Many Arizona homeowners underwater with their mortgages are anxiously awaiting more information on how they can lower their interest rates and payments through the expansion of the government's Housing Affordable Refinance Program.
But details on the program have been delayed. Information on which homeowners are eligible and how to apply was supposed to be released by now but will likely come out next week. However, government mortgage giants Fannie Mae and Freddie Mac have begun providing lenders information on how to handle the expansion of HARP. Only homeowners with loans held by those entities are eligible to refinance, no matter how much more they owe on their home than its actually worth.
From the new information sent to lenders, it's now clear not all borrowers with Fannie Mae and Freddie Mac mortgages are eligible. A loan-to-value ratio of 105 percent is still in effect for borrowers with mortgages that have longer terms than 30 years or adjustable-rate mortgages with terms of five years or higher.
While some borrowers can start applying to refinance as soon as Dec. 1., others with loan-to-value ratios above 125 percent will have to wait until at least February of next year.
Some questions and answers:
Q: Phoenix-area homeowner Marla Griggs knows she's not eligible for the refinancing program but is coming up on the end of the five-year point of her option-adjustable mortgage. The loan is not owned by Fannie Mae or Freddie Mac, and she wants to know her options for keeping her home by refinancing and lowering her payment.
"Many people are not eligible for this program. Why can't it be applied to all mortgages?" she asks.
A: The federal government hasn't been able to make privately owned lenders readily participate in its programs, including loan modifications, to help homeowners avoid foreclosure. When U.S. Department of Housing and Urban Development Secretary Shaun Donovan talked to The Arizona Republic a few weeks ago, he was well-aware that the refinancing program wouldn't help everyone. He said the government has to do what it can do to help the most homeowners now, and then hope the plans will catch on with lenders.
Jay Luber of Phoenix-based Galaxy Lending said early instructions from Fannie and Freddie show it won't be until March when the refinancing programs to help many metro Phoenix borrowers will likely be available.
Sorry, Marla, that doesn't help you. But housing advocates say to call Arizona's foreclosure hotline at 877-448-1211.
Q: Bruce Robinson asks, "What about all of us poor souls out here with FHA (insured) mortgages? We represent a huge portion of the outstanding mortgage market, and yet I read nothing indicating that the administration is doing anything for us.
"FHA's existing 'Streamline' refinance program is nothing more than a hollow promise. First, the fees are incredible, with FHA requiring a whole new up-front guarantee fee. Then, FHA is charging monthly 'mortgage insurance,' which is more than double that which is charged on most existing loans. Many mainstream national mortgage lenders appear to be simply avoiding 'Streamline' since it is so disadvantageous to most FHA borrowers."
A: I am hearing the same issues from many FHA borrowers. But mortgage brokers are beginning to report more success with the streamlines, partially due to more government focus on the program. The big issue is you have to stay in your home several years after the streamline for the additional fees to make sense. Donovan mentioned that some changes could be made to the FHA program, as well. I will write about those as soon as information is available.
by Catherine Reagor The Arizona Republic Nov. 26, 2011 12:00 AM
Details of refinancing eligibility trickling in
Showing posts with label harp. Show all posts
Showing posts with label harp. Show all posts
Sunday, November 27, 2011
Sunday, November 13, 2011
More Arizonans can refinance for underwater mortgages under new plan
Many homeowners will be able to find out next week how to seek refinancing, no matter how underwater they are on their mortgages.
A federal mortgage program announced by President Barack Obama three weeks ago will smooth the refinancing process and overcome hurdles that so far have blocked many in Arizona and elsewhere from lowering their interest rates and mortgage payments.
In an interview with The Arizona Republic on Thursday, Department of Housing and Urban Development Secretary Shaun Donovan said full details of the program will be released Tuesday.
Donovan said officials are working to cut fees associated with refinancing by half or more and creating much less stringent requirements for qualifying, including eliminating credit checks.
