Two crisis-era programs that have the government funding mortgage refinances and loan modifications will be extended by a year.
In early 2009, the Homeowner Affordability and Stability Plan was announced by the Treasury Department. It included the Making Home Affordable initiative.
One MHA component is the
Home Affordable Modification Program. As of February 2015, nearly 1.5 million HAMP modifications have been completed.
Another
MHA component is the Home Affordable Refinance Program. Life-to-date HARP volume amounts to 3.3 million refinances as of February.
While both programs were scheduled to end in 2013, they were extended through the end of this year.
In June 2014, the Departments of the Treasury and Housing and Urban Development announced that HAMP would be extended until the end of 2016.
But a spokesperson for the Federal Housing Finance Agency, which is the conservator and regulator of Fannie Mae and Freddie Mac, confirmed the following month that any extension of HARP would require the FHFA director’s approval and no plans were in place to extend the program at that point.
On Friday, however, FHFA Director Melvin L. Watt told attendees at the Greenlining Institute 22nd Annual Economic Summit that
the government-sponsored enterprises’ participation in HAMP and HARP is being extended until Dec. 31, 2016.
“Although the number of new borrowers entering these two programs continues to decline, in part because many eligible borrowers have already taken advantage of them and in part because of recovering house prices, lenders and servicers are continuing to approve new HAMP modifications and HARP refinances,” Watt said according to a prepared transcript of his speech. “Extending HAMP and HARP through the end of 2016 will provide real relief for borrowers who continue to face challenges either paying their mortgage or refinancing their loan.”
But the regulator noted that this was the final extension for both programs.
