MORTGAGE BONDS NEAR RECORD HIGHS

June 29, 2010. Mortgage bonds close today at near the highest level ever recorded as world economic problems abound. As bonds push higher, fixed mortgage rates drop. With good credit we are at 4 3/8% with 1% origination point at close of business today. These low rates will not be around for ever. Call today and see what we can do for you. Do not miss out. If you recently refinanced it may be worth taking another look.

MAKING HOMES AFFORDABLE

 Despite weak appraised values you still may be able to take advantage to today’s “crazy” low mortgage rates.  Using the “Making Homes Affordable” Freddie Mac Relief Refinance or Fannie Mae DU Refi Plus we can assist customers where the loan amount is up to 105% of the value on the home, with no mortgage insurance.  There are a few restrictions with this program; the existing loan cannot presently have mortgage insurance; the new loan cannot absorb a second mortgage; and if there is currently a second mortgage on the property, the holder of the second must agree to subordinate (not always that easy!).  Condos may be tough and investment homes may not realize a savings over existing rate.

Our 30 year fixed hit 4.375% and on a $200,000 loan the APR is 4.572%.  With no origination the same loan is at 4.625% with an APR of 4.716%. 

These rates are from close of business today and can change until locked in.  We assume good credit and collection of tax and insurance escrows.

Think Big Work Small

Click on the link "Think Big Work Small" at the lower right and watch Brian and Frank give you cutting edge incite on where your tax dollars are going.

Fed Votes to Hold Rate

Much to the surprise of all, mortgage rates continue to drop.  Inflation remains extremely low exerting downward pressure on rates.  At the Fed’s meeting today, the vote was 9 to 1 not to raise the short interest rates.  Despite some challenges due to low appraised values, we are closing plenty of loans, saving customers tons of money in their monthly mortgage payments.  Not everyone will qualify for exactly the same interest rate.  Don’t get “sucked in“ by the endless stream of ads on radio and TV.  Your interest rate will depend on many factors including credit scores, collection of escrows for taxes and insurance, whether the loan is for a purchase, rate and term refinance or a “cash out” refinance, etc. 

Here are several examples of rate quotes available at close of business today:

30 year fixed for $200,000 at 4.5% with 1 point origination, APR is 4.668%; with no origination points the rate is 4.75%, APR of 4.836%

5/1 ARM for $200,000 at 3.5% with 1 point origination, APR is 3.66%; with no origination the rate is 3.75%, APR of 3.828%.

Please remember, Mortgage Bonds are traded on the open market and the price moves everyday.  We can only guarantee a rate when it is locked in.

The larger the loan, the less the difference needs to be to make this worth while VS your current rate.

Check out my Mortgage News site for a handy mortgage calculator.

Call me today and I will review your options.  E mail me at union-mortgage@atmc.net    

We are a Mortgage Banker and now do loans in North Carolina, South Carolina, Virginia, Maryland, Delaware, DC, Georgia, W VA and Pennsylvania.

Tax Credit Extension Stuck In House

The June 30^th Tax Credit deadline is 6 days away and “Congress” has not yet scheduled a vote on the proposed extension to September 30.  It’s safe to say that there will be many unhappy borrowers if the Tax Credit extension is not passed.  Watch my Mortgage News site for more information.

Economist Suggest Delay in Rate Increase

The market continues on its erratic path.  With the agreement by BP to put $20 billion in escrow, stocks turned around into positive territory.  Remember as stocks recover from the most recent correction, upward pressure will be applied to bonds.  Mortgage rates are still incredibly low and there could never be a better time to buy a home then there is today.

This article (below) from our mortgage information service, discusses the Federal Funds rate (currently .25%) which affects the prime interest rate (currently 3.25%). Fixed rate mortgage are not tied to this rate and will continue to float based on the bond yield.

WASHINGTON (MarketWatch) – “Economists at 14 top U.S. banks have pushed back their estimate of the first Federal Reserve interest-rate increase until the middle of next year, according to their latest forecast released by the American Bankers Association on Wednesday.
The Fed can afford "a wait and see attitude" because inflation is not a threat, said Scott Brown, chief economist at Raymond James and Associates.
At the start of the year, the economists had generally expected the Fed to start tightening by December and saw a risk of higher inflation.
But this view has changed over the past six months. Now the greater risk is for deflation.” 

Bernanke Says Inflation in Check

This week Bernanke testified that inflation is in check and the economy has enough steam to prevent a double dip recession.  That’s potentially is good news for mortgage rates.  As our Real Estate market moves along, ever so slowly, low rates are very important to any recovery.  We are lending money and usually know up front whether or not someone qualifies.  Sometimes appraisals are a problem but with all the foreclosures, short sales and bank sales, we are not shocked by low values.

Warning, keep an eye on Congress’s reinstatement of the flood insurance program.  As of this morning it has not been voted on.  Not only are new policies unavailable but renewals will not happen until this is in place.  This is a big problem for our “Beach” clients.  If their anniversary date of the purchase of their home is in May, the renewal is due and they cannot get it.  I strongly suggest you write all contracts during this period with some kind of phrase “subject to the availability of flood insurance if required”. 

We have just been informed the some MI companies are relaxing their guidelines a little, allowing borrowers to go to 95% with mortgage insurance.  Rates have also been reduced for higher credit scores.