Expanded refinance proposal gaining momentum

A proposal to help more homeowners refinance their mortgage into today’s low rates with any lender they choose is gathering new support, providing a lift to what had been considered a stalled proposal, The Wall Street Journal reports.

Senators could vote as early as this week on an expansion of the Home Affordable Refinancing Program. Under the proposal, homeowners would be able to refinance their mortgages with any lender through a government program. This would allow borrowers to shop for the best mortgage rate rather than be limited to who they already had as a lender.

The proposal also would potentially lower the cost of refinancing by removing certain fees that Freddie Mac and Fannie Mae charge.
The bill had been introduced earlier this year but has yet to gain any ground. The Federal Housing Finance Agency had criticized the need for any changes to the refinancing program.

Critics have argued that more than a half million homeowners have already refinanced under the government’s programs, so any changes to the program were not needed.