Fixed mortgage rates fell to the lowest level in six decades for the second straight week, according to new figures compiled by Freddie Mac. The GSE said the average rate on the 30-year Fixed Rate Mortgage dropped to 4.09%, the lowest rate since 1951. The average rate on the 15-year mortgage, a popular refinancing product, fell to 3.30%, also a new low. Freddie Mac chief economist Frank Nothaft said continued investor worries over the debt crisis in Europe kept Treasury bond yields low, driving down mortgage rates in the process. Over the past week the yield on the benchmark 10-year Treasury fell to as low as 1.9% before rebounding to 2.08% on Thursday.
The market had a "slew" of economic news Thursday. The Consumer Pride Index was +.4% (higher than expected), but Jobless Claims were +11k to a total of 428k - higher than expected. The Empire State Manufacturing Survey General Business Conditions index inched down one point. Nationwide, Industrial Production increased 0.2% in August, and Capacity Utilization edged up to 77.4%. The Philadelphia Fed Index of General Business activity within the factory sector rose to -17.5 this month from -30.7 in August and 3.2 in July.
The impact of all this on rates was not particularly good, since the ECB coordination with our Fed will dampen the bid for safe assets (i.e., Treasury securities) and the CPI rose faster than expected in August. The 10-year US Treasury note yield increased as much as 13 basis points to 2.12%, after having dropped to a record low of 1.8770% three days ago and closed at 2.09%. Volume in Mortgage Backed Securities was light Thursday at just 64% of the 30-day average, according to Tradeweb's experience, and prices were worse by about .250.
The Federal Housing Administration is selling 11,000 to 13,000 foreclosed homes a month after re-engineering the way it manages and markets Real Estate Owned, or REO. For the first nine months of fiscal year 2011 (ending June 30) the average days-to-list and the average days-to-sell REO decreased by 76 days (61%) and 25 days (12%) respectively, as compared to Financial Year 2010, according to the commissioner's Sept. 8 testimony. This acceleration of sales has allowed FHA to reduce its REO inventory by nearly 40% in four months. "As a result of these initiatives and despite the spike in properties being conveyed to us, FHA's inventory of REOs is down to 48,324," Galante testified. The agency had an REO inventory of nearly 80,000 REO at the end of March.
30 year fixed - 3.99% + .50 cost points for rate
20 year fixed - 3.75 % + 0 points for rate
15 year fixed - 3.250% + .50 points for rate
10 year fixed - 3.250% 0 cost points for rate
5/1 ARM - 2.50% - 0 points for rate
7/1 ARM - 2.875% + 0 points for rate
FHA/VA
30 year fixed - 4.00% with 0 points for rate
5/1 ARM - 2.75 with 0 points for rate
7/1 ARM - 3.25 with 0 point for rate
Jumbo - up to 2,000,000 with 20% down
30 year fixed - 4.750 % with +.250 points for rate
15 year fixed - 4.250% + .250 cost points for rate
5/1 ARM - 3.250% + .250 points for rate
7/1 ARM - 3.750% + .250 points for rate
10/1 ARM 4.375% with +.250 points for rate
Friday, September 16, 2011
Friday, September 2, 2011
Current rates and market news
Rates continue to be historically good, and should be for quite some time. Of course we will see daily fluctuations, but with the Fed firmly in the 0% and plan to stay there mode, mortgage rates should continue to sit around these levels for quite some time.
The Wall Street Journal reported that "Bank of America Corp. intends to sell its correspondent mortgage business, as the troubled lender looks to narrow its focus and bolster its financial strength...Employees could be notified as soon as Wednesday that the lender has decided to exit the correspondent channel because it no longer fits with the long-term strategy for its mortgage unit. The company decided to get out roughly four to six weeks ago, following a review led by mortgage chief Barbara Desoer. The business employs more than 1,000 people." What this means is, there are fewer and fewer big lenders in the business, the pricing on Chase home loans last week were in excess of 1.00% higher than other lenders - big banks do price themselves out of the market when - they are about to close a division or they have more loans application than they can close.
