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Th e M Rep o RT | 61 O r i g i nat i O n s e r v i c i n g a na ly t i c s s e c O n da r y m a r k e t SECONDARY MARKET The laTesT "extending hAMp and hARp through the end of 2016 will provide real relief for borrowers who continue to face challenges either paying their mortgage or refinancing their loan." —FHFA Director Mel Watt Watt announces One-year extensions for HamP and HarP The government's two affordable housing programs extended until the end of 2016 in bid to provide further borrower relief. t he government's Home Affordable Refinance Program (HARP) and Home Affordable Modification Program (HAMP) will be extended until the end of 2016, according to a May announcement from Federal Housing Finance Agency (FHFA) Director Mel Watt. Speaking at the Greenlining Institute 22nd Annual Economic Summit, Watt announced a one- year extension of the govern- ment's two affordable housing programs, which began in 2009 in response to the housing crisis. Both programs were set to ex- pire at the end of 2015. "Since HAMP and HARP were first launched in 2009, these pro- grams have provided critically im- portant relief for many borrowers by allowing them to lower their monthly payments and, as a result, have prevented many foreclosures," Watt said. "HAMP provides modifications that allow borrow- ers significant payment reductions that are tied to their income. This gives borrowers a more stable, affordable monthly payment and improves performance rates. The HARP program allows borrowers, including those who are underwa- ter on their mortgage and who are regularly making their mortgage payments, to refinance their loans to take advantage of historically low interest rates." HARP is a program intended to help save money by lowering monthly payments for borrowers who are underwater but are regu- larly making mortgage payments, while HAMP is targeted toward borrowers who are delinquent and possibly facing foreclosure by providing them a modification with significantly reduced monthly payments tied to their income. The participation rates for both programs have on the decline, partly because many borrowers are already participating in one program or the other, and partly because of recovering house prices, Watt said, but lenders and sevicers continue to approve modifications through HAMP and refinances through HARP. "Extending HAMP and HARP through the end of 2016 will pro- vide real relief for borrowers who continue to face challenges either paying their mortgage or refinanc- ing their loan," Watt said. Watt said that this will be the final extension for FHFA's participation in HAMP and he anticipates that this will be the final extension for HARP, adding that neither program was intended to be permanent. Freddie mac's mortgage Portfolio expands for sixth time in last seven months The GSe sees an increase of $1.5 billion over February. F reddie Mac's total mort- gage portfolio expanded at an annualized rate of 0.9 percent in March, the sixth time in the past seven months the portfolio has expanded, while the serious de- linquency rate on single-family loans fell to its lowest level in six and a half years, accord- ing to Freddie Mac's recently released March 2015 Monthly Volume Summary. The portfolio's March expan- sion represented an increase of about $1.5 billion, up to $1.914 trillion. It was only the 14th time in the last 63 months that the portfolio has expanded dat- ing back to January 2010, at the height of the foreclosure wave. The serious delinquency rate on loans declined from February to March by 8 basis points, down to 1.73 percent. It is the lowest serious delinquency rate for loans backed by Freddie Mac since December 2008 in the midst of the housing crisis, when it was reported at 1.72 percent and had just experienced an increase of 20 basis points from the previous month. "This is good news, meaning that fewer and fewer homeown- ers with mortgages backed by Freddie Mac are 90-days past due on their mortgage payments or in foreclosure," Freddie Mac said on its blog. "This rate is substantially below the rate for the entire U.S. mortgage market, whose seriously delinquent rate was 4.52 percent at the end of 2014." Single-family refinance loan purchase and guarantee volume dipped in March after skyrocket- ing from January to February. In March, the total was $19.1 bil- lion, down from $20.2 billion in February (an increase from $12.4 billion in January). The percent- age of single-family refinance loan purchase and guarantee volume that comprised the total single-family mortgage portfolio increased, however, from 66 percent in February up to 68 percent in March. Ten percent of Freddie Mac's total single-family refinance volume in March was comprised of relief refinance mortgages, an increase from 9 percent in February (still down from 14 percent in January) The number of homeowners who received permanent loan modifications totaled 5,144 for March, an increase from the 4,684 modifications reported for February. With 14,621 modifica- tions to date in 2015, Freddie Mac is averaging 4,874 modifica- tions per month. An average of 5,596 permanent loan mods were completed monthly in 2014. Freddie Mac reported that the aggregate unpaid principal balance (UPB) of the Enterprise's mortgage-related investments portfolio in March increased month-over-month by about $1.4 billion after dropping by $3.2 bil- lion from January to February.