Federal Housing Finance Agency Announce Changes To HARP

Filed in HARP Program Updates by on February 29, 2012 4 Comments

On October 24, 2011, the Federal Housing Finance Agency announced that it is making a series of changes to the Home Affordable Refinance Program (HARP). The changes are intended to allow even more underwater homeowners refinance under HARP. The biggest change is the elimination of the 125 LTV ceiling on HARP loans. This means that theoretically, a borrower can refinance no matter how far they are underwater.

Some of the proposed changes include:

  • Eliminating certain risk-based fees for borrowers who refinance into shorter-term mortgages and lowering fees for other borrowers;
  • Removing the current 125 percent LTV ceiling for fixed-rate mortgages backed by Fannie Mae and Freddie Mac;
  • Waiving certain representations and warranties that lenders commit to in making loans owned or guaranteed by Fannie Mae and Freddie Mac;
  • Eliminating the need for a new property appraisal where there is a reliable AVM
  • (automated valuation model) estimate provided by the Enterprises; and
  • Extending the end date for HARP until Dec. 31, 2013 for loans originally sold to the Enterprises on or before May 31, 2009.

Only those who have a job and are current on their Freddie Mac- or Fannie Mae-owned mortgages are eligible for the new program. Those who have already refinanced with HARP are not eligible.

Edward Demarco, the Acting Director of the FHFA commented:

“We know that there are many homeowners who are eligible to refinance under HARP and those are the borrowers we want to reach. Building on the industry’s experience with HARP over the last two years, we have identified several changes that will make the program accessible to more borrowers with mortgages owned or guaranteed by the Enterprises. Our goal in pursuing these changes is to create refinancing opportunities for these borrowers, while reducing risk for Fannie Mae and Freddie Mac and bringing a measure of stability to housing markets”.

Fannie Mae and Freddie Mac will issue guidance on the HARP updates to lenders and servicers by November 15, 2011. At that time we should have additional clarity on the eligibility requirements for the new version of HARP. It is possible that these changes could take effect as soon as December 2011.

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  1. earlie shields says:

    i have tried to refinance under the harp program i met all qualifications, have great credit, never been late on mortgage. the problem is i was told that i had to prove that i made all payments on mortgage without the help of my then signifcant other. i did prove that, i was informed that out of the last 12 payments, 3 of which was made from a joint account with my estranged husband whom hold no interest in the account, that i would not be able to refinance under the harp program because they say it was not my OWN money that the 3 payments were made. not true, i even told them that my estranged husband would sign an affadavit stating that he holds no interest in that account and has never made any transactions into or from that account. for that reason, and that reason only, i was DENIED. help what are my options, when i now that i qualfiy,and being given the shaft to keep me at a higher interest rate

  2. Dan J. says:

    Sounds like Citibank

  3. monita darden says:

    this entire obama rescue plan is a joke i have beginning the run arounds by every company i can name i even filed bankruptcy in 2010 to help me keep my home and still nothing im at the end of my rope imma thinking about just walking away for real

  4. monita darden says:

    its ashame they say the help is out there keep denying you and try to give u no alternative routes are resolutons

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