Federal Housing Finance Agency Director Mel Watt is focusing additional effort on capturing the significant proportion of eligible HARP refinances left. However, according to Compass Point Research & Trading, Watt might have more time to accomplish this feat.
Watt, along with housing experts and community leaders, will meet in a town hall-style meeting at the Woodson Regional Library in Chicago on July 8 to discuss the benefits of HARP and encourage the approximately 36,000 Chicago residents still eligible to participate in the program.
“We believe there is a high likelihood that Director Watt will use this forum to announce an extension of the HARP from December 2015 to December 2016,” the company report said.
At the end of June, U.S. Treasury Secretary Jacob Lew announced several initiatives designed to spur the flailing housing market, including the extension of the Making Home Affordable program until at least Dec. 31, 2016.
“These new actions will help provide more affordable options for renters, assist homeowners facing foreclosure or juggling bills to pay their mortgages and expand access to credit for prospective borrowers,” Lew said.
As a result, Compass Point said it believes that the FHFA will align the HARP expiration with the HAMP expiration just as they did in 2013 when the programs were extended last.
But despite this being a small win for special servicers and some originators, the extension is not likely to put a dent in the market’s broader refinancing burnout.