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Home Affordable Refinance Program Extended


Despite ongoing criticism and a number of recent bills aimed at ending several government mortgage assistance programs, the Home Affordable Refinance Program (HARP) has been extended by one year, per the Federal Housing Finance Agency.

The FHFA announced Friday that HARP’s original expiration date of June 30 of this year would be pushed back to June 30, 2012.

Additionally, Freddie Mac will exempt HARP mortgages from their recently announced pricing adjustments and Fannie Mae will conform their eligibility date to May 2009.

Through 2010, government mortgage financiers Fannie Mae and Freddie Mac purchased or guaranteed more than 6.8 million refinanced mortgages.

Of these, 621,803 were HARP refinances with loan-to-value ratios between 80 percent and 125 percent.

This total is up from 190,180 in 2009, when HARP first began.

HARP allows those with underwater mortgages (up to 125% loan-to-value) owned or guaranteed by Fannie Mae and Freddie Mac to refinance to take advantage of the historically low mortgage rates on offer.

The loan program actually seems pretty worthwhile, given the fact homeowners must be current on their mortgage payments and demonstrate the ability to repay their mortgages.

The Home Affordable Modification Program, which makes up the other half of the Making Home Affordable Program, is expected to be on the chopping block later this week, mainly because of poor performance (HAMP will only prevent 700,000 foreclosures) and high costs.

Of course, such bills to halt the program are likely just political, as President Obama has already noted that bills to end similar programs would be vetoed if they happened to make it to his desk.

The only possibility could be some fine-tuning to the existing programs, but even that is doubtful.

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