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Small Wholesaler Seeing Big Results from HARP 2.0

Mortgage News

New business at a small Texas-based wholesale lender that operates in more than two dozen states has exploded since it began accepting applications for mortgages processed under the Home Affordable Refinance Program. Originations are so strong that the company is recruiting more employees to help it keep up with demand.

The program was originally launched in March 2009, though participation was far lower than originally projected. So HARP guidelines were eased in October 2011 with the elimination of requirements for loan-to-value limits, mandatory appraisals and representations and warranties.

But nearly half of banks surveyed by the Federal Reserve for the April 2012 Senior Loan Officer Opinion Survey on Bank Lending Practices indicated very little participation in HARP 2.0. Among the obstacles to utilizing the program are repurchase risk, difficulty in transferring private mortgage insurance coverage and the reconciliation of junior liens.

However, that hasn’t stopped 360 Mortgage Group LLC from utilizing the refinance program to push its new activity to an all-time high.

The Austin, Texas-based wholesale lender said it started accepting HARP 2.0 applications on March 19.

“Subsequently, 360 has experienced a significant increase in loan volume, resulting in the largest active pipeline since the company’s 2007 founding,” the company said Wednesday.

360 Mortgage Group, which lends in 25 states, reports that its loan pipeline skyrocketed 700 percent since it started accepting HARP 2.0 applications.

With business anticipated to continue rising, the firm said it is increasing its staff.

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