Freddie To Align With Fannie On Lower LTV HARP Guidelines
Freddie Mac said today that it wouldrnbe opening up refinance opportunities to borrowers who are not underwater onrntheir existing Freddie Mac mortgages. Underrnthe company’s Relief Refinance Mortgage Program which includes the HomernAffordable Refinance Program (HARP 2.0) the requirements for refinancingrnmortgages with loan-to-value ratios at or under 80 percent will be brought inrnline with those with LTVs over 80 percent, the target audience for HARP 2.0rnloans.</p
The alignment will involverneliminating many of the representation and warranty requirements that exist onrnthe mortgages being refinanced. It isrnhoped this will act as an incentive to lenders to promote the loans. Freddie Mac said it is further evaluating thernRelief Refinance program, specifically looking at the Open Access offering torndetermine the best way to reach eligible borrowers and assist lenders inrnmanaging capacity. Open Access isrndesigned to promote competition so that borrowers can obtain Relief RefinancernMortgages including HARP 2.0 from lenders other the one associated with theirrnexisting servicer. </p
Freddie Mac will announce details ofrnthe program changes by mid-September and they will go into effect for loansrndelivered after January 1, 2013. Thernchanges are based on lender feedback on HARP 2.0 which was rolled out startingrnlast fall</p
Paul Mullings, Senior Vice Presidentrnand Interim Head of Single Family at Freddie Mac said, “Once implementedrnthe changes will give lenders a new measure of certainty and ease when theyrnhelp borrowers with Freddie Mac owned- or guaranteed- mortgages take advantagernof today’s historically low mortgage rates. This will help us build onrnthe success of the HARP 2.0 and Relief Refinance Mortgage programs of helpingrnmore than 1.3 million Freddie Mac borrowers. Today’s announcement furtherrnunderscores Freddie Mac’s vital role in making affordable mortgage financingrnavailable to America’s homeowners and future homebuyers.”
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