The Federal Housing Finance Agency (FHFA) has reported the national average mortgage rate for the purchase of previously occupied homes by combined lenders was 4.57 % for loans closed in July - a decrease of 0.05% from the previous month. The average interest rate on conventional, 30-year, fixed-rate mortgage loans of $417,000 or less decreased to 4.69% in July. The FHFA also reports that the contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 4.55% in July, down from 4.61% in June. The effective interest rate, which reflects the amortization of initial fees and charges, was 4.67% in July, down 7 from 4.74% in June.
U.S. home prices increased by 3.6% in the second quarter, after having fallen 4.1% in the first quarter, according to new data from the Standard & Poor's (S&P)/Case-Shiller Home Price Indices.
"Looking across the cities, eight bottomed in 2009 and have remained above their lows," says David M. Blitzer, chairman of the index committee at S&P Indices. "These include all the California cities, plus Dallas, Denver and Washington, D.C. - all relatively strong markets. At the other extreme, those which set new lows in 2011 include the four Sunbelt cities - Las Vegas, Miami, Phoenix and Tampa - as well as the weakest of all, Detroit.
These shifts suggest that we are back to regional housing markets, rather than a national housing market where everything rose and fell together."
30 year fixed - 4.250% 0 points for rate
20 year fixed - 3.875% 0 points for rate
15 year fixed - 3.250% 0 points for rate
10 year fixed - 3.250% + 1.00 lender credit points for rate
5/1 ARM - 2.50 % 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 4.250% + 0 points for rate
5/1 ARM - 2.75+ 0 points for rate
7/1 ARM - 3.250 + 0 point for rate
Jumbo - over 729,000 up to 2,000,000 with 20% down on purchase
30 year fixed - 4.750 % with 0 points for rate
15 year fixed - 4.375 % + 0 points for rate
5/1 ARM - 3.250 % + 0 points for rate
7/1 ARM - 3.75% + 0 points for rate
10/1 ARM - 4.375% with + 0 points cost for rate
The Wall Street Journal reported that "Bank of America Corp. intends to sell its correspondent mortgage business, as the troubled lender looks to narrow its focus and bolster its financial strength...Employees could be notified as soon as Wednesday that the lender has decided to exit the correspondent channel because it no longer fits with the long-term strategy for its mortgage unit. The company decided to get out roughly four to six weeks ago, following a review led by mortgage chief Barbara Desoer. The business employs more than 1,000 people." What this means is, there are fewer and fewer big lenders in the business, the pricing on Chase home loans last week were in excess of 1.00% higher than other lenders - big banks do price themselves out of the market when - they are about to close a division or they have more loans application than they can close.
The Federal Housing Finance Agency (FHFA) has reported the national average mortgage rate for the purchase of previously occupied homes by combined lenders was 4.57 % for loans closed in July - a decrease of 0.05% from the previous month. The average interest rate on conventional, 30-year, fixed-rate mortgage loans of $417,000 or less decreased to 4.69% in July. The FHFA also reports that the contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 4.55% in July, down from 4.61% in June. The effective interest rate, which reflects the amortization of initial fees and charges, was 4.67% in July, down 7 from 4.74% in June.
U.S. home prices increased by 3.6% in the second quarter, after having fallen 4.1% in the first quarter, according to new data from the Standard & Poor's (S&P)/Case-Shiller Home Price Indices.
"Looking across the cities, eight bottomed in 2009 and have remained above their lows," says David M. Blitzer, chairman of the index committee at S&P Indices. "These include all the California cities, plus Dallas, Denver and Washington, D.C. - all relatively strong markets. At the other extreme, those which set new lows in 2011 include the four Sunbelt cities - Las Vegas, Miami, Phoenix and Tampa - as well as the weakest of all, Detroit.
These shifts suggest that we are back to regional housing markets, rather than a national housing market where everything rose and fell together."
30 year fixed - 4.250% 0 points for rate
20 year fixed - 3.875% 0 points for rate
15 year fixed - 3.250% 0 points for rate
10 year fixed - 3.250% + 1.00 lender credit points for rate
5/1 ARM - 2.50 % 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 4.250% + 0 points for rate
5/1 ARM - 2.75+ 0 points for rate
7/1 ARM - 3.250 + 0 point for rate
Jumbo - over 729,000 up to 2,000,000 with 20% down on purchase
30 year fixed - 4.750 % with 0 points for rate
15 year fixed - 4.375 % + 0 points for rate
5/1 ARM - 3.250 % + 0 points for rate
7/1 ARM - 3.75% + 0 points for rate
10/1 ARM - 4.375% with + 0 points cost for rate
Thursday, August 18, 2011
Rates are stable, costs to borrow increase - how can this be?
Borrowing costs are higher this week. When volatility picks up in the secondary mortgage market, the cost of doing business gets more expensive for lenders (hedging costs go up). The added costs are passed down to consumers. These costs are unavoidable.
Some lenders have been adjusting their loan pricing much higher because they can't take-in anymore business. They have pushed rates higher to encourage consumers to either wait it out or find another lender offering lower rates.
CURRENT MARKET as reported by Mortgage Rate Watch - The Best Execution 30-year fixed mortgagerate has fallen to 4.125%. Several lenders are willing to offer 4.000% and even 3.875% is possible for those interested in buying down the rate with points. 4.250% is widely-available. On FHA/VA 30 year fixed Best Execution is 4.000%, but 3.875 and even 3.750 are available with additional closing costs. 15 year fixed conventional loans are best priced at 3.625% but we're seeing aggressive quotes as low as 3.375%. Five year ARMs are still best priced at 3.25. ARMs seem to have bottomed out.
Purchasing a home is currently cheaper than renting in 74% of major U.S. cities, according to Trulia's Summer 2011 Rent vs. Buy Index , which compares the cost of buying and renting a two-bedroom apartment, condominium or townhouse in the nation's 50 biggest cities.
30 year fixed - 4.125% + .0 points for rate
20 year fixed - 3.750% + 0 points for rate
15 year fixed - 3.375 % + 0 points for rate
10 year fixed - 3.250% + .50 points credit for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 4.00 % + .500 points for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.125 + .250 point for rate
Jumbo - over 625,500 - to 2,000,000 Fairfield County
30 year fixed - 4.625 % + 0 points for rate
15 year fixed - 4.250% + 0 points for rate
5/1 ARM - 3.125 % + 0 points for rate
7/1 ARM - 3.625% + 0 points for rate
10/1 ARM - 4.250% + 0 points cost for rate
Some lenders have been adjusting their loan pricing much higher because they can't take-in anymore business. They have pushed rates higher to encourage consumers to either wait it out or find another lender offering lower rates.
CURRENT MARKET as reported by Mortgage Rate Watch - The Best Execution 30-year fixed mortgagerate has fallen to 4.125%. Several lenders are willing to offer 4.000% and even 3.875% is possible for those interested in buying down the rate with points. 4.250% is widely-available. On FHA/VA 30 year fixed Best Execution is 4.000%, but 3.875 and even 3.750 are available with additional closing costs. 15 year fixed conventional loans are best priced at 3.625% but we're seeing aggressive quotes as low as 3.375%. Five year ARMs are still best priced at 3.25. ARMs seem to have bottomed out.
Purchasing a home is currently cheaper than renting in 74% of major U.S. cities, according to Trulia's Summer 2011 Rent vs. Buy Index , which compares the cost of buying and renting a two-bedroom apartment, condominium or townhouse in the nation's 50 biggest cities.
