GSE Refi Volume Falls in 4Q; Finishes HARP with 3.5M Refis

The Federal Housing Finance Agency reported Fannie Mae and Freddie Mac completed 245,620 refinances in the fourth quarter, a slight decrease from 253,135 in the third quarter.

The FHFA fourth quarter Refinance Report also showed 1,390 loans refinanced through the Home Affordable Refinance Program, bringing the total number of HARP refinances to 3.494 million since inception of the program in 2009 and completion in December.

The report (https://www.fhfa.gov/AboutUs/Reports/ReportDocuments/Refi_4Q2018.pdf) said year to date through December, 33 percent of HARP refinances for underwater borrowers were for shorter-term, 15- and 20-year mortgages. Borrowers who refinanced through HARP had a lower delinquency rate compared to borrowers eligible for HARP who did not refinance through the program.

FHFA reported from April 2009 through December, 2.918 million loans refinanced through HARP were for primary residences, 110,887 were for second homes and 464,551 were for investment properties. HARP volume represented 1 percent of total refinance volume.

Year to date through December, borrowers with loan‐to‐value ratios greater than 105 percent accounted for 16 percent of the volume of HARP loans. Thirty‐three percent of HARP refinances for underwater borrowers were for shorter‐term 15‐ and 20‐year mortgages. HARP refinances represented 2 percent of total refinances in Florida and Illinois compared to 1 percent of total refinances nationwide over the same period.

The report also said 9 percent of the loans refinanced through HARP in December had a loan‐to‐value ratio greater than 125 percent. Borrowers who refinanced through HARP had a lower delinquency rate compared to borrowers eligible for HARP who did not refinance through the program. Nine states and one territory accounted for more than 70 percent of the nation’s HARP eligible loans with a refinance incentive as of June 30,
2018.