A government program that helps struggling homeowners take advantage of low interest rates to cut monthly mortgage payments is providing an unexpected revenue boost to large banks such as Wells Fargo & Co. and JPMorgan Chase & Co., the Wall Street Journal reported today. Banks that collect those payments could get as much as $12 billion in revenue this year refinancing mortgages under the federal Home Affordable Refinance Program (HARP), according to data compiled by Nomura Holdings Inc. Borrowers who refinance mortgages through HARP, on the other hand, stand to save between $2.5 billion and $5 billion this year, according to an analysis by the Wall Street Journal of Nomura's figures. Federal officials last year revised the HARP program in a bid to encourage banks to refinance borrowers who were underwater on their mortgage. The revisions have driven a sharp increase in refinancings, following years in which the program fell short of government projections. But some critics, including members of the Obama administration, say that the changes risk making HARP a giveaway to big banks.
