ERATE Insightful
     Best Mortgage Rates Source for over 15 Years

Real Estate Market

One-in-three Fannie, Freddie refis are HARP loans, as high loan-to-value HARP loans comprise large share of hard-hit states' refis

by Broderick Perkins
DeadlineNews.Com

(8/17/2012) - Homeowners shot down in a previous attempt to land a HARP refinance, have more to gain than to lose by trying for a HARP loan again.

In May this year, loans written under the Home Affordable Refinance Program (HARP) had jumped to 20 percent of all Fannie Mae and Freddie Mac Refinanced mortgages, the largest share since the Feds launched the program back in 2009.

A month later, the share zoomed to 33 percent, another new high, according to the newest Federal Housing Finance Agency's "Refinance Report June 2012".

Through June 2012, Fannie Mae and Freddie Mac refinanced 422,969 loans through HARP, more than all the 400,024 HARP refinances last year.

Record-low level mortgage interest rates, for sure, are contributing to the run on HARP loans.

However, Lender Processing Services says a HARP enhancement earlier this year gets just as much credit for prompting more homeowners to attempt a HARP refinance.

Under the original HARP, homeowners with Fannie Mae or Freddie Mac loans were ineligible if their existing mortgages exceeded 125 percent of their home¹s value. That bumped many homeowners in hard-hit states, Arizona, California, Florida, Michigan, Nevada and others, where loan-to-value (LTV) ratios submerged far underwater - some as deep as 200 percent.

Under the new and improved HARP 2.0 there's no LTV ceiling - it doesn¹t matter how far underwater a homeowner has become, provided the lender will bite. Apparently it's been a boon for homeowners in hard-hit states.

Higher loan-to-value impact

HARP refinances for loans with LTV greater than 125 percent surged in June to more than 40 percent of HARP volume as lenders began to sell Fannie Mae and Freddie Mac securities containing these loans June 1, FHFA reported.

More than 66 percent of borrowers in states hard hit by the housing downturn ­ Nevada, Arizona and Florida ­ refinanced through HARP in June, compared with 33 percent nationwide.

In Nevada, Arizona and Florida, underwater borrowers (with LTV greater than 105 percent) represented more than 80 percent of HARP volume in June, FHFA reported.

However, the new loan does have to be a fixed rate mortgage (FRM). For eligibility, the minimum LTV ratio on the old loan remains at 80 percent. While there is no LTV ceiling on a new FRM loan, if the new loan is an adjustable rate mortgage (ARM) the new loan can have no more than a 105 percent LTV.

"For this month's Mortgage Monitor, we looked at Fannie Mae and Freddie Mac 30-year fixed-rate loans across a variety of loan-to-value ratios," explained Herb Blecher, senior vice president of LPS Applied Analytics.

"Since the beginning of this year, high loan-to-value refinances have increased significantly. As an example, 2006 vintage GSE (Government Sponsored Enterprise, Freddie Mac and Fannie Mae) loans with six percent interest rates and LTV ratios between 100 and 125 percent increased from a 10 percent annualized prepayment rate at the end of 2011 to more than 40 percent in June 2012. Our data also show that this rise in loan activity extends beyond that subsection ­ the same type of increase holds true across other vintages with the same characteristics," Blecher added.

 

Follow the link to continue reading the related articles

CFPB: Consumers complain about mortgages more than any other financial service tracked

Space agency credit union offers down-to-earth, federally-insured, low- and no-down home loans targeting a limited audience, for a limited time

HARP loans jump to 20 percent of Fannie, Freddie refis; 2012 HARP refis already exceed 2011 HARP refis

Mortgage modification savings help create better borrowers

FHA back pedals on credit dispute underwriting rule, perhaps only temporarily

Power of counseling saves struggling homeowners $175 a month

 

 

 

 

 

 

 



    Fannie Mae & Jumbo Mortgage Rates
    Just One Click!
= Current Rate Chart
Pennsylvania Mortgage Rates Current Mortgage Rates - Hawaii Current Mortgage Rates - Alaska West Virginia Mortgage Rates Virginia Mortgage Rates District of Columbia Mortgage Rates Maryland Mortgage Rates Delaware Mortgage Rates New Jersey Mortgage Rates Connecticut Mortgage Rates Rhode Island Mortgage Rates Massachussetts Mortgage Rates New Hampshire Mortgage Rates Vermont Mortgage Rates New Hampshire Mortgage Rates Maine Current Mortgage Rates Vermont Mortgage Rates Current Mortgage Rates - New York Current Mortgage Rates - Michigan Current Interest Rates - Wisconsin Current Mortgage Rates - MINNESOTA Ohio Mortgage Rates Current Mortgage Rates - Kentucky Current Mortgage Rates - Indiana Illinois - Current Mortgage Rates Current Mortgage Rates - Iowa Missouri Mortgage Rates Current Mortgage Rates - North Carolina South Carolina Mortgage Rates Current Mortgage Rates - Florida Current Mortgage Rates - Georgia Current Mortgage Rates - Tennessee Current Mortgage Rates - Alabama Current Mortgage Rates - Mississippi Current Mortgage Rates - Louisiana Current Mortgage Rates - Arkansas Current Mortgage Rates - Oklahoma Current Mortgage Rates - TEXAS Current Mortgage Rates - New Mexico Current Mortgage Rates - Arizona Current Mortgage Rates - Kansas Current Mortgage Rates - Nebraska Current Mortgage Rates - Colorado Current Mortgage Rates - Wyoming South Dakota Mortgage Rates Current Mortgage Rates - North Dakota Current Rates - Montana Idaho Current Rates Washington Mortgage Rates Current Mortgage Rates - Oregon Current Mortgage Rates - Utah Current Mortgage Rates - Nevada Current Mortgage Rates - California







Real Estate Market News
  • New consumer finance bureau opens to criticism
  • Watchdog SAFE Act curbing toxic mortgages
  • Many consumers chronically mystified by mortgage maze
  • Why housing consumers say you need a real estate agent
  • States offer incentives for green improvements
  • More borrowers reach for ARMs
  • California issues consumer alerts for mortgage fraud
  • Why vacant homes are a tough sell
  • Could you qualify for a 'Qualified Residential Mortgage?'
  • Government failed housing, but continues heavy housing subsidies
  • Disconnect between what buyers, sellers want
  • Is your real estate agent packing the latest technology?
  • Mortgage maze still leaves home buyers in a haze
  • Jobs-housing connection a key indicator to watch
  • Investors move to the head of the home-buying class
  • Foreign buyers cashing in on U.S. housing closeout sale
  • S&P/Case-Shiller index confirms 'double-dip,' home buying opportunities
  • Half of consumers can't come up with down payment
  • Erate's 'Dirty Half Dozen Digital Ways to Buy or Sell in Today's Housing Market'
  • Married couples ready to take the plunge
  • Utah BBB issues EZ Loan Protection alert
  • ACORN shellacking was just nuts
  • Housing to take center stage in 2012 election
  • Don't over look credit union mortgages
  • Renting gets tricky
  • Voters united over homeownership
  • Big break for California short sellers
  • New survey ferrets out top markets for SFH rental property investments
  • Consumer watchdog opens amid efforts to defang the new agency
  • Housing counseling generates optimism during tough times
  • Feds target deceptive mortgage advertising years after ads contributed to crash
  • Mortgage rates eye of Wall Street storm after S&P downgrade
  • Feds pondering how to unload government-owned distressed properties
  • Best Back-to-School Real Estate Investment Cities
  • Investors better than banks, Feds at shrinking distressed inventory
  • Gauge your housing market's recovery and cash in
  • Home ownership beats renting, if you can get a loan
  • It's housing, stupid
  • Mortgage morass gets murkier

  • Refinancing: Selecting a Loan
  • Mortgage Program Options
  • Interest Only Mortgage
  • 100% Mortgage Financing - No Down Payment
  • Mortgage Rates Comparison
  • Mortgage Rates Tracker
  • Search for Mortgage Rates
  • No Costs Mortgage Refinancing
  • 2% Rule - Refinancing Mortgage
  • Yield Spread Premium
  • Zero Costs Mortgage Refinancing
  • Prepayment Penalty - Mortgage Refinancing
  • What is APR and how is it calculated?
  • Private Mortgage Insurance - Refinancing

  • Moving Ahead With Your Refinance
  • Apply for a Mortgage
  • Is it best to pay points up front to reduce the interest rate?
  • Rate Lock info - Refinancing Mortgage
  • Refinancing Mortgage Tax Information
  • Should you pre-pay your mortgage?
  • Title Insurance for Mortgage Refinancing
  • Homeowner's Insurance
  • Earthquake Insurance - Refinancing Mortgage





  • Most Current ERATE Financial Articles

     ERATE is a BBB Accredited Mortgage Broker in Santa Clara, CA 
    Android app on Google Play

    ERATE App FREE on iTunes

      

     HACKER SAFE certified sites prevent over 99.9% of hacker crime.
    ERATE on Twitter  
    The information contained on this website is provided as a supplemental educational resource. Readers having legal or tax questions are urged to obtain
    advice from their professional legal or tax advisors. While the aforementioned information has been collected from a variety of sources deemed reliable,
    it is not guaranteed and should be independently verified.
    Copyright 1999-2013 ERATE All rights reserved ·ERATE does not fund or broker mortages or loans.
    ERATE · 2900 Gordon Ave · Santa Clara · CA · 95051






    ERATE iPhone App - iTunes