HARP 2.0 Refinance Program Finally Helps Severely Underwater Homeowners

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National HARP Mortgage Lender Network, HARP Approval, responds to a recent report by the FHFA on an increase in HARP refinance volume.

HARP Loan Volume

HARP Loan Volume Increases In June

Homeowners with high loan-to-value mortgage balances are finally seeing financial relief with HARP 2.0 refinance program.

National HARP Mortgage Lender Network, HARP Approval (http://harpapproval.com), responds to a recent report by the FHFA on an increase in HARP refinance volume.

The most recent Federal Housing Finance Agency (FHFA) monthly Refinance Report published August 7, 2012, shows HARP refinances for Fannie Mae and Freddie Mac mortgages with negative equity greater than 125% loan-to-value increased from 2,954 in May to 53,758 in June.

According to the FHFA, “The continued increase in HARP volume is attributed to record-low mortgage rates and program enhancements announced last fall including removal of the loan-to-value (LTV) ceiling for borrowers who refinance into fixed-rate
loans and the elimination or lowering of fees for certain borrowers.”

"The typical borrower who refinanced reduced their interest rate by about 1.5 percentage points. On a $200,000 loan, that translates into saving about $2,900 in interest during the next 12 months,” explains Frank Nothaft, Freddie Mac vice president and chief economist.

Click Here to check HARP Eligibility

Among other enhancements to the Home Affordable Refinance Program that went into effect, lenders became able to securitize HARP loans with LTV ratios higher than 125 percent starting June 1, 2012.    

“Banks are finally getting their internal underwriting and processing systems together, which is helping with backlog of HARP Applications that have been stacking up over the past few months,” states Brian Maier, Broker of Raintree Mortgage in Las Vegas, NV.

Nevada was one example of a breakout state with high negative equity HARP refinances. In May there were 197 HARP refinances for mortgages with an LTV higher than 125 percent, compared to 4,167 the next month in June, 2012.

The FHFA reported that HARP volume represented 33 percent of total refinance volume in June. In Nevada, Arizona and Florida, underwater borrowers represented over 80 percent of HARP volume, and in Idaho and California they represented more than 70 percent of HARP refinances.

Other highlights in the FHFA Refinance Report Indlude:

Fannie Mae and Freddie Mac refinanced 422,969 HARP loans in 2012, compared to a total of 400,024 in all of 2011.

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.

More than two-thirds of borrowers in states hard-hit by the housing downturn, such as 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.

About The Home Affordable Refinance Program (HARP 2.0):

In October 2011, the Federal Housing Finance Agency (FHFA), Fannie Mae and Freddie Mac announced enhancements to the Home Affordable Refinance Program that make it easier for lenders to refinance mortgages that had little or no equity.

HARP is refinance program created to help responsible borrowers who have continued to make their mortgage payments, but may be unable to refinance over recent years due to a decline in their home value.

CLICK HERE - to check HARP Eligibility status.

The Obama administration claims that HARP will save homeowners an average of $250 a month in mortgage payments, and that the Home Affordable Refinance Program overall will help an anticipated 4-5 million underwater homeowners.

Talks of an updated HARP 3.0 have been motivated by President Obama’s #MyRefi campaign that could expand refinancing opportunities to an estimated 22 million homeowners.

About HARP Approval:

HARP Approval (http://harpapproval.com) is a national online network of mortgage professionals and lending institutions who are authorized to participate in the Obama Administration’s updated versions of the Home Affordable Refinance Program (HARP 2.0 - 3.0). HARPApproval.com is managed by Best Rate Referrals (http://bestratereferrals.com/), a Nevada-based online publisher and mortgage technology firm that manages over 3,000 consumer-focused real estate and financial websites.

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Raymond Bartreau
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