There have been some rumblings about a HARP 3.0 (Home Affordable Refinance Program) that could be launched sometime this year, with the hopes of broadening the field of those eligible to receive the loan. Under the current HARP program, the following requirements must be met to take advantage of its benefits:
The current major benefits for the program’s consumers are:
The big difference between the current program and the proposed HARP 3.0 is that the loans do not have to be backed by Fannie Mae or Freddie Mac, which could make all the Alt-A, subprime, and jumbo loans (non-conforming loans) eligible for the same benefits.
FHFA (Federal Housing Finance Agency), who acts as conservator for Fannie and Freddie, has recently changed directors, with the hope being that Mel Watt, who replaced Ed DeMarco, would be able to push the president’s HARP 3.0 plan into law. But to the dismay of those in favor of the new program, he recently stated at a conference with the Brookings Institute that he sees no foreseeable changes in the current HARP program. Two changes in the housing and mortgage markets that have been major factors to this are: