U.S. regulators will let qualified homeowners refinance mortgages regardless of how much their houses have dropped in value, expanding a government effort to chip away at one of the economy's most unyielding problems.

The Federal Housing Finance Agency will also enhance the Home Affordable Refinance Program by eliminating some fees, reducing others and waiving some risk for lenders, Edward J. DeMarco, the agency's acting director, said today.

HARP, which was introduced in 2009 to help homeowners get lower interest rates, was initially limited to borrowers whose mortgages were no greater than 125 percent of the value of their homes. To qualify, borrowers must be making on-time payments on loans owned or guaranteed by Fannie Mae or Freddie Mac, the mortgage-finance firms taken into U.S. conservatorship in 2008.

"We believe these changes will make it easier for more people to refinance their mortgage," DeMarco said. "This is not a mass-refinance program."

The program applies to borrowers whose existing loans were issued before June 2009. Borrowers must have made on-time payments for the last six months and report not more than one late payment in the past year. Mortgages must be worth at least 80 percent of a property's value to be refinanced. The program expires at the end of 2013.

President Barack Obama will promote the new rules today during a visit to Nevada, which has the highest foreclosure rate in the U.S. Falling home prices continue to dog the broader economy by eroding wealth, stifling spending and triggering foreclosures. About 11 million borrowers are underwater, meaning they owe more than their homes are worth.