The HARP loan program was founded in 2009 to help make homes more affordable. The US economy was in financial crisis then and the confidence of consumers was low—big banks had just failed and the values of homes were dwindling. In addition, consumer spending was low and job growth wasn’t making any headway. The economy was declining and the Making Home Affordable program was put in place to slow down this fall and reverse it using two elements. This program was intended to help homeowners who couldn’t meet their mortgage payments to keep their homes. The government believed that fewer foreclosures would help steady housing and home values.
According to the National Mortgage News; Lenders refinanced over 1 million borrowers with high LTV loans via the HARP program in 2012 and they could do the same in 2013 and 2014, according to MBS strategists at Bank of America Merrill Lynch.