WASHINGTON - The Obama administration announced Monday that borrowers with little or no equity in their homes will have another year to take advantage of a refinancing program that so far has made little progress.
The Home Affordable Refinance Program was set to expire in June, but so far it has reached fewer than 200,000 of the up to 5 million borrowers federal regulators hoped it would help.
Market conditions have not changed significantly since the program was launched last year, Edward DeMarco, acting director of the Federal Housing Finance Agency, said in a statement. So, to give lenders more time to implement the plan and to "support and promote market stability," the initiative will be extended to June 2011, he said.
The program is aimed at the millions of borrowers whose home values have been diminished by a weak housing market, or who owe more than their houses are worth, making it impossible for them to take advantage of historically low mortgage rates.
But the program ran into several problems. Many borrowers were too deep in debt to qualify, and the program was limited to loans backed by Fannie Mae or Freddie Mac, the federal mortgage financing companies.