Fannie Refinancings up 88% in March

Fannie Mae said its refinancing volume totaled $77 billion in March, up from $41 billion in the previous month, as borrowers took advantage of lower mortgage rates and a new flexible refinancing program. The mortgage giant it has not seen this level of activity since refinancing boom of 2003. "We anticipate that volumes will increase even more as millions of additional homeowners become eligible to refinance" under the Home Affordable Refinance initiative, according to Fannie executive vice president Tom Lund. Under that initiative, Fannie and Freddie Mac are expected to use flexible underwriting to refinance mortgages they already own or guarantee. Borrowers with loan-to-value ratios between 80% and 105% can refinance at current market rates under this initiative. Mortgage insurance requirements have been waived on those refinancing transactions. Existing insurance policies will be transferred to the new loan, however. Lenders and brokers can use Fannie's Desktop Underwriter to process those refinancing applications.