FHFA Extends Refinance Program

FHFA (Federal Housing Finance Agency) acting director Ed Demarco stated yesterday the extension of the Home Affordable Refinance Program, a refinancing program administered by Freddie Mac and Fannie Mae, to June 30, 2011. The HARP program expands access to refinancing for qualified individuals and families whose homes have lost value. The program was set to expire on June 30th of this year.

"FHFA has reviewed the current market situation and the state of the mortgage insurance availability and has determined that the market conditions that necessitated the actions taken last year have not materially changed." said De Marco. "Accordingly, to support and promote market stability, and to encourage lenders and other mortgage market participants to fully adopt the HARP program, including the implementation of the October 2009 expansion of loan to value ratios to 125%, FHFA is authorizing the extension of HARP until June 30th 2011."

I don't know how many folks this will help, but most who could have refinanced have already done so and how many homes will qualify. Unfortunately the people this program is supposed to help are more than 25% below market. For these borrowers there property values have dropped so much they no longer can qualify. Nice to see the effort but I think it could be too little too late.