The program's main intent is to assist homeowners who want to refinance to current mortgage rates. On a $250,000 mortgage, a switch from a 6 percent rate to the current rate of about 4 percent would cut the monthly payment by $300.
But many metro Phoenix homeowners have been unable to refinance because of plunging home values. In a typical deal, a bank would not issue a new loan unless the home's current value was enough to cover at least the amount of the loan. Since 2009, a federal program has allowed some homeowners to refinance for as much as 125 percent of their home's value.
But in metro Phoenix, where values have dropped more than 60 percent since 2007, many homeowners still couldn't qualify.
Estimates show nearly half of Arizona's mortgage holders are underwater.
The new program, as laid out by the president, would be open only to homeowners who are current on their payments or have missed no more than one in the past year.
It applies only to those with mortgages backed by government-owned mortgage giants Fannie Mae and Freddie Mac, but the two entities back more than half of all mortgages, meaning many homeowners are likely eligible.
Refinancing to lower payments could prevent more homeowners underwater on their mortgages from walking away and adding to the foreclosure crisis.
"We continue to work on the foreclosures problem, but we want to make sure to help those people paying their mortgages, even when they owe so much more than their is home is valued at," Donovan said.
Donovan was in Phoenix, just two days after Treasury Secretary Timothy Geithner visited the region, to talk to government and housing leaders about programs within Obama's American Jobs Act, which was voted down in the Senate.
The HUD secretary spent part of the morning touring a south Phoenix neigborhood that received federal Neighborhood Stabilization funds. Donovan was promoting Project Rebuild, which was part of the job bill.
He said Project Rebuild could create thousands of jobs and rehab almost 9,000 homes statewide.
U.S. Rep. Ed Pastor, D-Phoenix, said neighborhood assistance is key in the area.
"When you have foreclosures, what happens is it not only hurts families, but it has an effect on the neighborhood, on the schools, on the businesses around it," Pastor said.
After the tour, Phoenix Mayor Phil Gordon noted the region needs as much as anywhere in mitigating the effects of the housing crash.
"Phoenix got hit as hard or harder than anyone," he said.
The refinancing plan is an expansion of the Home Affordable Refinancing Program, which previously allowed refinancing up to only 125 percent of a home's value.
On Thursday, Donovan laid out five hurdles the government had to overcome to expand HARP.
1. Find a market for mortgages with loan-to-value ratios above 125 percent, the old limit on the program.
Currently, most loans are bundled together as securities and resold to investors, who make money off homeowners' interest payments.
But the market doesn't currently deal with loans that are underwater from the beginning. Donovan said the federal government will either create new securities to sell to investors or add a portfolio to hold the loans in.
2. Cut the cost of refinancing.
Donovan said federal officials will approve automated appraisals so they don't cost homeowners. They also are negotiating with title firms to cut their fees by at least half.
3. Prevent second mortgages from stalling the process.
Currently, banks that issue second mortgages can object to a refinancing deal on the original loan. Donovan said many second-lien holders have held up refinancings by trying to gain some leverage or cash in the deal.
Federal officials negotiated with lenders, Donovan said, persuading the top five U.S. lenders, which hold 60 percent of the nation's second mortgages, to allow the deals on first loans so the refinancing program will work.
"In some cases, lenders agreed purely out of self-interest," he said. "If borrowers have smaller payments on their first mortgage, they have more funds to pay their second mortgages."
4. Reduce the risk for lenders.
Fannie Mae and Freddie Mac help lenders issue more mortgages by buying up those mortgages after they are written. But recently, the mortgage giants have attempted to force banks to buy back problematic loans. Under the new program, Fannie Mae and Freddie Mac will agree not to force such buybacks except in cases of fraud. This will also make the refinancing program more competitive. Lenders can seek new business through refinancing without taking on a new liability.
5. Reduce the risk for mortgage insurers.
The program will allow for mortgage insurers to transfer a policy from the borrower's old loan to the newly refinanced loan easily and with little or no fee.
The final guidelines for the program will be out next week, which will tell homeowners how to apply.
