The government is revising and extending the HARP Program (Home Affordability Refinance Program) in the hopes of helping 1.6 million underwater homeowners refinance their mortgages.

Program Summary:

With new guidelines, Moody's economist, Mark Zandi,  expects 1.6 borrows will be able to refinance by the time the program expires in Dec, 2013.

Program applies to all loans backed by Fannie Mae or Freddie Mac 

Program will include those owing more than 125% of their home's value.

Appraisal and underwriting requirements are to be reduced

Loan fees will drop and waived for borrowers who reduce their loan term

Borrowers must be current on their previous six mortgage payments and have a job or a source of passive income.

Lenders can avoid buying back bad loans from Fannie or Freddie if they lend to borrowers who are current on their last six mortgage payments and have a job or passive source of income. 

Program lending should start by Dec 1, 2011.

For more information, read: Home Lending Revamp Planned - http://on.wsj.com/u1sGPz