The regulator of Fannie Mae and Freddie Mac is considering whether to allow refinances in excess of 125 percent.
The Home Affordable Refinance Program was originally launched in March 2009.
At the time, the Department of the Treasury projected that 4 million to 5 million borrowers would benefit from the program. So far, 838,000 borrowers have refinanced through the program.
HARP is available to borrowers who are current and whose loans were originated before June 2009 and sold to either of the secondary lenders. Borrowers with loan-to-value ratios between 80 percent and 125 percent are eligible. Mortgage insurance is carried over from the prior transaction.
The program has been extended twice and currently runs until June 2012.
On the heels of President Barack Obama’s speech Thursday that indicated the administration intends to work with federal agencies to help more borrowers take advantage of historic rates, Federal Housing Finance Agency Acting Director Edward J. DeMarco said that his agency is looking at how HARP can be enhanced while reducing risk for Fannie and Freddie.
“FHFA is also considering the barriers to refinancing mortgages that would otherwise be HARP eligible but for having a current LTV above 125 percent, HARP’s current ceiling,” DeMarco said in a statement. “There are several challenging issues to work through here and the outcome of this review is uncertain.
“Still, FHFA is carefully analyzing this group of enterprise loans for inclusion in HARP.”
