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Mortgage rates unchanged, but movement likely soon

Homeowners who owe more than their home is worth will get a new opportunity to refinance their mortgage, thanks to a new program announced last week by the Federal Housing Finance Agency.

The program, a near cousin to the federal government’s Home Affordable Refinance Program, is intended to help borrowers who haven’t been able to refinance because their loan-to-value ratio is higher than conventional loan guidelines.

The program won’t have an eligibility cutoff date. That suggests it will be open to eligible homeowners whose loan was sold to Fannie Mae or Freddie Mac after the HARP cutoff date, which was May 31, 2009. HARP is scheduled to sunset Sept. 30, 2017.

The new program won’t be available until September 2017, but it could set off “a mad rush” to refinance at that time, says Jim Pomposelli, vice president of mortgage lending at PERL Mortgage in Chicago.

Who will qualify

To qualify, borrowers must:

■ Have a loan that’s owned or guaranteed by Fannie Mae or Freddie Mac.

■ Have not missed any mortgage payments in the previous six months.

■ Have not missed more than one payment in the previous 12 months.

■ Have a source of income.

■ Receive a benefit from refinancing. A lower monthly payment counts as a benefit.

There is no minimum credit score or maximum debt-to-income ratio or LTV. An appraisal might or might not be required.

Borrowers who have used HARP to refinance will be eligible for the new program if they’ve completed an interim refinance into a non-HARP loan owned or guaranteed by Fannie Mae or Freddie Mac. A HARP loan cannot be refinanced directly into the new program.

Homeowners can start to position themselves now by making their payments on time even though they’re short of equity.

Rates this week

Mortgage interest rates might be higher a year from now than they are today.

In a recent speech, Federal Reserve Chair Janet Yellen said the case for a rate increase “has strengthened in recent months.”

The benchmark 30-year, fixed-rate mortgage stayed the same at 3.57 percent, according to Bankrate’s weekly survey of large lenders. A year ago, this rate was 4.03 percent. Four weeks ago, it was 3.56 percent.

The mortgages in this week’s survey had an average total of 0.23 discount and origination points.

Over the past 52 weeks, the 30-year fixed has averaged 3.85 percent. This week’s rate is 0.28 percentage points lower than the 52-week average.

■ The benchmark 15-year fixed-rate mortgage fell to 2.87 percent from 2.86 percent.

■ The benchmark 5/1 adjustable-rate mortgage went up to 3.09 percent from 3.07 percent.

■ The benchmark 30-year, fixed-rate jumbo mortgage stayed the same at 3.57 percent.

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