30 year fixed - 4.125% + .0 points for rate
20 year fixed - 3.750% + 0 points for rate
15 year fixed - 3.375 % + 0 points for rate
10 year fixed - 3.250% + .50 points credit for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 4.00 % + .500 points for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.125 + .250 point for rate
Jumbo - over 625,500 - to 2,000,000 Fairfield County
30 year fixed - 4.625 % + 0 points for rate
15 year fixed - 4.250% + 0 points for rate
5/1 ARM - 3.125 % + 0 points for rate
7/1 ARM - 3.625% + 0 points for rate
10/1 ARM - 4.250% + 0 points cost for rate
Friday, August 12, 2011
What do these numbers mean - #mortgage rates this week
It is easy to be confused, or misled, with seemingly simple numbers. For example, you are saving for your child's college costs, expected be about $100,000. You are 80 percent funded with $80,000 in your account. The next year, your investment account drops 25 percent in value, to $60,000. The year following year it bounces back 25 percent. Is the value back to where you started? No, because now you have $75,000 in your account. Assume college costs are rising 8 percent per year. How close to paying for college are you? The answer: 64 percent, because you have $75,000 toward $117,000 of costs. Even though your investments rose the same percentage as they fell, you're further from your goal than before. This is the same situation faced by pension funds. This is why, if you are locking in a loan, at these historically low rates, you MUST think of your long term and short term financial plans.
The FEDERAL RESERVE took the extraordinary step of announcing that it was minded to keep the federal funds rate close to zero for at least two more years. It also restated that it was "prepared to employ" a "range of policy tools" if the economy worsens, which some think might include a third round of bond-buying.
As stock markets tumbled, the price of GOLD surged to trade above $1,800 a Troy Ounce, reaching parity with platinum prices for the first time since the end of 2008.
AMERICAN INTERNATIONAL GROUP (AIG) lodged a lawsuit against BANK OF AMERICA, claiming BofA sold it low-risk securities backed by "defective" mortgages given to low-income borrowers. It is one of the biggest claims so far to originate from the practices that led to the financial crisis; suits against other big banks are expected to follow.
30 year fixed - 4.125% + .0 points for rate
20 year fixed - 3.750% + .250 points for rate
15 year fixed - 3.250% + .250 points for rate
10 year fixed - 3.250% + 1.125 lender credit points for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 3.874% + .500 points for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.125 + .250 point for rate
Jumbo - over 625,500 - to 2,000,000 Fairfield County
30 year fixed - 4.750 % + 0 points for rate
15 year fixed - 4.250% + 0 points for rate
5/1 ARM - 3.125 % + 0 points for rate
7/1 ARM - 3.625% + 0 points for rate
10/1 ARM - 4.250% + 0 points cost for rate
The FEDERAL RESERVE took the extraordinary step of announcing that it was minded to keep the federal funds rate close to zero for at least two more years. It also restated that it was "prepared to employ" a "range of policy tools" if the economy worsens, which some think might include a third round of bond-buying.
As stock markets tumbled, the price of GOLD surged to trade above $1,800 a Troy Ounce, reaching parity with platinum prices for the first time since the end of 2008.
AMERICAN INTERNATIONAL GROUP (AIG) lodged a lawsuit against BANK OF AMERICA, claiming BofA sold it low-risk securities backed by "defective" mortgages given to low-income borrowers. It is one of the biggest claims so far to originate from the practices that led to the financial crisis; suits against other big banks are expected to follow.
