Freddie Mac began purchasing Home Affordable Refinance Program (HARP) 2.0 loans in January and by the end of the first quarter had acquired $5 billion of these refinances, according to the company’s first-quarter securities filing.

The newly revised HARP is designed to reach more borrowers that have little or no equity in their homes.

The secondary market agency estimated there are $70 billion of loans in its guaranteed portfolio with a current loan-to-value ratio of 105% that could be eligible for a HARP 2.0 refinancing.

Freddie also reported that it issued $2.6 billion of new loan repurchase requests to its seller/servicers in the first quarter, compared to $2.8 billion a year ago.

Outstanding repurchase requests rose to $3.2 billion as of March 31 from $2.7 billion a year ago.

During the first quarter, the agency collected $850 million in buybacks and cancelled $1.2 billion of requests.

“As of March 31, two of our largest seller/servicer had aggregate repurchase requests outstanding of $1.7 billion,” Freddie said. Nearly half of the requests have been outstanding four or more months.

In other Freddie Mac news. the government controlled agency posted net 'comprehensive' income of $1.789 billion in the first quarter — but then had to turn around a pay the U.S. Treasury $1.8 billion in dividends, resulting in a small true loss for the quarter.

It will ask the government for $19 million in assistance to bolster its net worth. To date, Freddie has received $72 billion in assistance from Treasury but paid the government $18 billion in dividends.

Without government support (in the form of preferred stock) Freddie would have a negative net worth position and investors would demand high yields on its borrowings or stay away altogether from its offerings in the capital markets.

Meanwhile, some industry lobbyists contend that after the November elections an Obama White House (should it turn out that way) might consider reducing the dividend payments the GSEs must upstream to Treasury every quarter.

In 1Q12, Freddie said it earned $577 million compared to a $619 million profit in 4Q11, and $676 million a year earlier. These figures exclude both the dividend payments to Treasury and a line item called 'total other comprehensive income' which reflects changes in the 'fair value' of available-for-sale MBS.

Freddie also reported improving 'serious' delinquencies, 3.51%, the lowest reading since August of last year.

Also, the credit profile of its borrowers continues to improve. In 1Q the average FICO of a Freddie borrower was 763 compared to 723 in the 2005 to 2008 period.

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