While much government mortgage aid has intentionally tried to exclude investors and landlords, the new program also will be open, in some cases, to people who have a mortgage but don't live in the home.
People who now rent out their homes because they couldn't afford the payments or had to move for a job will also be eligible, Donovan said.
Still, he made it clear that investors, who bought homes solely to use them for rental or investment income, won't qualify.
Homeowners can check to see if their loan is backed by Fannie Mae or Freddie Mac by going to www.makinghomeaffordable.gov.
The program is available to borrowers with loans backed by Fannie Mae or Freddie Mac in 2009 or earlier.
Borrowers don't have to refinance through their original lender and could likely get offers from others.
Donovan made clear it doesn't matter if a homeowner is 100 percent underwater or 200 percent underwater because Fannie and Freddie are already carrying that risk on their books. He said what is important is that the borrower has been paying and deserves to be rewarded for it.
Full credit checks won't be run on eligible borrowers because they have been making their payments, another move that will save costs. In some cases, lenders might call a borrower's employer to see if he or she still has a job, he said.
"We want this program to spread beyond Fannie and Freddie loans," he said "Now, we are talking to lenders about refinancing underwater borrowers on loans the federal government isn't involved in."
by Catherine Reagor and Maria Polletta The Arizona Republic Nov. 11, 2011 12:00 AM
More Arizonans can refinance for underwater mortgages under new plan
A federal mortgage program announced by President Barack Obama three weeks ago will smooth the refinancing process and overcome hurdles that so far have blocked many in Arizona and elsewhere from lowering their interest rates and mortgage payments.
In an interview with The Arizona Republic on Thursday, Department of Housing and Urban Development Secretary Shaun Donovan said full details of the program will be released Tuesday.
Donovan said officials are working to cut fees associated with refinancing by half or more and creating much less stringent requirements for qualifying, including eliminating credit checks.
The program's main intent is to assist homeowners who want to refinance to current mortgage rates. On a $250,000 mortgage, a switch from a 6 percent rate to the current rate of about 4 percent would cut the monthly payment by $300.
But many metro Phoenix homeowners have been unable to refinance because of plunging home values. In a typical deal, a bank would not issue a new loan unless the home's current value was enough to cover at least the amount of the loan. Since 2009, a federal program has allowed some homeowners to refinance for as much as 125 percent of their home's value.
But in metro Phoenix, where values have dropped more than 60 percent since 2007, many homeowners still couldn't qualify.
Estimates show nearly half of Arizona's mortgage holders are underwater.
The new program, as laid out by the president, would be open only to homeowners who are current on their payments or have missed no more than one in the past year.
It applies only to those with mortgages backed by government-owned mortgage giants Fannie Mae and Freddie Mac, but the two entities back more than half of all mortgages, meaning many homeowners are likely eligible.
Refinancing to lower payments could prevent more homeowners underwater on their mortgages from walking away and adding to the foreclosure crisis.
"We continue to work on the foreclosures problem, but we want to make sure to help those people paying their mortgages, even when they owe so much more than their is home is valued at," Donovan said.
Donovan was in Phoenix, just two days after Treasury Secretary Timothy Geithner visited the region, to talk to government and housing leaders about programs within Obama's American Jobs Act, which was voted down in the Senate.
The HUD secretary spent part of the morning touring a south Phoenix neigborhood that received federal Neighborhood Stabilization funds. Donovan was promoting Project Rebuild, which was part of the job bill.
He said Project Rebuild could create thousands of jobs and rehab almost 9,000 homes statewide.
U.S. Rep. Ed Pastor, D-Phoenix, said neighborhood assistance is key in the area.
"When you have foreclosures, what happens is it not only hurts families, but it has an effect on the neighborhood, on the schools, on the businesses around it," Pastor said.
After the tour, Phoenix Mayor Phil Gordon noted the region needs as much as anywhere in mitigating the effects of the housing crash.
