Responsible Homeowner Refinancing Act of 2013

by Caroline in Phoenix, Arizona USA

Ask Kate about Responsible Homeowner Refinancing Act of 2013: Introducing the latest HARP 3 refinance proposal by Senators Robert Menendez of New Jersey and Barbara Boxer of California! The current HARP 2.0 program isn't cutting it. But if more borrowers could lower their mortgage rates and find relief in affordable monthly payments, our nationwide economy would benefit. But I still have a beef with this February 2013 plan!


Before you read Caroline's letter which inspired my review of this bill, here is how to contact elected politicians in the White House, Congress, and your state government.

Caroline asks Kate about HARP 3.0 Cut-Off Date for Past Refinance

Hi Kate, I love your site and have it saved in my favorites.

Responsible Homeowner Refinancing Act of February 2013 - HARP 3 Proposal
We do not qualify for HARP programs in place thus far. We refinanced after the cutoff date of May 31, 2009 with Wells Fargo that they of the low doc, no cost deals.

It did not even lower our interest rate all that much!

We are presently at 4.8%. Tried looking at conventional refinance and it was a no-go due to the 80/20 ratio thing, and that most likely our appraisal would not come in high enough.

Would there be a date limit on the HARP 3.0 that is still being decided on?

We satisfy all the requirements for HARP 2.0 - except that we did that refi in 2010. Just hoping we may qualify for 3.0 if it ever passes.

We probably could short sale - my husband has a new job and makes considerably less when we first moved to this house in 2007.

One last thing...we put down 150K to get into this house. Sales price $530K with 150K down. Our mortgage is now $355K. Appraisal would be really pushing it - may appraise at like $325-335. Your thoughts are really appreciated. What would you do? Sorry for the really long message. Thanks!
May 2013 Breaking News! The Obama Administration is rumored to be considering an extended HARP eligibility date of mid 2010 which will allow more homeowners to participate in the refinancing program. Further details in the comment section below.

Kate Answers: February 2013 HARP 3 Proposal

***zz-portrait-left.shtml*** Hi Caroline,

Don't apologize! I appreciate the details. Let's take a look at the latest HARP 3 proposal.

It's the Responsible Homeowner Refinancing Act of February 2013 by US Senators Robert Menendez of New Jersey and Barbara Boxer of California.

This newest proposal to improve the HARP 2.0 plan has 6 main points.

Benefits to HARP 3 Responsible Homeowner Refinancing Act of 2013

1. Opens up refinancing opportunities to all Fannie and Freddie borrowers, underwater or not.
2. Lowers up-front refinance fees.
3. Eliminates the cost of appraisals.
4. Removes additional barriers to competition.
5. Eliminates employment and income verification requirements.
6. Extends the HARP program through 2014 to allow more time for refinancing.

It is estimated that 12 million homeowners could participate in the Making Home Affordable Refinance Program based on this proposal.

But here's my beef! Millions of homeowners with mortgages not backed by Fannie Mae or Freddie Mac won't be able to participate. Additionally, the bill does not address the limiting cut-off date of May 31, 2009. More on its limitations in a moment. Here are the details.

Responsible Homeowner Refinancing Act of 2013 - HARP 3 Refinance

1. Consistent refinancing opportunities: To participate in HARP 2.0, a homeowner must have less than 20.01% equity. This puts up a barrier for homeowners who have been paying down their loan balances. This proposal could remove this restriction.

2. Lower refinance fees: Currently, homeowners with more than 20% equity (less risk) are paying higher loan fees than participants in HARP 2.0 (greater risk). This bill will restrict Fannie and Freddie from charging up-front fees to refinance a mortgage they already guarantee.

3. Appraisal fees eliminated: Too many HARP borrowers are still paying for appraisals due to a lack of comparable sales in their areas. This bill requires viable streamlined alternatives to manual appraisals.

4. Additional barriers to competition removed: Less restrictions on new servicers vs current lenders will open the field for competition, lowering borrowers' cost of refinancing. This is aimed at reducing the fear among lenders that they'll be forced to buy back loans after selling them to Fannie or Freddie.

