Archive for December, 2009
Mortgage Rates Creeping Up
Posted by: | CommentsThe 30-year mortgage rates rose above 5% for the first time in a while. Conventional, jumbo and FHA mortgage rates rose slightly across the board. The Treasury department has announced that they will stop buying mortgage backed securities as 2009 winds down. The Feds will continue to purchase mortgage backed securities until March 31, 2010, as pledged earlier this year. But what happens after March 31st?
There really is no security in this investment anymore. Few, if any investors actually service the loans, and with the housing industry still very weak, and loan servicers holding almost all the power over the loans, investors are no longer flocking to purchase the loans from the original lenders. The lenders control modifications, payment forebearance rights, collections pricesses, foreclosure proceedings decisions, etc.
It is predicted that in order to entice investors, mortgage rates will have to rise dramatically in the near future. We are hearing rates numbers in the mid 5% range up to “the sky’s the limit” types of rates.
Refinancing Second Mortgage Loans
Posted by: | CommentsIf you took out an equity line or second mortgage in the last five years, we recommend you refinance it while rates are so low. Home equity loans and HELOCs were pretty easy to get a few years ago, but with the credit crunch and subprime mortgage melt-down, 2nd mortgages have become tough to obtain and even more difficult to refinance unless you have enough equity to refinance it into your first mortgage.
A second mortgage provides you the ability to eliminate your variable rate 2nd mortgage into a fixed rate mortgage with more stable terms. In most cases, refinancing adjustable rate loans and HELOC’s will save you thousands of dollars a year in interest by converting the compounded interest to a simple interest loan. If you are considering mortgage refinancing and want to get cash out with a FHA mortgage that lets you to borrow up to 95% of LTV. Take advantage record low rates and refinance your second mortgage and enjoy the financial benefits.
California Mortgage Rates Rebounding
Posted by: | CommentsAccording to California mortgage lender, Bryan Dornan, “Record low rates have made a significant impact on the housing recovery statewide.” 30-year fixed California mortgage rates have been reported as low as 4.5% for conforming and FHA loans. Unfortunately for many local residents, California home loans are more difficult to qualify for because stated income and no document mortgages have all but disappeared. The higher California FHA loan limits have been able to broaden the scope for many new borrowers to qualify for refinancing.
Yesterday, the Federal Reserve announced they were keeping mortgage rates unchanged and extending the government mortgage buying program which is good news for Americans but great news for borrowers living in California. 2010 may be the year that California home values rebound and many distressed homeowners have found comfort with the Home Affordable Refinance Program because it enables borrowers with no equity to refinance their Fannie Mae or Freddie Mac loans up to 125%.
Fed Keeps Mortgage Rates Low
Posted by: | CommentsThe Fed announced today that they were keeping mortgage rates unchganged. Refinance loan applications rose respectively due to the demand for distressed homeowners to refinance into a more affordable loan featuring a fixed interest rate. Conforming and FHA lenders have announced tighter lending guidelines for refinancing and home buying.
According to Mortgage Bankers Association, the home mortgage rates rose for the 2nd straight week to 4.92% from 4.88%, based on the MBA weekly interest rate report Home loan applications held relatively steady, too, increasing only .3% on a seasonally adjusted basis. Applications for refinancing represented 75.2% of all applications.
Mortgage refinance rates for a fifteen-year loan maintained 4.33%. These fixed-rate mortgage loans accounted for nearly 20% of refinance mortgage applications in October, Ruth Simon reports in today’s Wall Sreet Journal. That’s up from 9.1% a year earlier and 7.5% in October 2007.
Many loan applicants are interested in the fifteen-year mortgage rates because they have reached such low levels. However, borrowers who are used to a 30-year mortgage payment may suffer from sticker shock, because even with a 4.375% rate, the 15-year mortgages have a higher monthly payment. Mortgage rates have been at near-record low territory for the last couple of months, but the good news for 2010 was received as the Federal Reserve announced they were extend their program in which the government buys mortgage loan securities in the upcoming year.
Mortgage Bankers Association Sees Home Refinancing Trend
Posted by: | CommentsIn a recent article, the MBA forecasted mortgage trends for 2010 interest rates, mortgage refinancing activities and more. According to Mortgage Banker Association’s Weekly Application Survey, thirty-year mortgage loans with fixed rates dropped through November, falling 18 basis points relative to the month prior and ending November at 4.79 %. Fifteen-year home mortgage rates reached a new record low for the survey of 4.27%. The percentage of borrowers selecting the 15-year has risen in 2009 as a result of the widened spread between 15- and 30-year home loans. MBA forecasts that 30-year mortgage rates will rise through 2010 to end the year at 5.7%. In addition to conventional loans, MBA believes that both VA and FHA mortgage rates will rise a percentage point between now and 2011.
On a seasonally adjusted basis, home purchase loans applications declined almost 20 % from October to November. Mortgage refinance applications rose by about 1% over that time. MBA projects that mortgage loan originations will decrease from almost $2.0 trillion in 2009 to about $1.5 trillion in 2010. MBA forecasts that purchase originations will increase from $718 billion in 2009 to $804 billion in 2010, while refinance loan originations are projected to fall from $1.246 trillion to $693 billion. The Federal Reserve and U.S. Treasury home loan programs continue to dominate the secondary market. In November, Federal Reserve purchases of agency MBS accounted for about 80% of new MBS issuance from Fannie Mae and Freddie Mac.
FHA Mortgage Rates Dip
Posted by: | CommentsAfter four days of rising home mortgage rates ended today as consumers can now lock 30-year mortgage rates starting at 4.375% today. Conforming and FHA mortgage rates increased 0.25% to .375% last Friday and many borrowers put their refinance loan on hold hoping for rates to come back down. News came from HUD Friday that the Federal Housing Administration has decided to tighten credit standards for FHA home loans. In 2010 FHA lenders will be required to carry large bonds with significantly higher net-worth requirements for companies that plan to originate FHA loans in the future.
FHA loan defaults and foreclosures have caused HUD to reconsider FHA requirements and loan guidelines. Mortgage refinancing activity continues to be robust even through the Christmas season, because so many borrowers stand to benefit from a refinance loan that reduces their mortgage payments by hundreds of dollars.