"Phoenix got hit as hard or harder than anyone," he said.
The refinancing plan is an expansion of the Home Affordable Refinancing Program, which previously allowed refinancing up to only 125 percent of a home's value.
On Thursday, Donovan laid out five hurdles the government had to overcome to expand HARP.
1. Find a market for mortgages with loan-to-value ratios above 125 percent, the old limit on the program.
Currently, most loans are bundled together as securities and resold to investors, who make money off homeowners' interest payments.
But the market doesn't currently deal with loans that are underwater from the beginning. Donovan said the federal government will either create new securities to sell to investors or add a portfolio to hold the loans in.
2. Cut the cost of refinancing.
Donovan said federal officials will approve automated appraisals so they don't cost homeowners. They also are negotiating with title firms to cut their fees by at least half.
3. Prevent second mortgages from stalling the process.
Currently, banks that issue second mortgages can object to a refinancing deal on the original loan. Donovan said many second-lien holders have held up refinancings by trying to gain some leverage or cash in the deal.
Federal officials negotiated with lenders, Donovan said, persuading the top five U.S. lenders, which hold 60 percent of the nation's second mortgages, to allow the deals on first loans so the refinancing program will work.
"In some cases, lenders agreed purely out of self-interest," he said. "If borrowers have smaller payments on their first mortgage, they have more funds to pay their second mortgages."
4. Reduce the risk for lenders.
Fannie Mae and Freddie Mac help lenders issue more mortgages by buying up those mortgages after they are written. But recently, the mortgage giants have attempted to force banks to buy back problematic loans. Under the new program, Fannie Mae and Freddie Mac will agree not to force such buybacks except in cases of fraud. This will also make the refinancing program more competitive. Lenders can seek new business through refinancing without taking on a new liability.
5. Reduce the risk for mortgage insurers.
The program will allow for mortgage insurers to transfer a policy from the borrower's old loan to the newly refinanced loan easily and with little or no fee.
The final guidelines for the program will be out next week, which will tell homeowners how to apply.
While much government mortgage aid has intentionally tried to exclude investors and landlords, the new program also will be open, in some cases, to people who have a mortgage but don't live in the home.
People who now rent out their homes because they couldn't afford the payments or had to move for a job will also be eligible, Donovan said.
Still, he made it clear that investors, who bought homes solely to use them for rental or investment income, won't qualify.
Homeowners can check to see if their loan is backed by Fannie Mae or Freddie Mac by going to www.makinghomeaffordable.gov.
The program is available to borrowers with loans backed by Fannie Mae or Freddie Mac in 2009 or earlier.
Borrowers don't have to refinance through their original lender and could likely get offers from others.
Donovan made clear it doesn't matter if a homeowner is 100 percent underwater or 200 percent underwater because Fannie and Freddie are already carrying that risk on their books. He said what is important is that the borrower has been paying and deserves to be rewarded for it.
Full credit checks won't be run on eligible borrowers because they have been making their payments, another move that will save costs. In some cases, lenders might call a borrower's employer to see if he or she still has a job, he said.
"We want this program to spread beyond Fannie and Freddie loans," he said "Now, we are talking to lenders about refinancing underwater borrowers on loans the federal government isn't involved in."
by Catherine Reagor and Maria Polletta The Arizona Republic Nov. 11, 2011 12:00 AM
More Arizonans can refinance for underwater mortgages under new plan
Saturday, October 29, 2011
Reagor: Revised program targets underwater homeowners
The housing market is confusing and difficult to navigate for most these days. One month prices are up, the next they are down. The same with foreclosures. In one metro Phoenix neighborhood, there are more short sales than regular sales. In another area less than a mile away, homes are selling for the asking price.
As a real-estate reporter for The Arizona Republic since 1996, I have been watching the market closely for a while. I have owned more than one home in the region. My stomach churns with other homeowners' when prices fall, and I am elated when I see even the slightest positive signs in the housing market. But it all has to be put into perspective.