30 year fixed - 4.125% + .0 points for rate
20 year fixed - 3.750% + .250 points for rate
15 year fixed - 3.250% + .250 points for rate
10 year fixed - 3.250% + 1.125 lender credit points for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.00% + 0 points for rate
FHA/VA
30 year fixed - 3.874% + .500 points for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.125 + .250 point for rate
Jumbo - over 625,500 - to 2,000,000 Fairfield County
30 year fixed - 4.750 % + 0 points for rate
15 year fixed - 4.250% + 0 points for rate
5/1 ARM - 3.125 % + 0 points for rate
7/1 ARM - 3.625% + 0 points for rate
10/1 ARM - 4.250% + 0 points cost for rate
Friday, August 5, 2011
#mortgage market update and rates this week
It would be hard to find another time frame of mortgage rate prices moving in a more volatile fashion than this week. In less than an hour on Friday morning, prices moved up 14 ticks to 2 day highs and then down 23 ticks to 2 day lows. On Friday morning stocks appear to be stalling and bouncing lower after failing to break 1220. Bonds like it. 10's are down to 2.462 now. Keep in mind that quoted levels in these updates continue to be moving targets.
U.S. job growth accelerated more than expected in July. This could ease fears the economy was sliding into a fresh recession. U.S. payrolls increased 117,000 above market expectations for an 85,000 gain. The unemployment rate dipped to 9.1 percent from 9.2 percent in June. The payrolls count for May and June was revised to show 56,000 more jobs added than previously reported The report was the first encouraging piece of economic data in some time. Economists see the odds of a recession as high as 40 percent. Top policy makers at the Federal Reserve will sift through the report when they meet on Tuesday but are not expected to announce any new measures to support the sputtering recovery. The U.S. central bank has cut interest rates to zero and spent $2.3 trillion on bonds. Policy makers have said they want to see how the economy fares before taking any further action.
The Best Execution conventional 30-year fixed mortgage rate has improved to 4.250%. Some lenders are even offering 4.00% but that quote carries with it additional closing costs. On FHA/VA 30 year fixed Best Execution is now 4.00% with some lenders willing to go as low as 3.875% (includes additional closing costs). 15 year fixed conventional loans are still best priced at 3.75% but we've seen very aggressive quotes at 3.625% too. Five year ARMs are still best priced at 3.25. ARMs and 15 year quotes seem to have bottomed out.
It's important to point out an increased amount of variation in what individual lenders are quoting as their Best Execution rates. This is a factor of price volatility in the secondary mortgage market. Unfortunately when volatility picks up in the secondary mortgage market, the cost of doing business gets more expensive for lenders (hedging costs go up). Those added costs are usually passed down to consumers via extra margin in rate sheets.
Reuters Reports - Wells Fargo & Co (WFC.N) plans to pay $590 million to settle a class action lawsuit. The 2009 class action case was filed in a federal court in New York City. Wachovia (now Wells Fargo) misrepresented its residential-mortgage holdings in offering documents during the lead-up to the financial crisis. The settlement is not expected to hurt Wells Fargo's financial position, it said in its quarterly filing with the U.S. Securities and Exchange Commission. Darren Robbins, a lawyer for the plaintiffs, said that auditor KPMG LLP, another defendant in the case, agreed to pay $37 million to settle the case, bringing the total recovery for plaintiffs to $627 million. Robbins said it would be the largest recovery in a case stemming from the credit crisis. In February, a federal judge in Los Angeles approved a $601.5 million settlement of a class action lawsuit against Countrywide Financial Corp over allegations it misled investors about its financial condition and lending practices. The settlements are subject to court approval. The case is In re: Wachovia Preferred Securities and Bond/Notes Litigation, U.S. District Court, Southern District of New York, No. 09-06351.
