Sens. Robert Menendez, D-N.J., and Barbara Boxer, D-Calif., have introduced a revised version of the Responsible Homeowner Refinancing Act.
The bill allows borrowers with more than 20% equity in their homes and who do not have an underwater mortgage to participate in the Home Affordable Refinance Program (HARP). As part of the revision, the bill no longer allows borrowers to participate in HARP if their loans were sold to Fannie Mae or Freddie Mac through May 31, 2010. The revised bill also removes penalties against lenders holding second mortgages and mortgage insurance companies that block a refinancing.
‘This bill is a win-win-win: homeowners will have more money in their pockets, Fannie and Freddie will see fewer foreclosures, and the housing market and economy will be strengthened,’ says Boxer. ‘That's why the Menendez-Boxer bill has such broad support from industry and consumer groups.’
The bill has the support of industry groups including the Mortgage Bankers Association, National Association of Realtors, National Association of Home Builders and the Center for Responsible Lending. However, it failed to advance in the Senate after it was introduced in May.