July 22nd, 2014 7:27 AM by Jackie A. Graves, President
are struggling to make their mortgage payments and those who lack the equity to refinance will
continue to get help through a government program that had been set to expire.
The Making Home
Affordable (MHA) program, which includes both the Home Affordable Refinance
Program (HARP) and the Home Affordable Modification Program (HAMP), has been
extended through December 31, 2016.
Secretary Jacob Lew announced the extension June 26 as part of the MHA Fifth
Since the MHA
program was introduced in April 2009, it has enabled more than 1.3 million
homeowners to permanently modify their mortgage loans through HAMP. More than
3.1 million homeowners have refinanced their loans with the help of the HARP
HARP and HAMP
program, designed to allow homeowners who are underwater on their
loans to refinance into mortgages with lower interest rates,
is limited to homeowners with loans guaranteed or owned by Fannie Mae and
In the first
quarter of 2014, 23% of all refinances were part of the HARP program, but the
number of HARP refinances as well as all other refinances has slowed in recent
six million homeowners in the U.S. are still underwater on their loans,
according to Lew. Many of those homeowners could benefit from a refinance,
provided they have strong enough credit to qualify for a new loan and can
afford to pay closing costs.
In order to be
eligible for HARP, your loan must
have been sold to Fannie Mae or Freddie Mac before May 31, 2009.
The HAMP program—designed
to help homeowners who can no longer afford their home loan payments—is
available to borrowers who took out a loan before Jan. 1, 2009, that is owned,
insured or guaranteed by Fannie Mae, Freddie Mac, the Federal Housing
Administration (FHA), the Department of Veterans Affairs (VA) or the U.S.
Department of Agriculture (USDA).
provide evidence of financial hardship and make on-time loan payments during a
trial period before their loan can be permanently modified.
As the effects
of the housing crisis and the recession linger, many homeowners continue to
struggle to make their mortgage payments and rebuild equity in their homes.
While the recovery has helped millions of homeowners regain their home value,
not all neighborhoods have seen values rise to their pre-recession levels.
foreclosure crisis has slowed.
foreclosure and real estate data tracking firm, reporting that total
foreclosure activity in May fell to the lowest level since 2005. The
continuation of HARP and HAMP are meant to prevent an uptick in foreclosure
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