5. Employment and income verification not necessary: This will improve on the HARP 2 September 2012 enhancement which you can read about at HARP 2 No Income Verifier Refinance. As long as a homeowner is making their monthly house payments, income and employment data will not be a qualifying factor.

6. Extension through 2014: The Making Home Affordable Refinance Program is set to expire December 31, 2013. If extended for another year, it will allow more time for refinancing.

Drawbacks to Responsible Homeowner Refinancing Act of 2013

1. Mortgages not securitized by Fannie Mae or Freddie Mac would not be eligible.
See Does Fannie or Freddie Own My Mortgage for more information.

2. The securitization cut-off date of May 31, 2009 does not change.
See HARP 2 Eligibility for more information.

3. The restriction of one HARP loan refinance per property is not addressed.
See January 2013 HARP 3 Petition for more information.

4. Does not face up to the struggles of refinancing with lender paid mortgage insurance (LPMI).
See HARP Refinancing with LPMI for more information.

How You Can Make HARP 3 Refinance a Reality

This proposal remains incomplete. It must eliminate the restriction of being backed by Fannie Mae and Freddie Mac, address the cut-off date barrier, the inability to re-HARP, and lenders' attitudes toward lender paid mortgage insurance (LPMI).

Until it does, it remains a rehash of the existing HARP 2.0. program.

Do you agree? Congress will never know if you don't snail-mail, email, text, Twitter, and Facebook the members. Remember, they are elected. By you. It's time they hear how you feel!

When you write, feel free to link to this page in your letter:

Best wishes,



Ask Kate about Your Mortgage

Anyone can ask Kate a question or add a comment. (To comment, look for the link at the bottom of this page.)

Have You Seen Recent Ask Kate Answers

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Comments for Responsible Homeowner Refinancing Act of 2013.

Click here to add your own comment.

Harp 3 Time Table
by: John H from Rancho Mirage, CA 92270

Dear Kate,

Can you please tell me where this 2013 bill stands? Does it have any chance to pass? Thank You very much, John

Hi John, Kate here...

The HARP 3 proposal is held tightly in the hands of your elected politicians. Unless each one of us takes a few minutes to write Congress and the President to make our wishes known, I can see it dragging on and on according to the whims of Washington DC.

Go here for a quick way to write the government!

Best wishes, Kate

Closed May 2009 But Sold to Fannie Mae August 2009
by: BB in Antioch, IL

Hi Kate!...BB here...We are in a pickle and need some advice. Correct me if I am wrong...The reasoning for the cutoff date of June 1, 2009 was that the homeowner should have known better then to refinance after that date, as interest rates were telling.

Well, we did refinance within the above date, AND closed on the loan BEFORE the cutoff date...This should have made us eligible...Right?

But because Bank of America sold to Fannie on August 1, 2009, we do not qualify for HARP...We feel slighted, as HARP rules seem to not make good on their reasoning. Any advice other then going to someone who just says 'rules are rules'? Or are we stuck?

Thanks BB.

P.S. Writing Congress has done no good.

Hi BB, Kate here...

I'm disgusted by the hypocrisy of the government owned entities (GSEs). The HARP cut-off date claims that homeowners should have possessed more insight into the market than the government, Fannie Mae, and Freddie Mac.

Rules are rules until we change them. Will one letter to Congress make a difference? Probably not. But a flood of letters from struggling and underwater homeowners who tell their story and present a HARP 3 wish list will!

It only takes a few minutes to write.

Please keep writing, Kate

We Can Make a Difference
by: Marlene

As for the HARP question and answer, again thank you. I have been very proactive in that issue. I hope everybody else has been taking a lead on that too, together with the wonderful professional advises that you have been providing, we can make a difference.

For the past couple of years, I have contacted every elected official in my district. Just Friday May 10, 2013, I faxed a letter to the WhiteHouse about the HARP securitization date dilemma versus closing date.

Hi Marlene, Kate here...

You are a great encouragement! I agree! Together, we can make a difference.

Best wishes, Kate

Rumors of Extending HARP Eligibility Date to May 2010
by: Marlene from Colchester, CT

Hi Kate,

You may have heard the rumors regarding a new possibility of extending HARP eligibility date for loans closed on or before May 2010. My loan was closed in May 2010. But, although I selected Fannie Mae during the application process, which preceded the closing of May 10, 2010, Fannie Mae's website documented a securitization date of July 17, 2010.

