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  • ‘HARP 2.0’ Implementation Continues

    As we near the end of 2011, the holidays can normally drive slightly higher mortgage rates as investor demand pulls back. Rates, however, have remained aggressive as ever as the balance of supply of mortgage applications versus investor demand has remained steady. The U.S. dollar and government debt continues to be a safe haven among investors worldwide. With the rating agencies continuing to downgrade and issue caution toward European countries for their debt levels, plenty of investment demand remains for Treasuries and mortgage-backed securities, keeping rates historically low. Many believe the positive economic news from last week, along with the $1 trillion budget deal made by Congress, actually fueled lower rates as investors became more optimistic that the U.S. would be able to successfully overcome debt concerns. It will be important to keep a close eye on the international stage, as unexpected news around debt crisis resolution on this front will drive international investment, resulting in higher mortgage rates. Even today, we have started to see some impact to rates as Germany reported higher than expected consumer sentiment and Spain was able to issue notes at yields far better than expected.    

    Investors and servicers are starting to get some pressure from Federal Reserve officials and politicians to expand their adoption of the new “HARP 2.0” program to help pass the benefits of this program to borrowers. Although many options have already been made available to borrowers, as support for the program improves, lenders like Guaranteed Rate will be able to offer even better rates and financing options. Look for how the adoption of this program continues over time.     





    Dec 19 2011