Recent figures from the Federal Housing Finance Agency indicated that nearly 100,000 HARP loans were closed in August. That is a huge number for a program that got off the ground slowly. The launch of the HARP 2.0 program last spring was largely the reason for the spike in HARP loans closing. Prior to the HARP 2.0 program the maximum loan to value ratio for HARP loans was 125%. HARP 2.0 removed that limitation and allowed qualified borrowers to refinance to a better rate no matter how underwater they were on their Fannie Mae or Freddie Mac conventional mortgage.
Another reason the numbers spiked in August is that HARP 2.0 loans have been taking much longer to close in many cases than other loan types. Many of the loans that closed in August were probably started in June, May, or even April.
Lastly, the great interest rates we have seen in the last few months made HARP loans even more enticing to many borrowers late in the summer. Those great rates have improved further this fall so if you have an FHA mortgage or a conventional mortgage contact us in the form on the right to learn more about the HARP program or other government-backed mortgage programs.