Starting today, I'll be answering real-estate questions from you, often with the help of experts, at least once a month.
Question: When will the (expanded refinancing) program be available to homeowners? How do you know you are eligible? Also, are the banks being given any incentives to help homeowners who qualify for the program? Right now, it is next to impossible to get anyone from my bank on the phone to talk about my options. -- Carl S.
Answer: Since Monday's announcement by the Obama administration about the expansion of the Home Affordable Refinancing Program, I have heard from dozens of readers who want to know the same thing: Are they eligible?
Homeowners must have a mortgage backed by government-owned Fannie Mae and Freddie Mac. To determine if your mortgage is backed by Fannie or Freddie, call your mortgage servicer or go to makinghomeaffordable.gov, where you can look it up.
Homeowners must be underwater and not have missed more than one payment in the past year. Now, there aren't supposed to be any limits on how much more a homeowner owes on a house compared with what it's worth. This is known as the loan-to-value ratio. Previously, HARP capped the LTV at 125 percent, which is of little help to homeowners in metro Phoenix.
The federal government won't release all details of the program until December. But HUD and Treasury officials said this week that they would cut fees and work on other ways to get lenders to participate quickly. I will continue to follow the program and track its success or failure.
Q: How will I know when new-home prices have hit bottom? I have been looking for a new house in the Gilbert/Chandler area, and it looks like homes now cost half what they did a few years ago. -- Michelle in Tempe
A: Homebuilders are competing with foreclosure homes. They are trying to build and sell houses for the lowest prices they can and still eke out a profit. Housing analysts say it's a great time to buy a new home. In most cases, you don't have to compete with investors paying cash because they are buying foreclosure homes.
Also, the number of new foreclosures is slowing. That means fewer inexpensive homes on the market, which will stabilize prices. The number of homes listed for sale is down, so prices could climb again next year, even in the new-home market.
If you have the cash for a 10 to 20 percent down payment, interest rates are still at new record lows, making it a great time to get a mortgage if you have decent credit. But don't buy unless you plan on holding onto the house for at least a few years, housing advocates warn. No one really knows when the housing market will recover.
by Catherine Reagor The Arizona Republic Oct. 28, 2011 05:12 PM
Reagor: Revised program targets underwater homeowners
As a real-estate reporter for The Arizona Republic since 1996, I have been watching the market closely for a while. I have owned more than one home in the region. My stomach churns with other homeowners' when prices fall, and I am elated when I see even the slightest positive signs in the housing market. But it all has to be put into perspective.
Starting today, I'll be answering real-estate questions from you, often with the help of experts, at least once a month.
Question: When will the (expanded refinancing) program be available to homeowners? How do you know you are eligible? Also, are the banks being given any incentives to help homeowners who qualify for the program? Right now, it is next to impossible to get anyone from my bank on the phone to talk about my options. -- Carl S.
Answer: Since Monday's announcement by the Obama administration about the expansion of the Home Affordable Refinancing Program, I have heard from dozens of readers who want to know the same thing: Are they eligible?
Homeowners must have a mortgage backed by government-owned Fannie Mae and Freddie Mac. To determine if your mortgage is backed by Fannie or Freddie, call your mortgage servicer or go to makinghomeaffordable.gov, where you can look it up.
Homeowners must be underwater and not have missed more than one payment in the past year. Now, there aren't supposed to be any limits on how much more a homeowner owes on a house compared with what it's worth. This is known as the loan-to-value ratio. Previously, HARP capped the LTV at 125 percent, which is of little help to homeowners in metro Phoenix.
The federal government won't release all details of the program until December. But HUD and Treasury officials said this week that they would cut fees and work on other ways to get lenders to participate quickly. I will continue to follow the program and track its success or failure.
Q: How will I know when new-home prices have hit bottom? I have been looking for a new house in the Gilbert/Chandler area, and it looks like homes now cost half what they did a few years ago. -- Michelle in Tempe
A: Homebuilders are competing with foreclosure homes. They are trying to build and sell houses for the lowest prices they can and still eke out a profit. Housing analysts say it's a great time to buy a new home. In most cases, you don't have to compete with investors paying cash because they are buying foreclosure homes.
