SOURCE: Paragon Financial Limited
NEW YORK, NY--(Marketwire - Oct 5, 2012) - The Mortgage Investment Industry has rebounded sharply in 2012 as homeowners have taken advantage of record low borrowing costs, and a steadily improving U.S. housing market. According to Lender Processing Services (LPS) August Mortgage Monitor report mortgage prepayment rates are currently at their highest levels since 2005. The Paragon Report examines investing opportunities in the Mortgage Investment Industry and provides equity research on Federal Home Loan Mortgage Corp. (OTCQB: FMCC) and Federal National Mortgage Association (OTCQB: FNMA).
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"Our analysis showed an increase in prepayment activity across the entire combined loan-to-value (CLTV) continuum," says LPS' Applied Analytics Senior Vice President Herb Blecher. "While those loans with equity, particularly 80 percent CLTV and below, have much higher prepayment speeds, the impact of the Home Affordable Refinance Program (HARP) was also clear. Loans with a CLTV of more than 120 percent saw the greatest uptick -- a 65 percent increase for the year to date.
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U.S. mortgage rates fell to record lows after the Federal Reserve announced stimulus measures focused on purchases of mortgage-backed securities. Rates for 30-year fixed mortgages fell to a record low of 3.36 percent, while the average 15-year rate declined to 2.69 percent.
Home-loan applications have recently surged to their highest levels in over three years according Mortgage Bankers Association. Applications for home loans surged 16.6 percent for the week ended Sept. 28, while an index tracking refinancing jumped 19.6 percent.
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