My question: If this becomes a reality, will they consider the closing date or the securitization date? Will I (again) be penalized for their internal lapse in completing their paperwork?

Another thing, at the time I originated my mortgage, I was advised to separate the loan with a 10% secondary mortgage with my mortgage company at a rate of 7% and 80% with Fannie Mae. Will that 10% taken at the same time be excluded from HARP refinancing?

Thank you in advance for your time, Marlene

Hi Marlene, Kate here... Thank you for reporting on this news!

The White House is rumored to be saying that it wants to change the eligibility date of the HARP refinance program, allowing more homeowners to take advantage of the underwater refinance program.

It sounds like the eligibility date would get pushed from June 2009 to the middle of 2010. I assume this refers to the securitization date by Fannie Mae or Freddie Mac and not the closing date.

Sadly, I would also assume that your HARP eligibility will continue to be subject to Fannie's and Freddie's internal lapse in completing their paperwork, as you so succinctly described.

But this is just my assumption and until HARP 3 is out of the proposal stage, we are guessing at best. Again, thank you for writing me about this, Marlene!

Sincerely, Kate

P.S. Sorry Marlene, I missed your last question when I posted this a couple of days ago.

The HARP 2 version of the Making Home Affordable Refinance Program is limited to 1st mortgages only. I have not read that HARP 3 will include 2nd mortgages.

This is exactly why homeowners must write their politicians NOW before the program is finalized. Send Washington DC your wishlist!

Securitization date for loans owned by Fannie Mae
by: Marlene from Colchester, CT

Hi Kate, I am far from being a mathematician or statistician. But it's hard for me to understand the financial gain to the economy from FHFA's recent streamline decision rather than eliminating the 2009 cut off to allow more responsible underwater homeowner to benefit from a lower interest rate and lower monthly payments through HARP participation. Am I missing something?

Hi Marlene, Kate here...

Nope, you aren't missing anything! Please write your reps in Congress, including the President about eliminating the qualifying date. Also your state-level elected representatives. Here's an easy way.

Best wishes, Kate

HARP 3.0
by: Anonymous

Hi! My understanding of HARP 3.0 is that it is supposed to help homeowners whose mortgages are not backed by Fannie Mae and Freddie Mac. Are you saying HARP 3.0 is for Fannie Mae and Freddie Mac backed mortgages?

Is there a link I can read this as evidence?


Hi, Kate here.

There are several HARP 3 proposals. But the latest HARP 3 proposal, The Responsible Homeowner Refinancing Act of 2012, shockingly included only Fannie and Freddie backed mortgages.
The Responsible Homeowner Refinancing Act of 2012 removes the barriers preventing these Fannie Mae and Freddie Mac borrowers from refinancing their loans.
Read the proposal on the official website of US Senator Barbara Boxer (CA) at

Best wishes,

Downfall on Home Refinancing
by: Anonymous

It will be a sad day if the president signs this bill, since he was the one that said he would open it up to all. He will be a very stupid man if he does.

HARP Issues from Licensed Loan Officer
by: Dan Chapman

HI Kate, I have been in the Mortgage business for 13 years and I agree with your comments on HARP. The current program is way too restrictive.

Many borrowers do not even qualify, I would say about 5% of homeowners out there qualify for the current program. Additionally the lenders are putting too many overlays/restrictions because they are afraid Fannie Mae or Freddie Mac might make them buy back the loan.

Also the fact that once you have refinanced on the HARP program they will not let you do it again and I have several clients who would love to do it again and lower their rate. They need to remove this restriction as well as allow borrowers whose last loan was closed after the date of June 1, 2009 to be able to refinance on this program too.

If the government really wants to improve the housing market and US. economy and put more cash in responsible homeowners pockets they need to fix the HARP Program and make it much less restrictive. HARP 3.0 will help but it does not fix all these issues.

All the best,
Dan Chapman
Loan Originator
Santa Clarita, California

HARP 3.0 for Bank Of America Mortgages
by: Carrie

Kate, Fannie & Freddie did not participate in the Mortgage settlement which helped thousands of homeowners who are underwater refinance or modify their loans to reduce principal.

