Under the current HARP underwater refinance program, in order to qualify, your existing mortgage loan must be owned by Fannie Mae or Freddie Mac.
If passed, the bill would force Fannie Mae and Freddie Mac to refinance non-Fannie Mae or Freddie Mac loans, and to price in the additional risk into the interest rate so that the program would not cost taxpayers anything.
Merley was quoted as saying the “It shouldn’t matter which financial institution owns a loan…” and that “all responsible homeowners should have the option to refinance and save money.”
Merkley also introduced another bill that would encourage people to refinance into loans terms of less than 20-years, which builds equity faster, by paying $1,000 of underwater homeowners closing costs.
Previous attempts at a HARP 3 program, or modifying the current HARP 2 program have not gain much traction in Washington, and these two new bills have no other sponsors.