NEW YORK ( TheStreet) -- The government's Home Affordable Refinance Program (HARP) has helped a little over 2 million borrowers refinance their mortgages at lower rates, the Federal Housing Finance Agency said Tuesday.

Between January and November 2012, nearly 1 million borrowers refinanced their loans through the program, more than in any single year since the program's inception, on the back of record low interest rates and changes that made it easier for underwater borrowers to access refinancing.

HARP was established in 2009 to help borrowers with mortgages backed by Fannie Mae and Freddie Mac an opportunity to refinance their loans. But the program failed to help many borrowers who owed significantly more than their homes were worth.

In October 2011, the program was expanded, allowing even deeply underwater borrowers to refinance by removing a 125% cap on loan-to-value limits. Harp 2.0, as it's dubbed, also eliminated certain risk-based fees for those who refinanced into shorter-term loans and waived representation and warranties that lenders commit to in making loans owned or guaranteed by the agencies.

The enhanced program was far more successful. From January through November 2012, 998,294 refinances were completed through HARP.

In November alone, nearly 130,000 borrowers refinanced their mortgages, representing 23% of total monthly refinance volume. Notably underwater borrowers appear to be taking the most advantage of HARP.

About a quarter of the November refinances included mortgages with a loan-to-value greater than 125%, while about 46% had a loan-to-value ratio of more than 105%.

In November, HARP refinances represented 68% of those in Nevada and more than 56% of those in Arizona, where most borrowers still owe more than their homes are worth.

Underwater borrowers are refinancing into shorter term 15- and 20-year mortgages that helps them pay off their principal faster, thereby building more equity in their homes.

HARP is due to expire at the end of 2013. However, a new bill has been introduced in Congress to extend HARP by an additional year to 2014 and also ease the process further by eliminating appraisal costs, reducing upfront fees and ensuring consistent standards for all lenders. Read more on that plan here.

President Obama is also still pushing for a universal refinancing plan that would allow borrowers with non-government-backed mortgages to refinance via the Federal Housing Administration.

Analysts, however, doubt either of those plans will win approval in the Republican-controlled House.

-- Written by Shanthi Bharatwaj in New York

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