The Federal Housing Finance Agency (FHFA) granted the Home Affordable Refinance Program (HARP) a two-year extension, the agency announced Thursday.
Under the direction of FHFA, Fannie Mae and Freddie Mac’s regulator, the program will live on until December 31, 2015. Without the extension, HARP would have expired at the end of this year.
“More than 2 million homeowners have refinanced through HARP, proving it a useful tool for reducing risk,” said FHFA Acting Director Edward J. DeMarco. “We are extending the program so more underwater borrowers can benefit from lower interest rate.”
Over the years, the program has helped hundreds of thousands of deeply underwater borrowers find relief. According to FHFA’s latest report, 252,443 borrowers with loan-to-value ratios over 125 percent have been able to refinance through the program.
The agency also announced it plans to launch a campaign in an attempt to reach more eligible borrowers for the program.
While the FHFA stated it can’t provide “hard estimates” on the number of additional homeowners who are eligible, the hope is for a substantial number to be reached.
FHFA also outlined the following eligibility requirements for the program in its announcement:
- The loan must be owned or guaranteed by the GSESs
- Loans must have been sold to the GSEs on or before May 31, 2009
- The mortgage can’t be one that was previously refinanced under HARP unless it is a Fannie Mae loan that was refinanced under HARP from March to May, 2009
- LTV must be greater than 80 percent
- Borrower must be current on their mortgage payments with no late payments in the last six months and no more than one late payment in the last 12 months
By Esther Cho