgage payments to (the loan servicer), may not be participating in the program.  You will need to call and check with them.

As an example of some real world numbers that illustrate the difference in monthly payments under this program.

Using a 200k loan balance:
A 30 yr loan at 6.5% will have a monthly payment of $1,264.
A 15 yr loan at 3.0% will have a monthly payment of $1,381.

Using the example above, for a mere $117 per month, you will be able to pay off your mortgage in half the time!  Additionally, you will also save $206, 480 dollars in interest payments!  Talk about a retirement plan, this may be the best retirement savings plan you ever participate in.

We would also strongly suggest that you contact multiple lenders to compare the best rates and terms of the offer before deciding on who to use for your refinance.