According to Housing Predictor, Freddie Mac purchased fewer loans in March and reduced its share of the mortgage market. The number of mortgages Freddie Mac bought in March dropped 4.7% to $2.14 trillion. Citing the bills in Congress to abolish, or at least reform, Freddie Mac and Fannie Mae, Freddie Mac is now on a path to reduce the number of mortgages it buys. The unpaid principal balance of Freddie Mac- and Fannie Mae-related home mortgages in their portfolios fell $4.1 billion as lenders were forced to buy back more mortgages that were determined to be underwritten at low quality levels.

Mortgage delinquencies on single-family homes dropped in March, as did first-quarter homeowner vacancies, as reported by Realtor.org. Delinquencies on single-family homes fell to 3.63% last month compared to 3.78% in February, as reported by Freddie Mac. Meanwhile, overall vacancies remain high, even though the percentage of empty homes dropped in the first three months of the year. The South held the highest rates for the first quarter with 2.8%, followed by the Midwest with 2.7%.

MarketWatch recently reported that the average mortgage rates fell again. According to the latest Freddie Mac survey, the average rate for a 30-year fixed-rate mortgage was 4.78% for the week ending April 28, down from 4.8% in the previous week. Meanwhile, the rate for 15-year fixed-rate mortgages fell from 4.02% last week to 3.97% this week. This week’s rate was at its lowest level since early December 2010.

According to an article in The Wall Street Journal, many who support a government-backed housing finance system are predicting calamity for the housing markets without government mortgage guarantees, yet the Federal Reserve is telling a different story. Reserve data shows that nonbank institutional investors had assets of $28 trillion in the fourth quarter of 2010. The WSJ article went on to explain that about $13 trillion of this amount was invested in fixed income or debt securities, but only $1.8 trillion was invested in U.S. government-backed securities.

Home sales in the Hamptons are dropping. Bloomberg.com reported that the summer playground for wealthy New Yorkers has seen a 22% drop in the first quarter, plunging to 309 transactions from 396 the previous year. This drop was the largest since the second quarter of 2009. The drop isn’t due to lack of demand but, rather, the relentless snow and poor weather that kept Manhattan buyers away from the market.

Reverse Mortgage Daily recently reported that the reverse mortgage market index dropped 18% from peak levels in 2006. The latest data from the Reverse Mortgage Market Index (RMMI) shows that the amount of home equity held by seniors fell to $3.3 trillion at the end of 2010. According to RiskSpan, the growth or decline of the reverse mortgage market largely depends on the senior population growth, housing prices and senior debt levels.

The Home Equity Conversion Mortgage (HECM) is expected to generate $304 million of receipts in 2012, as reported by Reverse Mortgage Daily. This growth is largely due in part to the Federal Housing Administration’s new HECM Saver program, which gives borrowers access to home equity in amounts that are between 10-18% less than it would have been available with the HECM Standard option.

U.S. mortgage rates fell to the lowest level in almost two months, according to a Bloomberg article. The average rate for a 30-year fixed-rate loan was 4.76% this week – down from 4.88% last week, based on data from Freddie Mac. After staying at 4.15% the past two weeks, the rate for a 15-year fixed-rate mortgage was 3.97%, according to the Bloomberg article. Experts believe the lower interest rates — a reaction to the crisis in Japan — will spur more refinancing.

Bloomberg also reported that mortgage applications fell the week ending March 11. According to the Mortgage Bankers Association, mortgage applications dropped 0.7%. The purchase application index declined 4% last week from two weeks ago, but the refinancing gauge was up 0.9%, Bloomberg reported. Look for the refinance index to increase, thanks to lower interest rates.

The New York Times reported that more people are turning to adjustable-rate mortgages (ARMs) as lenders are providing more conservative ARM products by eliminating “teaser” rates that adjust every six months, or the “pick-a-pay” and “option” features that allow borrowers to pay less than the monthly interest, only to be socked with a huge bill later on. The most popular ARMs are the 5/1 ARMs and 7/1 ARMs, in which the initial interest rate is fixed for the first five or seven years — after which many homeowners consider selling or refinancing their home — then adjusted annually at a capped rate toward a maximum level. The NYT article said the cost savings compared to a 30-year fixed-rate loan are significant. For example, someone borrowing $500,000 with a 5/1 ARM at 3.5% would save $42,507 over the first five years, compared to a fixed-rate loan of 5.25%. A 7/1 ARM at 4.125% would save $38,330 over the first seven years.

On Long Island, the number of home repossessions for February was 717. RealtyTrac data reported in Newsday showed that there were 340 new cases in Nassau County last month and 377 in Suffolk. The Newsday article also showed that, based on data from the Empire Justice Center, a nonprofit organization, Long Island had more than 26,079 homes in the foreclosure process last fall and another 20,985 loans at least 90 days past due. Since October 2010, the number of repos has declined.

Rates for 30-year mortgages have increased slightly. Freddie Mac reported this week that the average rate for 30-year fixed-rate mortgages was at 4.88%, up from 4.87% last week. The 5/1 ARM showed a slight increase from 3.72% last week to 3.73% this week. The 15-year rate remained unchanged at 4.15% and the one-year adjustable rate mortgage was at 3.21%, down from 3.23% the previous week.

According to Bloomberg, mortgage applications in the U.S. were up last week. Bloomberg reported that the Mortgage Bankers Association’s index of loan applications was up 16% for the week ending March 4 — the biggest gain since June 2010 — over the previous week. The MBA further noted that the purchase index rose 13% last week compared to the previous week (the most since November 2010) and the refinancing gauge jumped 17%. Economists say more people were looking to purchase or refinance their homes as unemployment eased up and more companies sought to hire more people.

