The number of applications for refinance has grown significantly since the introduction of the new and revised HARP 2 Requirements. Since the new guidelines for the Home Affordable Refinance Program were introduced in March, there has been a drastic increase in the number of homeowners looking to refinance their mortgages to lower rates. According to White House figures, refinance applications are up 50 percent from last fall, with about one third of those coming for HARP qualified borrowers.

Reports released by the Department of Housing and Urban Development indicate mortgage lenders are handling about a half million applications, compared to the total of 1 million mortgages refinanced through the HARP program since it’s launch in spring of 2009. With an expected average savings of $2,500 per year, borrowers are lining up to reduce their monthly payments and interest rate.

The largest increase in applications has unexpectedly come from the states with the highest number of underwater homeowners. Refinances in Nevada, where 61 percent of borrowers are underwater, are up 267 percent. Similarly, in Arizona, where about half of all borrowers are underwater, refinance applications are up 181 percent. Many other states in similar situations are experiencing the same uptick in refinance applications; underwater homeowners are trying to refinance their mortgages in states like Florida and Michigan where the collapse of the market had a much greater effect.

The new, eased rules have enabled many homeowners to qualify for refinancing. The new restrictions remove the loan to value caps, allowing borrowers to refinance no matter how underwater they are. The requirement of a new appraisal has also been eliminating, reducing the costs of refinancing. Although these changes were made last fall, most lenders did not implement the new guidelines until March.

Although the HARP program is aimed to help underwater homeowners, homeowners with low equity, about 20 percent of their home value, can utilize the program as well. The program is currently limited to borrowers with loans backed by Fannie Mae or Freddie Mac, although the Obama administration is asking congress to open the program to a larger pool of borrowers. Be sure to find more information, and see if you qualify for a HARP Refinance.