Pelley Law Office LLP
Dallas Office
Plano Office
Sherman Office

No Charge For Initial Consultation ($250 value)

Menu Contact

Over 80 Years Of Combined Experience

View Our Practice Areas

HARP refinancing: Freddie Mac erected barriers

According to new information recently disclosed by Freddie Mac officials, the mortgage company intentionally made it harder for Americans to refinance high interest mortgages because of its bottom line. In other words, they intentionally kept Americans locked in their high interest mortgages by creating barriers to HARP (Home Affordable Refinance Program) refinancing.

Had Freddie Mac and Fannie Mae agreed to a better refinance program, they could have helped nine million more homeowners save around $75 billion.

Instead, Freddie Mac was afraid that refinancing would lead to higher default rates (which has been proven wrong), and there is even evidence that the company created barriers because it viewed HARP as a stimulus program.

Some of the barriers erected after the bailout included:

  • Borrowers with a loan-to-value ratio of less than 80 were not eligible for HARP
  • Homeowners had to reappraise their homes before being considered for HARP
  • Borrowers had additional restrictions if they desired refinancing through a new bank

Now, Freddie Mac has a new CEO who has lifted some of the barriers and is allowing more HARP refinancing.

There are many editorials about whether HARP was successful, but the bottom line is that many homeowners have faced more debt than they would have had Freddie Mac provided more help through HARP.

Of course, refinancing is not an option for everyone. HARP benefits are only available for mortgage loans that involved either Fannie Mae or Freddie Mac. Furthermore, refinancing cannot provide full financial relief for families suffering from significant debt. An experienced bankruptcy lawyer can help you understand all of your options.

Source: ProPublica, "Freddie Mac made it harder for homeowners to refinance because it hurt their profits, might help Obama," Jessie Eisinger, Oct. 25, 2012

No Comments

Leave a comment
Comment Information

Awards & Recognition

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Office Locations

Plano office
Sherman office
Dallas office

Plano Office
1312 14th Street, Suite 100
Plano, Texas 75074

Phone: 972-608-0335
Map & Directions

Sherman Office
905 North Travis Street
Sherman, Texas 75090

Phone: 903-813-4778
Map & Directions

Dallas Office
100 Crescent Court
Suite 700
Dallas, Texas 75201

Phone: 214-733-1775
Map & Directions