Also, the number of new foreclosures is slowing. That means fewer inexpensive homes on the market, which will stabilize prices. The number of homes listed for sale is down, so prices could climb again next year, even in the new-home market.
If you have the cash for a 10 to 20 percent down payment, interest rates are still at new record lows, making it a great time to get a mortgage if you have decent credit. But don't buy unless you plan on holding onto the house for at least a few years, housing advocates warn. No one really knows when the housing market will recover.
by Catherine Reagor The Arizona Republic Oct. 28, 2011 05:12 PM
Reagor: Revised program targets underwater homeowners
Tuesday, October 25, 2011
Arizona underwater homeowners to get refinance help
More Arizona homeowners may soon be able to refinance to current low mortgage-interest rates, no matter how far underwater they are in their homes.
The Obama administration on Monday announced long-awaited details of an expansion of a program that helps homeowners refinance to reduce their payments.
Mortgage rates have fallen to record lows, and many homeowners would save hundreds of dollars a month if they could reduce the amount of interest they pay. But the housing crash has created a huge barrier.
A refinanced loan typically requires the home have enough value to cover the entire amount of the new loan. But plunging home values means many owners owe far more on their loans than their homes are worth. An estimated 40 percent of metro Phoenix homeowners are currently underwater.
The federal Home Affordable Refinancing Program has allowed certain loans to be refinanced if the borrower owed up to 125 percent of the home's value. But many underwater borrowers in Arizona owe more.
The plan announced Monday would lift the value requirement completely, allowing some borrowers to refinance no matter how much their home's value has dropped, if their mortgage is backed by one of the two largest federal mortgage agencies and they meet other requirements.
Borrowers can start to apply as soon as December, according to the few details released Monday, and the program would run through the end of 2013.
Speaking on a temporary stage in a Las Vegas neighborhood, Obama touted the plan as a way to allow struggling homeowners to save money.
"Probably the single greatest cause of the financial crisis and this brutal recession has been the housing bubble that burst four years ago," he said. "And as long as this goes on, our recovery can't take off as quickly as it would after a normal recession."
The plan
The HARP program has helped about 900,000 homeowners nationally to refinance. Arizona figures aren't available.
The plan described by Obama and the Federal Housing Finance Agency on Monday would expand HARP by changing the rules and costs associated and extending the time period in which borrowers can apply.
Among the key elements:
- Refinancing will be available to homeowners with loans backed by Fannie Mae or Freddie Mac in 2009 or earlier.
As with the current refinancing program, the option would be open only to borrowers with mortgages backed by the two largest federal mortgage agencies. Borrowers whose banks hold their loans privately would not qualify. Still, federally backed loans make up a majority of the existing mortgages in the state and the country.
The federal government did not give an official count of how many people will be able to refinance, but U.S. Housing and Urban Development head Shaun Donovan estimated 4 million families could be eligible.
Current federal programs have encouraged lenders to refinance such loans or modify loan-payment amounts for borrowers in financial trouble, but the banks that handle the payments in many cases have been slow to respond. Obama said the new program will allow other lenders to compete to make the new loans.
"Some lenders, frankly, just refuse to refinance," he said Monday. "So, these changes are going to encourage other lenders to compete for that business by offering better terms and rates, and eligible homeowners are going to be able to shop around."
The program is designed to help borrowers who took loans before the housing crash, and only applies to loans backed by the federal agencies on or before May 31, 2009.
Market-watchers say the key will be to see whether banks and the mortgage giants actually follow through.
"The new refinancing program sounds like a good idea, but it has to have teeth," said John Smith, president of the Mesa-based non-profit Housing Our Communities, which counsels homeowners on avoiding foreclosure. "The government has to make Fannie and Freddie go through with these deals."