An article in the San Francisco Chronicle stated that Republicans have introduced a bill to kill the Home Affordable Modification Program (HAMP). When HAMP was announced in February 2009, the Obama administration predicted that it would help 3-4 million homeowners avoid foreclosure under this voluntary program. As of December 31, 2010, only 522,000 homeowners participated in the program.

Fitch Ratings announced on Wednesday that it is unveiling a new model to determine potential losses from securities backed by U.S. home mortgages. The new home price model will help predict which borrowers will end up “underwater” — that is, owing more than what their home is worth. This system will help investors who buy mortgage-backed securities. Fitch plans to seek comments on its new modeling system for the next 45 days from investors.

The Mortgage Bankers Association predicts that residential mortgage lending is expected to shrink to its lowest levels since 1997 as demand for home refinancing plunges due to higher interest rates and stricter lending requirements. The MBA says lenders will underwrite $966 billion on mortgages in 2011, down from $1.505 trillion in 2010 and $1.995 trillion in 2009. In 1997, mortgage originations were at $833 million. However, mortgage bankers expect an increase in loans for home purchases from $473 billion last year to $614 billion this year.

The Washington Post reported Tuesday that more people near the end of last year did “cash-in” refinancing of their mortgages, mostly to qualify for interest rates that were at near-historic lows. In the fourth quarter of 2010, 46% of borrowers who refinanced their primary mortgage brought cash to settlement to lower the balance on their loans, according to Freddie Mac. That is the highest percentage of “cash-in” refinances since the company tracked such numbers in 1985.

This week, the average contract interest rate for the 30-fixed rate loan was 4.77%, down slightly from 4.78% last week. Meanwhile, the average rate for a 15-year mortgage saw a small increase, from 4.15% last week to 4.16% this week According to an Associated Press article, interest rates have risen half a percentage point over the past two months; during that time, investors sold off Treasury bonds, driving yields lower. Mortgage rates tend to track the yield on the 10-year Treasury note.

The Mortgage Bankers Association said mortgage applications rose 5% this week, compared to the previous week. The MBA added that the refinance index rose 7.7% this week, the third straight week of increase in refinances, but the number of purchase applications fell by 1.9%.

Next to 2009, the year 2010 was the worst year for new home starts. The AP reported on Wednesday that builders broke ground on a total of 587,600 homes in 2010, compared to 554,000 housing starts in 2009. The 2010 figures mark the second worst year for new homes since 1959. In December, builders started work at a seasonally adjusted rate of 529,000, according to the Commerce Department. That is a 4.3% decrease from November.

Rising mortgage rates may mean that more people will be reluctant to purchase a home at a time when the housing market is still tenuous. The National Association of REALTORS recently reported that pending home sales in November rose 3.5% to 92.2, from 89.1 in October. (Pending home sales reflect the number of contracts and not closings, which normally occur with a lag time of one to two months.) The NAR states it is confident that the trend would continue into 2011.

The rate for a 30-year loan has risen for six of the past seven weeks amid speculation that President Barack Obama’s agreement to a two-year tax cut extension will boost economic growth and inflation. The rate increase means that the monthly cost of a $300,000 loan will go up from $1,462 to $1,585, according to the Bloomberg article.

In New York, it was a different story: existing-home sales in the Empire State during the same month were down 8.3% from October, according to the New York State Association of REALTORS. In November, New York REALTORS sold 5,260 existing single-family homes, which is lower than the 5,735 homes sold the previous month. In November 2009, 7,705 homes in New York State were sold, which was 31.7% higher than the November 2010 numbers.

New-home sales saw a 5.5% increase, according to today’s article from TheStreet.com. The Commerce Department reported today that sales of newly-built homes rose from a downwardly revised rate of 275,000 units in October to a seasonally adjusted annual rate of 290,000.

The Mortgage Bankers Association reported that mortgage applications fell 9.8% last week compared to the previous week on a seasonally adjusted basis, according to an article in today’s REALTORMag.com. On an unadjusted basis, last week’s purchase index was 4.9% lower than the week before and 8.4% lower than the same week a year ago.

The MBA also reported that the average interest rate for 30-year fixed-rate mortgages increased to 4.85% from 4.84% the previous week. The average rate for 15-year fixed-rate mortgages, meanwhile, rose to 4.22% from 4.21% the previous week.

According to the Mortgage Bankers Association, the refinance index also declined for the fifth consecutive week by 0.7%. However, the refinancing share of the mortgage activity grew to 76.7% of total applications, up from approximately 75% the week before. Meanwhile, purchase applications fell 5% after three weeks of gains.

Michael Fratantoni, MBA’s vice president of research and economics, said the decline in refinancing activity could be attributed to mortgage rates reaching six-month highs as Treasury rates increased after the Federal Reserve initiated another round of purchasing government securities.

The MBA also reported that the average interest rate on a 30-year fixed-rate mortgage was 4.84% last week, compared to 4.66% last week — the highest level since May 2010. Rates for 15-year fixed-rate mortgages increased from 3.98% to 4.21%.

According to the latest Mortgage Bankers Association survey, mortgage purchase applications rose by 1.4% last week, compared to the previous week on a seasonally adjusted basis. On an unadjusted basis, purchases increased 0.2% last week compared to the week before, but were down 28% compared to the same week last year.

Overall, mortgage application volume dropped by 5% over the last week on a seasonally adjusted basis because refinances fell by 6.4%, according to the REALTORMag article. Interest rates, meanwhile, had mixed results as the average rate for 30-year fixed-rate mortgages moved up from 4.25% to 4.28%. However, the average rate for 15-year fixed-rate mortgages decreased from 3.67% to 3.64%.