Homeowners who refinanced their mortgage terms under low interest rates in the third quarter resulted in up to $3 billion in payment savings over the first 12 months of the new loan, according to a Freddie Mac (FRE) report.

As a result, one-half of borrowers who refinanced their conventional loans in the latest quarter lowered their annual mortgage interest rate by at least 17% according to the company’s quarterly report. The new rate was about 1.1 percentage points below the old rate.

Freddie said 64% of prime borrowers who refinanced a conventional, first-lien mortgage either kept about the same principal balance or reduced it, the highest such share in six years.

The government-backed mortgage company also said the Homeownership Affordability Refinance Program has helped 93,000 borrowers refinance loans even if they had no home equity, with the bulk occurring in July and August.

After months of growing pains, the Obama administration said last month the modification effort was picking up steam. But a critical report issued earlier this month by a congressional panel said there was evidence eligible borrowers were being denied incorrectly.

Found here.