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FHFA AND ZILLOW TALK HARP Zillow partnered with the Federal Housing Finance Agency (FHFA) in October to review eligibility requirements for the Home Affordable Refinance Program (HARP) and respond to borrowers who are confused about the program. Meg Burns, senior associate director for housing and regulatory policy for FHFA, joined Zillow for a Google+ Hangout session to field questions from underwater homeowners and explain HARP's finer points. Hosting the call was Erin Lantz, Zillow's director of mortgages. Responding to borrowers' worries about their financial situations, Burns reiterated that HARP has no minimum income or credit score requirements (though different lenders may have their own criteria). "It's a very streamlined product, which means lenders don't do traditional underwriting. They don't assess the borrowers' income amount nor look at the credit report," she said. "Most lenders really like that feature of the product because it makes it much easier for them to qualify a borrower for participation." Instead, borrowers are required to have a solid payment history, with no missed payments in the six months prior to refinancing and up to one missed payment in the 12 months prior. That history is used instead as a proxy for a borrower's ability to pay. "One of the great things about HARP is, if you continue to make payments on time, you ultimately will meet the payment history requirement," Burns remarked. She also stressed the program can also be used for second homes and for investment properties, though the fees may be slightly higher. Also discussed were several enhancements to the program (sometimes dubbed as "HARP 2.0") that went into effect in 2012 and expanded eligibility to more borrowers. Because those changes went into effect well after HARP's inception, Burns urged borrowers who applied prior to March 2012 to try again. One of the biggest changes was the removal of the original HARP's 125 percent ceiling on loan-to-value (LTV) ratios. The elimination of that cap has been especially helpful for borrowers in states like Nevada, which has seen a significant boost in HARP refinances since eligibility opened up, Burns said. In the second quarter of 2013 alone, loans with LTVs of 125 percent or higher made up nearly 20 percent of all HARP activity, FHFA revealed in its latest quarterly report. Finally, answering a Realtor's question regarding dubious advice offered by some companies to struggling borrowers, Burns warned consumers to be careful of who they trust—especially if that person recommends deliberately missing payments. "Don't ever go delinquent on your mortgage if you want to qualify for a program," she said. "It's highly likely, for one thing, that you'll be rejected anyway, and it's really bad for your credit score." Zillow's question and answer session represented one way in which FHFA is working to spread knowledge of HARP and get more borrowers involved. In addition to loosening eligibility requirements last year, the agency has extended the program for an additional two years, bringing the expiration date to December 31, 2015. In addition, FHFA recently announced the launch of a public awareness campaign that has it partnering with HGTV personality Mike Aubrey. Through the end of this year, FHFA will be working with Zillow on a HARP-specific blog created to answer questions about the program's specifics and offer advice. More information can be found at Zillow.com/education/HARP. VEROS PREDICTS REBOUND Veros Real Estate Solutions announced that its forecast shows the real estate recovery in California kicking into high gear. The report reveals a dramatic increase in San Francisco's forecast compared to the previous quarter, and now four of the five strongest markets in the country can be found in the Golden State. These results are from the company's VeroFORECAST for the 12-month period ending September 1, 2014. Veros' future home price index (HPI) forecast indicates most of the country is now looking to 46 appreciate during the next 12 months, with only 5 percent of markets expected to decline as compared to the 10 percent cited in the last update. Additionally, those declines are expected to be minor at -2 percent at the forecast's lowest level. The HPI indicates that, on average for the top 100 metro areas, Veros expects 4.8 percent appreciation over the next 12 months. This is the fifth consecutive quarter where the index has shown forecast appreciation and represents an upswing of more than 50 percent from last quarter's 3.1 percent national forecast. REPORT SHOWS HOME PRICE REBOUND IN NEARLY 25 PERCENT OF KEY MARKETS Property data through July shows home prices have rebounded completely in more than one-fifth of the nation's top regional markets, according to a report from Homes.com. According to the site's latest report, 22 of the top 100 markets in the United States reported price increases of more than 100 percent from their respective troughs, up from 19 the month prior. Marketing analyst Nicole Selvaggi explained that most of the markets that have come back completely "never suffered the significant numbers of foreclosures and short sales that characterized the housing economy from 2007 to 2012," and seven of the top 20 have benefited greatly from energy development from oil, gas, shale, or coal. "As a result, these markets experienced a very different housing scenario, with lower peaks and higher troughs than other markets in the same region," Selvaggi said. At this point, 44 markets have seen a rebound of at least 50 percent, up from 41 in the last report. In addition to the rebound, all 100 of the markets tracked in the Homes.com Local Market Index Report reported increases in home prices on both a monthly and yearly basis. In terms of yearly growth, many of California's most highly populated markets (including the Los Angeles, San Diego, and San Francisco areas) were among the top metros, with five additional smaller cities making the top list. "Rising home prices in California's coastal areas (Los Angeles, San Diego, and San Francisco), could be —pushing buyers inland to more affordable Riverside and San Bernardino counties," Selvaggi said, quoting an analysis from John Burns, CEO of John Burns Real Estate Consulting.

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