- Refinancing will be available to homeowners who are current on their mortgage payments.
To qualify, homeowners must not have missed more than one payment in the past year.
The plan differs from other programs that were meant to help borrowers who could no longer afford their mortgages. The federal loan-modification program was open only to borrowers who were already late on making their payments.
Instead, the refinancing is open to borrowers who have made their payments.
Although it could help some people who have struggled to make those payments avoid foreclosure, it also could simply help other homeowners free up more money each month.
- Refinancing will be available no matter how much the home is currently worth.
The loan simply must be backed by Fannie or Freddie and be within standard sizes - for example, oversize "jumbo" loans will not qualify.
Borrowers who meet the financial requirements could refinance no matter how much the amount of the loan exceeds the home's current value, known as the loan-to-value ratio.
The previous HARP plan called for a 105 percent loan-to-value ratio, meaning homeowners who owed 5 percent more than their houses were worth could refinance under the plan. That ratio was quickly criticized for helping few in the hardest-hit housing markets of Arizona, California, Nevada, Florida and Michigan. It was raised to 125 percent but still wasn't enough for many homeowners who bought during the past decade in metro Phoenix.
"If the limit is lifted completely, then that will make a big difference for Arizona," said housing analyst Michael Orr, who publishes an online daily analysis of metro Phoenix's housing market called the "Cromford Report." "Many people have a loan-to-value of over 200 percent."
- Refinancing will cost less.
The changes announced Monday would also limit fees associated with refinancing, in hopes of making the move more affordable. Homeowners who qualify don't have to pay additional excessive fees for an appraisal or processing.
Jay Luber, president of Phoenix-based Galaxy Lending, knows many homeowners who will qualify for this program.
He believes it could "accelerate the stabilization of values in metro Phoenix by decreasing foreclosures and short sales."
The doubts
Housing advocates point to past programs that have garnered bad reputations.
The Housing Affordable Modification Program, HAMP, was announced in conjunction with the original refinancing program two years ago.
Tens of thousands of homeowners in Arizona alone were promised loan modifications and put in trial programs. These borrowers made the trial payments for more than a year in some cases only later to be denied a permanent modification.
Overall, the federal housing plan called for helping 7 million to 9 million homeowners. Fewer than 2.5 million have been helped with all of the plan's programs.
Phoenix real-estate agent Kevin Kaufman is skeptical of the new plan.
"I'm honestly very, very pessimistic about any government program actually helping people," he said. "Having been in the trenches for four years now and seen so many empty promises. I don't believe the government will actually help."
Too late?
When Obama unveiled federal efforts to stem foreclosures two years ago, he traveled to Mesa to make the announcement. At the time, foreclosures were surging.
Today, foreclosures have been steadily slowing in metro Phoenix. So the latest move has been criticized as coming too late.
Also, many market observers note that for many homeowners, the real problem is not just their monthly payment but the fact that they will still owe so much more than their houses are worth, making them unable to sell or move.
The Obama administration is hinting about more aid for people who have lost homes to foreclosure and neighborhoods with many empty foreclosure homes.
But this expansion of HARP does help the homeowners who continued to pay as others walked away.
Tom Schroder was turned down for a refinance last year because he owes at least 40 percent more than his Scottsdale home is worth. He said he is angry because he feels like he's being penalized for other people's foreclosures and bad decisions.
"I keep paying my mortgage on time and watching others buy homes at 5 or now even 4 percent (interest rates)," he said. "The changes to the refinancing program sound good. I just want to see some action on it from lenders and fast."
Patricia Garcia Duarte, president of the Phoenix-based non-profit homeownership counseling service Neighborhood Housing Services, said the new refinancing plan rewards homeowners with good credit who have not missed many payments.
"Owing more on a property than it is worth is still problematic for many in Arizona," she said. "Revamping HARP is a good thing, not the entire solution."
by Catherine Reagor The Arizona Republic Oct. 25, 2011 12:00 AM
Arizona underwater homeowners to get refinance help
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