This program is a true refinance program that is available to consumers through Fannie Mae and Freddie Mac lenders. If your current mortgage is a Fannie Mae or Freddie Mac mortgage and you've lost equity in your home, you can refinance. It's very difficult if your current conventional loan has PMI, even though PMI companies are willing to reissue the PMI certificates. It used to be difficult to do these if there was a second mortgage behind the Fannie/Freddie first mortgage, but not anymore.
You do not need to go through your existing servicer. In fact, I've found that most consumer experiences with a HARP refinance are worse when they go through their current lender AND they charge more. I think that the big banks charge more because they know most homeowners are going to go through them and they can get away with charging more, which is sad.
The key is you need to find a good lender who has experience doing HARP refinances in your area. Again, it does not need to be your current lender. Shop the loan like you would any other refinance but don't just shop price. Shop expertise, knowledge and capacity. Not every lender is going to the limits of HARP guidelines. They may practice a more conservative approach, which isn't uncommon.
I wrote a blog post that I update regularly with new changes on this program. I can't assist you because I only do loans in WA, CA and AZ but the principals here apply to you and will get you on the right path to getting this loan through if you qualify.
Feel free to either ask me any questions you may have on this thread or on the comments section of that blog.
The government web site for the various programs is http://www.makinghomeaffordable.gov/ It's possible a HUD-approved housing counselor may be able to help. From the government's web site:
A HUD-approved housing counselor will talk to you about your situation and help you decide what mortgage options are best for you. A counselor will explain what documents you will need to provide to your mortgage company and may be able to contact the mortgage company on your behalf.
If your daughter is delinquent on her mortgage, here's the number to call: 888-995-HOPE (4673)
Hope that helps.
A housing counselor can also help you make a budget so that you can meet your monthly mortgage payment and other expenses. The counselor will have information about local resources that may be helpful to you.
There is no charge to work with a HUD-approved counseling agency.
HUD sponsors housing counseling agencies throughout the country that can provide advice on buying a home, renting, defaults, foreclosures, credit issues, and reverse mortgages.
Here's a link to finding a HUD-approved counselor: http://www.hud.gov/offices/hsg/sfh/hcc/fc/