Expanded HARP program can help homeowners

Q: Regarding the HARP program, this is not for homeowners who are current with their mortgage payments and have successfully modified their home mortgage loans, right?

Have you any knowledge of any government programs in the near future regarding people who are underwater with their mortgages? Government should be working on help for us. (Have you) read or heard anything?

Thank you and continue your good work.

-- Mrs. Gamez, Las Vegas

A: The federal Home Affordable Refinance Program that you mentioned is certainly not a solution for every distressed homeowner here in Southern Nevada. But it is being expanded, and it might just be the best available government program many underwater homeowners have right now.

As President Barack Obama announced recently, and as one of his top housing officials explained during a visit to Las Vegas in January, HARP is being expanded in an attempt to help more homeowners who are underwater, or owe more on their mortgage than their home is worth.

We've known for months that the expanded HARP program is now open to investor-owned properties. However, homeowners who already refinanced under HARP can't do it again.

To better answer your question about whether homeowners who have already modified their mortgage can use HARP to do so again, I consulted Vickie Henry, a senior management analyst at the Department of Housing and Urban Development. She put it this way: "The guidelines provided by Fannie Mae and Freddie Mac are silent should a previous modification be a barrier to refinancing under HARP 2.0."

As for your question about "future programs for underwater mortgages," Henry added that "you may have heard President Obama during the State of the Union address (Jan. 24) announce a new refinance program for homeowners that are current and have been making their mortgage payments throughout the housing crisis. 

HUD Secretary Shawn Donovan also spoke of the same new program during his visit to Las Vegas (Jan. 25), wherein he reiterated President Obama's announcement that the program details are to be published and publicly announced in the coming weeks. 

At this time, we have not been advised of any specific details of this new program or the qualification requirements, but expect to be notified in the coming weeks." 

Speaking to community leaders in Las Vegas last month, Donovan said a key part of this plan involves extending the 2009 HARP program.

The current refinancing program applies only to loans approved by Fannie Mae and Freddie Mac, but Donovan said Obama's new proposal would make the program available to an estimated 2 to 3 million U.S. homeowners with mortgages not guaranteed by these two government-backed entities.

The administration has suggested that fees on major banks could fund these initiatives.

In any case, my friends in the mortgage business say it's best to ask your mortgage servicer (the company that receives your mortgage payments) if it participates in HARP. 

Not all mortgage servicers do. And contact Fannie Mae or Freddie Mac to determine if you're eligible for HARP, which has been scheduled to end on Dec. 31, 2013.

To refresh your memory, HARP was designed to help homeowners who bought during the housing boom but haven't been able to refinance because their homes aren't worth enough to secure a new mortgage through traditional refinancing.

The goal is to help homeowners avoid foreclosures by lowering their mortgage payments.

The original version of HARP allowed homeowners with mortgages backed by the federal loan agencies of Fannie Mae and Freddie Mac to refinance, but only if their new loans were no more than 125 percent of the current value of their home.

In Southern Nevada, where an estimated two of every three homeowners are now underwater, that wasn't much help.

A recent update to this program, or HARP 2.0, removed that loan-to-value restriction.

This can only increase the number of distressed homeowners who qualify. But it remains to be seen how many Nevadans might find some relief through this and other government programs.

For one thing, it's still not clear if the nation's biggest banks are going to participate in HARP.

A good online resource is making
homeaffordable.gov.

To see if Freddie Mac owns your mortgage, visit freddiemac.com/mymortgage. To see if Fannie Mae owns your mortgage, visit fanniemae.com/loanlookup.

And if you simply can't afford your home, a short sale or "deed-in-lieu of foreclosure" may be your best option.

If you can't reach your lender, call a housing counselor certified by HUD at 800-569-4287 or visit hud.gov/offices/hsg/sfh/hcc/hcs.cfm to find one near you. They can help you contact and work with your lender, free of charge.

For more information about buying or selling homes and related issues, consult a qualified local Realtor or visit lasvegasrealtor.com.

Kolleen Kelley is the 2012 president of the Greater Las Vegas Association of Realtors and has worked in the real estate industry for more than 30 years. To ask her a question, email her at ask@glvar.org. For more information, visit lasvegasrealtor.com.