30 year fixed - 4.250% + .0 points for rate
20 year fixed - 3.750% + 0 points for rate
15 year fixed - 3.375% + 0 points for rate
10 year fixed - 3.250% + 1.125% lender credit points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.125% + 0 points for rate
FHA/VA
30 year fixed - 4.125% + 0 points lender credit for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.250 + .3750 lender credit for rate
Jumbo - over 729,000
30 year fixed - 4.875 % with 0 points for rate
15 year fixed - 4.375% + 0 points for rate
5/1 ARM - 3.250 % + 0 points for rate
7/1 ARM - 3.750% + 0 points for rate
10/1 ARM - 4.375% with + 0 points for rate
U.S. job growth accelerated more than expected in July. This could ease fears the economy was sliding into a fresh recession. U.S. payrolls increased 117,000 above market expectations for an 85,000 gain. The unemployment rate dipped to 9.1 percent from 9.2 percent in June. The payrolls count for May and June was revised to show 56,000 more jobs added than previously reported The report was the first encouraging piece of economic data in some time. Economists see the odds of a recession as high as 40 percent. Top policy makers at the Federal Reserve will sift through the report when they meet on Tuesday but are not expected to announce any new measures to support the sputtering recovery. The U.S. central bank has cut interest rates to zero and spent $2.3 trillion on bonds. Policy makers have said they want to see how the economy fares before taking any further action.
The Best Execution conventional 30-year fixed mortgage rate has improved to 4.250%. Some lenders are even offering 4.00% but that quote carries with it additional closing costs. On FHA/VA 30 year fixed Best Execution is now 4.00% with some lenders willing to go as low as 3.875% (includes additional closing costs). 15 year fixed conventional loans are still best priced at 3.75% but we've seen very aggressive quotes at 3.625% too. Five year ARMs are still best priced at 3.25. ARMs and 15 year quotes seem to have bottomed out.
It's important to point out an increased amount of variation in what individual lenders are quoting as their Best Execution rates. This is a factor of price volatility in the secondary mortgage market. Unfortunately when volatility picks up in the secondary mortgage market, the cost of doing business gets more expensive for lenders (hedging costs go up). Those added costs are usually passed down to consumers via extra margin in rate sheets.
Reuters Reports - Wells Fargo & Co (WFC.N) plans to pay $590 million to settle a class action lawsuit. The 2009 class action case was filed in a federal court in New York City. Wachovia (now Wells Fargo) misrepresented its residential-mortgage holdings in offering documents during the lead-up to the financial crisis. The settlement is not expected to hurt Wells Fargo's financial position, it said in its quarterly filing with the U.S. Securities and Exchange Commission. Darren Robbins, a lawyer for the plaintiffs, said that auditor KPMG LLP, another defendant in the case, agreed to pay $37 million to settle the case, bringing the total recovery for plaintiffs to $627 million. Robbins said it would be the largest recovery in a case stemming from the credit crisis. In February, a federal judge in Los Angeles approved a $601.5 million settlement of a class action lawsuit against Countrywide Financial Corp over allegations it misled investors about its financial condition and lending practices. The settlements are subject to court approval. The case is In re: Wachovia Preferred Securities and Bond/Notes Litigation, U.S. District Court, Southern District of New York, No. 09-06351.
30 year fixed - 4.250% + .0 points for rate
20 year fixed - 3.750% + 0 points for rate
15 year fixed - 3.375% + 0 points for rate
10 year fixed - 3.250% + 1.125% lender credit points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.125% + 0 points for rate
FHA/VA
30 year fixed - 4.125% + 0 points lender credit for rate
5/1 ARM - 2.750 + 0 points for rate
7/1 ARM - 3.250 + .3750 lender credit for rate
Jumbo - over 729,000
30 year fixed - 4.875 % with 0 points for rate
15 year fixed - 4.375% + 0 points for rate
5/1 ARM - 3.250 % + 0 points for rate
7/1 ARM - 3.750% + 0 points for rate
10/1 ARM - 4.375% with + 0 points for rate
Friday, July 29, 2011
30 Year Fixed @ 4.375% on 417,000 or less purchase #mortgage
The theme of volatility is ongoing. Loan pricing has moved in the opposite direction from the previous day for 6 sessions in a row now. The increases seen yesterday in home loan borrowing costs were erased the next day, leaving things slightly worse than average vs the last 2 weeks, but about middle of the road when comparing to the last month.
The only bet that has a decent probability of success in this environment is that no bets are clearly better than any others. This should continue to be the case until at least some semblance of resolution makes its way to the debt-ceiling debate. This makes for plenty of volatility in the meantime.
