HARP revamp details released

The federal government recently released more details of the revamped Home Affordable Refinance Program to help struggling homeowners remain current on their loans and take advantage of low interest rates to avoid foreclosure.

The Chicago Tribune reported the reworked effort will aim to assist homeowners with mortgages backed by Fannie Mae and Freddie Mac. To qualify for the program, borrowers must have 20 percent or less equity in their homes and loans that originated before May 31, 2009.

The source reported homeowners cannot qualify for the program if they have any delinquencies in the past six months, but a borrower can be 30 days late on one payment in the last six months of the past year.

Another major change to the program is the put-back risk - the possibility that the lender will have to repurchase the loan from Fannie Mae or Freddie Mac because the underwriting process violated the government-sponsored entities' guidelines, MarketWatch reported. Therefore, if there are fewer lender appraisals of loans, borrowers will have less charges and the program will be more cost-effective.

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