Fixed mortgage rates have hit new lows for three straight weeks, fueling a sustainable refinancing wave.
The Home Affordable Refinance Program, now dubbed HARP 2.0, has drawn half a million applications as of the last report by U.S. housing officials, who could see up to 2 million refinance applications through the revamped program that launched unofficially in March.
The Mortgage Bankers Association said that HARP 2.0 accounted for 28 percent of refinance applications last week.
The biggest jumps in refinance applications have take place in states with the highest rates of underwater homeowners, those who owe more on their mortgages than the worth of their homes. Refinance applications in Nevada, where 61 percent of borrowers are underwater, have jumped 267 percent since the new HARP guidelines were announced late last year.
Under the original HARP 1.0, lenders refinanced more than 1.1 million mortgages owned or guaranteed by Freddie Mac or Fannie Mae since the program’s launch in 2009. But only slightly more than 110,000 affected underwater borrowers with loan-to-value (LTV) ratios above 105 percent.
The focus of the expanded HARP 2.0 is homeowners current on their payments, but who owe much more on their mortgages than their homes are worth. The new HARP eliminates the LTV ceiling, reduces certain risk-based guarantee fees, and extends the program’s end date to December 2013.
We’ve found that the scope of the HARP 2.0 program will vary by investor. We can sift through these hurdles for you to try to find the right underwriting guidelines to get your mortgage approved. We’re helping Delawareans refinance and save everyday!
Nonetheless, the refinance share of mortgage activity last week increased to 74.9 percent of total applications from 72.1 percent the previous week, reported the Mortgage Bankers Association.