Rather than change rate sheets with each rapid movement in the secondary market, it's not only easier on all parties involved, but downright necessary for lenders to be extra conservative with rate sheet offerings.
The Federal Reserve plans to provide guidance to banks soon on how to handle the potentially turbulent financial waters if the United States exhausts its borrowing authority August 1. "We have been engaged in operational planning with the Treasury," Fed spokeswoman Barbara Hagenbaugh said on Thursday. "We expect to be able to give additional guidance to financial institutions when there is greater clarity from the Congress and when Treasury outlines its specific operational plans."
30 year fixed - 4.375% + .0 points for rate
20 year fixed - 4.00% + 0 points for rate
15 year fixed - 3.50% + 0 points for rate
10 year fixed - 3.250% + .705% lender credit points for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.125% + 0 points for rate
FHA/VA
30 year fixed - 4.250% + .500 points lender credit for rate
5/1 ARM - 2.875 + 0 points for rate
7/1 ARM - 3.250 + 0 point for rate
Jumbo - over 729,000
30 year fixed - 4.99 % with 0 points for rate
15 year fixed - 4.50% + 0 points for rate
5/1 ARM - 3.375 % + 0 points for rate
7/1 ARM - 4.00% + 0 points for rate
10/1 ARM - 4.50% with + 0 points for rate
The only bet that has a decent probability of success in this environment is that no bets are clearly better than any others. This should continue to be the case until at least some semblance of resolution makes its way to the debt-ceiling debate. This makes for plenty of volatility in the meantime.
Rather than change rate sheets with each rapid movement in the secondary market, it's not only easier on all parties involved, but downright necessary for lenders to be extra conservative with rate sheet offerings.
The Federal Reserve plans to provide guidance to banks soon on how to handle the potentially turbulent financial waters if the United States exhausts its borrowing authority August 1. "We have been engaged in operational planning with the Treasury," Fed spokeswoman Barbara Hagenbaugh said on Thursday. "We expect to be able to give additional guidance to financial institutions when there is greater clarity from the Congress and when Treasury outlines its specific operational plans."
30 year fixed - 4.375% + .0 points for rate
20 year fixed - 4.00% + 0 points for rate
15 year fixed - 3.50% + 0 points for rate
10 year fixed - 3.250% + .705% lender credit points for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.125% + 0 points for rate
FHA/VA
30 year fixed - 4.250% + .500 points lender credit for rate
5/1 ARM - 2.875 + 0 points for rate
7/1 ARM - 3.250 + 0 point for rate
Jumbo - over 729,000
30 year fixed - 4.99 % with 0 points for rate
15 year fixed - 4.50% + 0 points for rate
5/1 ARM - 3.375 % + 0 points for rate
7/1 ARM - 4.00% + 0 points for rate
10/1 ARM - 4.50% with + 0 points for rate
Friday, July 22, 2011
Rates and Market Updates
This week was filled with housing-related news. The modest pop in housing starts - new construction (led by multi family), was positive though most analysts believe that there is little reason to believe that the U.S. will see a real pickup in home construction any time soon. The most recent data from the Census Bureau shows 13.4 million vacant homes, roughly 3 million above a normal market. Much of this is from the big increase in vacancies that we saw in 2005-2006 when overbuilding hit its peak. The fastest-growing category of vacancies is in homes that the owner would like to sell or rent but are currently "held off"the market, and it is yet another form of shadow inventory that will eventually have to be absorbed.
We also had the FHA Home Price Index increase by .4% in May, the second consecutive monthly increaseand better than the expected 0.1% increase. April's results were revised downward to a 0.2% increase from an initial estimate of a 0.8%increase. Year over year, home prices were still down 6.3%, and the index remains 19.6% below its peak in April 2007 and roughly equal to the level of January 2004.
