They were on the verge of losing their home.
A lost job during the recession had taken its toll on the tri-state area couple. And the effects still lingered this summer.
The couple could no longer afford their mortgage payments. They knew they would either have to sell their home and downsize, or walk away from the whole thing.
They were at their wit’s end.
“They came in here thinking that we would turn them down because their credit had been destroyed,” says Krystal Frederick, a mortgage consultant at Dupaco.
But Dupaco didn’t turn the couple away. Instead, the credit union delivered them the ray of hope they had been waiting for.
What happened next
With the help of the government-sponsored program HARP, or Home Affordable Refinance Program, Dupaco refinanced the couple’s mortgage, making it possible for them to hold onto their home.
The program was established in 2009 after the housing market crash the previous year. It aims to make more homeowners eligible for traditional refinancing to make their homes affordable again.
“Many people were in a position where they either owed more on their home than it was actually worth or their credit dropped because they lost their job during that time and quit making payments,” Frederick says. “A lot of American citizens went through a crisis.”
When the local couple turned to Frederick this summer, they owed about $98,000 on their mortgage at an interest rate of 6 percent. Because they qualified for HARP, they gained access to Dupaco’s low mortgage rates. Dupaco refinanced their mortgage on a 30-year term at a rate of 4 percent.
The savings were huge, life-changing really.
Refinancing saved the couple $74,494.60 in interest over the life of the loan and $381 on their monthly mortgage payment.
“They were so happy we could do this for them,” Frederick says.
There’s still time
Homeowners looking to refinance through HARP at Dupaco must meet certain requirements.
The mortgage must have been sold to Fannie Mae on or before May 31, 2009. And the borrower must have an income. But each case is unique, and it’s important to talk to a mortgage consultant to determine eligibility.
Those who are eligible have access to Dupaco’s 30-, 20- and 15-year fixed rates, which remain low.
Even though the program has been available for five years, Frederick says there are still plenty of homeowners who haven’t taken advantage of this opportunity – either because they don’t know about it or assume they won’t be eligible because of their credit.
“I worry that the program will eventually end,” Frederick says. “We want to reach out to homeowners. We don’t charge to pull their credit or take an appointment to refinance, so why not run it through our system and see whether there’s something we can do to help put them in a better position? I always say it’s worth a shot.”
The program has been extended until Dec. 31, 2015.