The Improving Mortgage Rates at a closer glance

We can all breathe a bit easier going into the weekend after we saw the stock market bounce back late Friday and end on a positive note after watching the market sell off dramatically all week!   The good news to us in the Real Estate profession when the stock market sells off, investors look for safety in treasuries which allows for mortgage rates to improve.  

30 year fixed rates were averaging 4.75 to 4.875%, on Friday (average because final rates are based upon loan program, loan to value and credit scores).

With the senate passing there version of financial reform…it looks like we could see a bounce in equities this week which could push rates back to those 5.00% levels once again.

One thing that is very clear with the senate’s version are the days of qualifying for mortgage loans with little to no documentation could be over for good.   They made it very clear that lenders must consider an applicant’s income, assets and credit history when determining whether someone can qualify for a mortgage loan!   Seems to make sense, however this was clearly stated in the bill.

Over-all rates continue to remain low and do not look to increase dramatically anytime soon…so this will allow for buyers to purchase homes at historically low rates, even though the tax credit has expired!

Have a great weekend.

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Market Update-Interest Rates

 

Not a great week for the stock market, however the good news is that on Friday afternoon the market reversed its downward trend and ended back up over 10,000 by the close.   This could be a good sign going into Monday’s trading as buyers came back into the market at the end of the day!
 
The same could be said for the Real Estate market…many first time buyers are now beginning to call again, in order to take advantage of the tax credit program.
 
Rates continue to stay very low…conventional loans averaging 4.875 to 5.00% and FHA/VA rates averaging 5.00 to 5.125%
 
I say average as there are so many more components that go into an interest rate today; such as credit score, down payment and loan to value…however no matter what an individual buyer’s situation rates are still at historical lows!
 
Many are concerned with all of the regulatory changes and that it will take much longer to close a transaction, however you can still close a loan in 3 to 4 weeks (or less) if it is done right and disclosed properly…we just closed a VA loan last month in less than three weeks…so closing times really have not increased like many had thought and predicted.
 
Have a great weekend!

Changes to HUD homes for buyers-

HUD BUYER AND BROKER INCENTIVES DISCONTINUED
  Effective February 12,2010, any properties listed and/or sold with FHA financing as of this date are no longer eligible for the $100 down payment incentive.

The Sales Allowance of $2500 for owner occupant purchasers will also be discontinued as of February 12, 2010 for all new contracts accepted on or after this date.

The $500 broker bonus for owner occupant purchasers who took advantage of the $2500 sales allowance is also discontinued as of February 12, 2010. 

Market Update-Lenders changing HUDs rehab guidelines

 

In an effort to help move foreclosed properties more quickly HUD announced on Friday the removal of 90 day waiting period to repurchase homes utilizing FHA financing!
 
This information just came out yesterday and more details to follow…however the following is a quick review;
 
–  Effective February 1st, 2010
–  All transactions must be arms-length in nature
–  Seller must hold title to the property
–  No previous flipping of the property during the last 12 months
–  Property was marketed openly and fairly
 
Key issue will be when property has increased 20% or more since title transferred;
 
–  Supporting documentation will need to verify sufficient legitimate renovation or appraiser needs to justify and explain increase in value
–  Property inspection will be required by lender
 
Again, this just was announced…please see attached from HUD and as I have more details will forward to everyone.

Published in: on January 19, 2010 at 07:00  Leave a Comment  
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