Will the Harp 3.0 for Fannie Mae backed loans serviced by Bank Of America qualify for this refi and if so when is it available for us to apply?

My family and I are 50% underwater & have not been able to receive any help.

Hi Carrie, Kate here...

I've never read in the proposals that mortgages serviced by Bank of America would be excluded. In fact, the plans specifically propose to include Fannie Mae and Freddie Mac backed mortgages.

So hopefully when the details are finalized, your mortgage will be included.

There is no timeline for release yet but when there is, you'll read about it first at my Knock Your Socks Off Best Mortgage Rate Blog. Bookmark it so you can easily return!

Best wishes, Kate

Could current version of HARP 3.0 help us?
by: Bob C from Laveen, AZ

My wife has a 7% 2005 no-doc loan, with no late payments to date. The mortgage is underwater by perhaps $50k. She only has a part-time job but a better than good credit rating (720).

I am not on the original mortgage. I filed for bankruptcy in 2008 AND I have just completed an Offer in Compromise with the IRS and liens are being removed. Needless to say, my credit rating isn't as good.

With all this baggage, is it possible (based on current thinking) that HARP 3.0 can help us?

Hi Bob, Kate here... Well, we're guessing here because individual politicians are making the proposals. Yet we're safe to assume Congress will show no mercy when tweaking the final plan.

But as it stands now, HARP decisions are credit based (as opposed to HAMP loan modifications). The most important factor considered is timely mortgage payments.

Since your wife has a pristine mortgage payment history, apply as soon as HARP 3 is released! I'd encourage other homeowners to apply also. The worst that can happen is a denial. See How to Cure Mortgage Approval Hiccups for help with loan denials.

In the meanwhile do not forget about modifying your mortgage with HAMP if your monthly house payment becomes unaffordable.

Best wishes, Kate

P.S. Congratulations on your approved Offer in Compromise with the IRS and lien releases. Store the paperwork in a safe place!

HARP 3 Question
by: Dan from Maple Grove, MN

I missed the June 1, 2009 cutoff by a few weeks, otherwise I would've taken advantage of HARP a long time ago. We bought our current house in 2005 and subsequently lost all of the equity we had earned on our previous house, we then refinanced in June of 2009 at 4.75%. Why hasn't this date been updated in previous HARP revisions?

From what I've seen in other blogs, changing the cutoff to June 1, 2010 could be a part of HARP 3. What is the status of HARP 3? Eagerly awaiting the passing of HARP 3 & the change of the cutoff date to June 1, 2010!! Thanks for your response! Dan

Hi Dan, Kate here...

I believe you will find your answers in my above summary of Responsible Homeowner Refinancing Act of 2013, the latest HARP 3 proposal by Senators Robert Menendez of New Jersey and Barbara Boxer of California.

Please read the entire page and then take action. It's time for proposal after proposal to quit hitting the mark! US homeowners deserve better than this!

Best wishes, Kate

Cut Off Date for HARP Loans
by: Tom from Salt Lake City, Utah

Is the new #MyRefi program going to accept mortgages that were taken over by Freddie or Fannie after May 31, 2009 ?

Hi Tom, Kate here...

This is not addressed in President Obama's New HARP 3 Refinance Proposal neither in the latest HARP 3 refinance proposal by Senators Robert Menendez of New Jersey and Barbara Boxer of California.

So let's make a difference. Learn how in my answer to Caroline's question. (see above)

Best wishes, Kate

Harp 3 Program
by: Ray A. from Visalia, Calif

Do you have any timeline on when this will pass.

Waiting patiently,
Thank you.

Hi Ray, Kate here...

Not only is there not a predictable timeline, the proposal is not sufficient.

But there's hope! Please see what you can do to make HARP 3 a reality in the above letter.

Best wishes, Kate

Any HARP 3 News
by: Underwater Homeowner

Kate, Any news on government helping with mortgages not backed by Fannie or Freddie?

Hi Kate here...

Good timing with your question. Today's HARP 3 news is not promising. But you can help turn this around. Please see above letter.

Best wishes, Kate

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