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Can I Get a HARP Refinance with a 2nd Mortgage?


San Diego, California – One of the most common questions we get online today is in regards to HARP refinancing eligibility for people that have a second mortgage. The quick answer is YES, “The Home Affordable Refinance Program allows borrowers to refinance even if they have a 2nd mortgage.” NO, you cannot combine a 1st and 2nd mortgage together in a HARP refinance, but they will allow you to subordinate your current second lien and refinance your underwater 1st mortgage. So if you want to refinance under the HARP 2.0, your second mortgage lender must complete the subordination agreement. This makes choosing a HARP mortgage lender more important than ever, because you need to choose a company that has enough experience with the HARP 2.0 program that they handle the subordination end properly so that your loan will fund prior to your interest rate lock expiring. Get quotes from lenders offering mortgage pre-approvals that have experience subordinating with HARP 2.0.

HARP Refinancing with a Second Loan Being Subordinated is Allowed!

  • In most cases the lender you choose for the new HARP refinance will do the work to get your 2nd loan subordinated.
  • Of course it won’t hurt to let your 2nd mortgage lender know that you are refinancing your 1st lien and you will need their cooperation in the subordination process.
  • Ask how much they charge for the subordinating. (2nd lenders fees will vary)
  • Find out if getting the check to the 2nd lender upfront will streamline the process.

Unfortunately not all mortgage companies handle the subordination the same. If you are a hands’ on person who wants to help out then you need to know this up front.  Most borrowers do not want to deal with this, so they let their HARP lender handle the process of subordinating the 2nd mortgage. According to Pat O’Connell of VIP Mortgage in Orange County, choosing lenders for HARP is important. “It is imperative that you feel confident that your lender can handle the subordination process, because the average loan company will drop the ball.”

Refinancing with HARP Can Save You Thousands of Dollars a Year!

If you want to refinance with HARP will save you money every month than most likely it will be worth it for you to move forward even if you have to deal with a subordinating a 2nd loan. We suggest adding 15 days to your rate lock or floating the rate. For example, if you were refinancing with a 30-day lock, stretch it to 45-days if you have a second mortgage.

Today’s HARP rates have fallen to 3.5% (APR 3.74%) on thirty-year terms and 2.875% (APR 2.97%) on fifteen-year options. So use the rate calculators and do the math so you can determine how much you are saving. If you can save $600 a year then it is likely worth your time. If you are saving $2,000 or $3,000 a month like many of our clients then it is certainly worth the time. Take a few minutes and apply online for unique refinancing even if you have a 2nd mortgage the option is available for a HARP refinance.

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We have been trying to refinance for a few months but our bank is not cooperating with the subordination request. What do you suggest we do. Our rate lock already expired and the company we are trying to refi with are acting like it may not happen. Help!

Nationwide Lender
July 30th, 2012 at 4:07 pm

We understand how frustrating this process can be when you have 3 parties involved and only really 2 appear to be motivated. I have a few questions for you Phil – Have you seen the subordination request completed for the 2nd mortgage lender? How much did the they charge to subordinate the lien? Have you verified that the company was actually paid to subordinate? Please let us know and we will try and get you some answers that help your situation with HARP.


We recently to out a credit line that was secured to our home for $50,000. We used the funds for remodeling but how our first loan is still way underwater. Can we refinance our loans together under the Home AFfordable Mortgage Act?
We would really appreciate your advice.
Thanks- Mary S.

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