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Watt Announces One-Year Extensions Ford HARP and HAMP

May 11, 2015

May 8, 2015

The government’s Home Affordable Refinance Program (HARP) and Home Affordable Modification

Program (HAMP) will be extended until the end of 2016, according to an announcement from FHFA

Director Mel Watt on Friday.

Speaking at the Greenlining Institute 22nd Annual Economic Summit, Watt announced a one-year

extension of the government’s two affordable housing programs, which began in 2009 in response to the

housing crisis. Both programs were set to expire at the end of 2015.

“Since HAMP and HARP were first launched in 2009, these programs have provided critically important

relief for many borrowers by allowing them to lower their monthly payments and, as a result, have

prevented many foreclosures,” Watt said. “HAMP provides modifications that allow borrowers significant

payment reductions that are tied to their income. This gives borrowers a more stable, affordable monthly

payment and improves performance rates.  The HARP program allows borrowers, including those who are

underwater on their mortgage and who are regularly making their mortgage payments, to refinance their

loans to take advantage of historically low interest rates.”

HARP is a program intended to help save money by lowering monthly payments for borrowers who are

underwater but are regularly making mortgage payments, while HAMP is targeted toward borrowers who

are delinquent and possibly facing foreclosure by providing them a modification with significantly reduced

monthly payments tied to their income.

The participation rates for both programs have on the decline, partly because many borrowers are

already participating in one program or the other, and partly because of recovering house prices, Watt

said, but lenders and sevicers continue to approve modifications through HAMP and refinances through

HARP.

“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,” Watt said.

Watt said that this will be the final extension for FHFA’s participation in HAMP and he anticipates that this

will be the final extension for HARP, adding that neither program was intended to be permanent.

source: http://dsnews.com/news/05-08-2015/watt-announces-one-year-extensions-for-harp-and-hamp



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