Are record-low interest rates masking high-cost mortgage lending?

Are record-low interest rates masking high-cost mortgage lending?

Five leading economists weigh in and the answer may surprise you partners with Google to predict housing trends

Nowcast will predict in real time

The New York Times rambles, and mangles mortgages along the way

Mortgage finance and mortgage regulation aren’t the paper’s strong suits

GSEs Stay Cool on High LTVs in First Refi Report

[Update 1: Clarifies the share of HARP refis over 80% LTV] Mortgage giants Fannie Mae (FNM) and Freddie Mac (FRE) as of July refinanced more than 2.9m mortgages so far in 2009, according to a new monthly report by the Federal Housing Finance Agency (FHFA). The government-sponsored enterprises (GSEs) refinanced 1.9m mortgages through the Home Affordable Refinance Program (HARP) since its inception in April. Of these HARP refinances, less than 61,000 -- or 3.2% -- were refinancings of mortgages with loan-to-value (LTV) ratios between 80% and 105%. “Borrowers refinancing their loans are enjoying significant interest rate reductions refinancing through the GSE streamlined refinance process with an average rate reduction of 1.3%," said director James Lockhart. "Importantly, over 60,000 borrowers with mortgage loans that exceed 80% of the house value up to 105% have been refinanced." Fannie refinanced 1.7m loans as of July, 32,000 of which bore the high loan-to-value (LTV) ratios between 80% and 105% urged under HARP. Freddie refinanced 1.2m loans, 29,000 of which bore high LTVs. "We are now seeing significant results from the HARP and the Home Affordable Modification Program (HAMP), but much more work needs to be done," Lockhart adds. Regulators recently expanded HARP to allow refinances on mortgages up to 125% LTV. Fannie begins accepting those refinances on September 1 and Freddie plans to follow a month later. Write to Diana Golobay.

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