The Federal Housing Finance Agency report the total volume of mortgage refinances increased slightly in June as mortgage rates decreased from May, according to the agency’s Second Quarter 2014 Refinance Report.
Total refinance volume for the second quarter topped 344,000, while refinances through the Home Affordable Refinance Program (HARP) exceeded 54,000.
Refinances reviewed in FHFA first quarter report
Since 2009, more than 19.5 million mortgage refinances have been completed through Fannie Mae and Freddie Mac, including more than 3.1 million through HARP. FHFA estimates that as of first quarter 2014, there are roughly 810,069 borrowers who still are eligible and have a financial incentive to refinance their homes through HARP. Nationwide, these borrowers could save an average of almost $2,300 per year on their mortgage. To reach these borrowers, FHFA recently held town-hall style events in Chicago and Atlanta with local community and civic leaders, who are sharing information about HARP with homeowners. FHFA is planning future HARP outreach events for Detroit and Miami.
HARP awareness campaign goes on the road
HARP was established in 2009 to assist homeowners unable to access a refinance because of a decline in their home value. It’s designed to provide these borrowers with an opportunity to refinance by permitting the transfer of existing mortgage insurance to their newly refinanced loan, or by allowing those without mortgage insurance on their previous loan to refinance without obtaining new coverage.
HARP enhancements took effect in 2012 to increase access to the program for responsible borrowers. Although it was scheduled to expire at the end of 2013, it was extended to Dec. 31, 2015.
In the second quarter of 2014, 54,041 refinances were completed through HARP, bringing the total refinances through HARP from the inception of the program to 3,188,926. HARP volume represented 16 percent of total refinance volume in the second quarter. These refinances represented 37 percent of total refinances in Georgia and 35 percent in Florida, nearly double the 18 percent of total refinances nationwide over the same period.
Borrowers who refinanced through HARP had a lower delinquency rate compared with borrowers eligible for HARP who did not refinance through the program.