In 2009, the government launched its Making Home Affordable (MHA) initiative.
The MHA’s stated goals are to “help homeowners avoid foreclosure, stabilize the country’s housing market, and improve the nation’s economy”.
According to the Obama Administration’s January Housing Scorecard, a report jointly published by HUD and the U.S. Department of the Treasury, monthly economic indicators suggest that Making Home Affordable is working, and that the housing market is progressing into 2013.
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What Is Making Home Affordable?
The government’s Making Home Affordable program is a catch-all for a dozen government-backed mortgage and housing programs.
Some of the programs are well-known such as the Home Affordable Refinance Program (HARP) and the Home Affordable Modification Program (HAMP).
Other programs as less well-known, including the Home Affordable Unemployment Program (UP) through which eligible homeowners can get access to reduced mortgage payments, or a temporary mortgage payment suspension program.
Specific MHA programs exist for specific government-backed mortgages.
- Via Fannie Mae/Freddie Mac : HARP; HAMP; The Second Lien Modification Program
- Via the VA : Veteran’s Affairs Home Affordable Modification (VA-HAMP)
- Via the USDA : USDA Special Loan Servicing Program
- Via FHA : FHA Home Affordable Modification Program (FHA-HAMP), and The FHA Refinance For Borrowers With Negative Equity, also known as the “FHA Short Refi”
In addition, via Making Home Affordable, homeowners have access to the Home Affordable Foreclosure Alternatives Program (HAFA) and the Housing Finance Agency Innovation Fund for the Hardest Hit Housing Markets (HHF).
With so many alternatives for homeowners in need or want of help, MHA has helped to reduce the number of foreclosures nationwide by more than 1.4 million, and granted more than 2 million homeowners access to lower mortgage rates via HARP.
MHA has played a role in the housing market’s recovery since 2009.
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HARP And HAMP : Making Home Affordable Keystones
Making Home Affordable is comprised of a dozen loan programs. Overwhelmingly, the two most used are the Home Affordable Modification Program (HAMP) and the Home Affordable Refinance Program (HARP).
HAMP allows homeowners to lower monthly mortgage payments via loan modification.
Initial HAMP eligibility requirements from 2009 stated that mortgages must have been obtained on or before January 1, 2009; properties may not have been condemned; homeowners must exhibit a financial hardship which may lead to delinquency plus proof of sufficient income to support a modified payment, as well as a personal record free of mortgage- or real estate-related crimes.
Then, in June 2012, HAMP eligibility standards were broadened to include homeowners applying for rental property; with homeowners with debt-to-income ratios of 31 percent or lower; and homeowners who previously defaulted on a HAMP trial modifications or permanent modifications.
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HARP, by contrast, is a straight rate-and-term refinance program for underwater homeowners with the following eligibility requirements :
- The existing mortgage must be owned or guaranteed by Fannie Mae or Freddie Mac
- The existing mortgage must have a note date of no later than May 31, 2009
- The existing mortgage must not have not been refinanced via HARP, unless it was a Fannie Mae loan refinanced between March and May 2009
- The existing mortgage must have a loan-to-value (LTV) greater than 80 percent
- The existing mortgage must be current and have a good payment history going back 12 months
HARP is available in all 50 states and allows for unlimited loan-to-value. No matter how far underwater your mortgage is, so long as you meet the above eligibility standards, you may be HARP eligible.
HARP was revised in October 2011, and re-released as HARP 2. A “HARP 3” bill is making its way through Congress now, and may pass as soon as Q2 2013.
HARP 3 is expected to give homeowners with non-Fannie Mae and Freddie Mac mortgages access to the program.
Click here to check your MHA mortgage rates and eligibility
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Are You Eligible For HAMP Or HARP?
The MHA’s HARP and HAMP programs, as well as the FHA Short Refi and other modification plans, are time-limited programs. HARP, for example, is slated to end December 31, 2015.
If you’re a current homeowner unable to refinance — either because of falling home values or because a change in life situation — consider applying for one of Making Home Affordable’s many mortgage options.
HARP mortgage rates are low. Many refinancing homeowners save 33% on their payment or more.
Time to make a move? Let us find the right mortgage for you
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