HARP Extended Through 2018 – Industry Outlook

By August 28, 2017Industry Outlook
  • HARP Extended Through 2018 – The Federal Housing Finance Agency announced that it is extending HARP, a popular government refinancing program through Dec. 31, 2018. The Home Affordable Refinance Program was set to expire on September 30th. While the FHFA has once again extended the deadline by another 15 months, this time it plans to introduce a new loan program to eventually take HARP’s place. HARP, which was introduced during the housing crisis, helps homeowners refinance their mortgages when they may be current on their mortgage payments but have little to no equity in their homes. Through HARP, more than 3.4 million homeowners have refinanced their mortgages.

    New Program to Help Buyers Bypass Appraisals – Freddie Mac has announced a new program allowing some home buyers to skip a traditional appraisal, which could lower the fees the buyers pay and speed up the closing process. Freddie’s Automated Collateral Evaluation (or ACE) will determine a property’s collateral risk by pulling data from multiple listing services, public records, and historical home values, and then assess whether a buyer needs a traditional appraisal or an automated one. Borrowers who are refinancing may also be eligible for the program. Those who qualify for an automated appraisal could save up to $500 in fees and make it to closing up to 10 days sooner, Freddie Mac says.

    Jumbo Loans Get Less Expensive – According to the Mortgage Bankers Association, the interest rate for jumbo loans, those greater than $424,100, dropped five basis points last week, averaging 3.99 percent for the week. That is now 13 basis points lower than the conforming rate, which is the largest spread between jumbo rates and the conforming rate since March 2016. “A strong appetite for jumbo loans and a highly competitive jumbo market has led to increased availability and lower pricing,” says Joel Kan, an MBA economist. Sales on the higher end of the market are increasing, which also explains the stronger demand for jumbo loans lately.

    1 in 4 Homes Now Equity Rich – Based on ATTOM Data Solutions’ Q2 2017 U.S. Home Equity & Underwater report, the number of equity rich properties is now up more than 1.6 million properties compared to a year ago.  At the end of the second quarter, more than 14 million U.S. properties were considered equity rich. That means the combined loan amount secured by the property was 50 percent or less of the estimated market value of the property. The number of equity rich properties in the U.S. now represents 24.6 percent of all properties with a mortgage in the country.

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