HARP Refinance Volume Falls 20% from April to May

The number of borrowers who refinanced through the Home Affordable Refinance Program (HARP) fell 20 percent month-over-month in May, data from the ""Federal Housing Finance Agency"":http://www.fhfa.gov/ (FHFA) revealed.

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The GSEs refinanced 84,648 borrowers through HARP in May, down from 106,910 in April. Despite the decrease, overall HARP volume remains strong and is still above last year's total for May, when around 73,000 loans were refinanced under HARP.

Since HARP's 2009 inception, the program has refinanced over 2.6 million loans.

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From January to May, HARP refinances represented 21 percent of total refinances, though in Nevada and Florida, the share was much higher, at 60 and 51 percent, respectively.

Florida was also among the top states for the greatest number of HARP refinances since 2009.
California led with 368,905 HARP refinances, followed by Florida (235,223), Michigan (178,035), Illinois (175,521), and Arizona (130,894).

Underwater borrowers, or those with loan-to-value (LTV) ratios greater than 105 percent, continued to account for a large percentage of HARP refinances, representing 44 percent of the total volume year-to-date through May.

In certain states, the share was much greater. In Nevada, 74 percent of HARP refinances were for underwater borrowers, according to data from the agency. Arizona and Florida also had a high share of underwater borrowers, at 62 and 66 percent, respectively.

Nearly one in five HARP refinances were for deeply underwater borrowers. In May, 19 percent of borrowers who refinanced under HARP had a LTV ratio greater than 125 percent.

In addition, 18 percent of underwater borrowers opted for shorter 15- and 20-year mortgages.