Rates crept up during the latter half of the week, mostly due to speculation that Greek bonds will receive some type of European guarantee. Just as investors move money during a "flight to safety," they move it out again when risk is reduced - and that is what we saw Thursday. The EU side of the debt drama appeared to be making some progress as opposed to the US debt ceiling impasse. The 10-yr closed at 3.01%,and traders reported higher selling of mortgage-backed securities on the sell-off. There are no economic releases scheduled for today, Friday July 22. The markets will stay focused on the deals being reached in Europe and in the US with an eye on what our stock market is doing.
An apparent consequence of Dodd Frank, MetLife Bank is for sale - but not the mortgage company. In a quote that tells it all, "MetLife Bank represented just two percent of MetLife Inc.'s first quarter 2011 operating earnings, and we do not believe it is appropriate for the overwhelming majority of our business to be governed by regulations written for banking institutions," said Steven Kandarian, president and chief executive officer of MetLife Inc. MetLife Inc. said that it is considering the sale of its Met Life Bank N.A.'s depository business and eliminating the company's status as a bank holding company. The firm said it will still offer residential mortgages through its MetLife Home Loans business.
30 year fixed - 4.50% + 0 cost points for rate
20 year fixed - 4.250% + 0 points for rate
15 year fixed - 3.625% + .50 points for rate
10 year fixed - 3.250% 0 cost points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.250% + 0 points for rate
FHA/VA
30 year fixed - 4.375% with 0 points for rate
5/1 ARM - 3.00 with 0 points for rate
7/1 ARM - 3.50 with 0 point for rate
Jumbo - over 729,000
30 year fixed - 4.99 % with +.50 points for rate
15 year fixed - 4.625% + .250 cost points for rate
5/1 ARM - 3.50% - 0 points for rate
7/1 ARM - 4.00% - 0 points for rate
We also had the FHA Home Price Index increase by .4% in May, the second consecutive monthly increaseand better than the expected 0.1% increase. April's results were revised downward to a 0.2% increase from an initial estimate of a 0.8%increase. Year over year, home prices were still down 6.3%, and the index remains 19.6% below its peak in April 2007 and roughly equal to the level of January 2004.
Rates crept up during the latter half of the week, mostly due to speculation that Greek bonds will receive some type of European guarantee. Just as investors move money during a "flight to safety," they move it out again when risk is reduced - and that is what we saw Thursday. The EU side of the debt drama appeared to be making some progress as opposed to the US debt ceiling impasse. The 10-yr closed at 3.01%,and traders reported higher selling of mortgage-backed securities on the sell-off. There are no economic releases scheduled for today, Friday July 22. The markets will stay focused on the deals being reached in Europe and in the US with an eye on what our stock market is doing.
An apparent consequence of Dodd Frank, MetLife Bank is for sale - but not the mortgage company. In a quote that tells it all, "MetLife Bank represented just two percent of MetLife Inc.'s first quarter 2011 operating earnings, and we do not believe it is appropriate for the overwhelming majority of our business to be governed by regulations written for banking institutions," said Steven Kandarian, president and chief executive officer of MetLife Inc. MetLife Inc. said that it is considering the sale of its Met Life Bank N.A.'s depository business and eliminating the company's status as a bank holding company. The firm said it will still offer residential mortgages through its MetLife Home Loans business.
30 year fixed - 4.50% + 0 cost points for rate
20 year fixed - 4.250% + 0 points for rate
15 year fixed - 3.625% + .50 points for rate
10 year fixed - 3.250% 0 cost points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.250% + 0 points for rate
FHA/VA
30 year fixed - 4.375% with 0 points for rate
5/1 ARM - 3.00 with 0 points for rate
7/1 ARM - 3.50 with 0 point for rate
Jumbo - over 729,000
30 year fixed - 4.99 % with +.50 points for rate
15 year fixed - 4.625% + .250 cost points for rate
5/1 ARM - 3.50% - 0 points for rate
7/1 ARM - 4.00% - 0 points for rate
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