National mortgage rates on 30-year fixed mortgages climbed 1 basis point from 4.25% to 4.26% on September 2, 2010, according to Zillow Mortgage Marketplace. As a comparison, state rates ranged from a low of 4.15% (UT) to a high of 4.50% (NV).

Compared to the week prior to September 2, 2010, the national 30-year mortgage rate is down 1 basis points from 4.27%. Compared to three months ago, the 30-year rate is down 42 basis points from its average rate of 4.68%.

The average rate on a 30-year fixed mortgage hit 4.44 percent this week, mortgage buyerFreddie Mac said Thursday. And some brokers say homeowners looking to refinance have even managed to do so for as low as 4 percent.

Still, cheap rates have done little to boost the struggling housing market. Instead, they are highlighting investors’ fears that the rebound is stalling and the country could be slipping back into a recession.

Investors are shifting their money away from stocks and into safer Treasury bonds. That is sending Treasury yields lower. Mortgage rates track those yields.

And the Federal Reserve is pushing those yields down even further. The central bank said Tuesday it would buy Treasurys to help aid the recovery, using the proceeds from debt and mortgage-backed securities it bought from Fannie Mae and Freddie Mac.

That move alone is unlikely to push average rates down to 4 percent, said Bob Walters, chief economist at Quicken Loans. But average rates that low are still a possibility if the economic outlook worsens even further.

“The silver lining to a bad economy is that interest rates fall,” Walters said. “If you can lower your debt burden by refinancing, that’s great.”

Up to now, low rates have failed to spark a struggling housing market. Slow job growth, a 9.5 percent unemployment rate and tight credit standards have kept people from buying homes. Applications to refinance have grown but remain well short of a massive boom.

Overall home loan applications rose only 0.6 percent last week from a week earlier, the Mortgage Bankers Association said Wednesday.

For those homeowners with solid finances, the opportunity to refinance below 4 percent is persuading some to consider 15-year fixed loans. Those average rates dropped to 3.92 percent, down from 3.95 percent last week and the lowest in decades.

More homeowners are choosing that option because it allows them to save money in the long run, though it costs more in monthly payments. Freddie Mac says nearly a third of borrowers refinancing 30-year loans in the April-to-June picked loans with 15-year or 20-year terms.

Still, savvy consumers can already find 30-year fixed rates at or near 4 percent if they are willing to pay a little more upfront.

Chik Quintans, assistant sales manager with Atlas Mortgage in Seattle, said he was able to get two clients into mortgages with a 4 percent interest rate and a fee of 1 percent of the total mortgage amount on Wednesday. But rates have inched up since then.

“Every day’s different,” Quintans said. “Sometimes people have to ruminate, and then the opportunity’s gone.”

Refinancing could pick up significantly if rates fall further. An average rate below 4.375 percent could be enough of a drop so that many people who refinanced last year could shave a half of a percentage point of their mortgage rates, said Scott Buchta, chief mortgage strategist with Braver Stern Securities.

Lenders could find themselves in a bind if traffic picks up, Buchta said. Many have laid off thousands of workers over the past three years and don’t have enough staff to handle a crush of new applications.

Mortgage rates often fluctuate significantly, even within a given day. To calculate the national average, Freddie Mac collects mortgage rates on Monday through Wednesday of each week from about 125 banks, thrifts and credit unions around the country in a voluntary survey.

Rate quotes from parts of the country with more lending activity—such as the West and Northeast—are given more weight in creating the average.

Rates on five-year adjustable-rate mortgages averaged 3.56 percent, down from 3.63 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.53 percent from 3.55 percent.

The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac’s survey averaged 0.7 a point for all loans except for 15-year mortgages, which averaged 0.6 of a point.

URL: http://www.cnbc.com/id/38674782/

National mortgage rates on 30-year fixed mortgages remained stable at 4.29% on August 15, 2010, according to Zillow Mortgage Marketplace. As a comparison, state rates ranged from a low of 4.20% (HI) to a high of 4.46% (NV).

Compared to the week prior to August 15, 2010, the national 30-year mortgage rate remained stable at 4.29%. Compared to three months ago, the 30-year rate is down 48 basis points from its average rate of 4.77%.

Rates on the 30-year mortgage dropped to a record low in the past week, according to a survey released Thursday by Freddie Mac, as concerns mounted about the economic recovery.

Rates on 30-year fixed-rate mortgages, the most widely used loan, averaged 4.57 percent for the week ended July 8, down from the previous week’s 4.58 percent and 5.20 percent a year earlier, according to the survey, which started in April 1971.

“With mortgage rates falling to historic lows, refinance activity has been strong over the past three months,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

Freddie Mac is the second-largest U.S. mortgage finance company.

While low rates and high affordability have helped the housing market gain ground, it has struggled in recent months given stubbornly high unemployment and mounting foreclosures.

Freddie Mac said the 15-year fixed-rate mortgage averaged 4.07 percent, up from 4.04 percent last week.

Mortgage rates are linked to yields on Treasuries and yields on mortgage-backed securities.

URL: http://www.cnbc.com/id/38146897/

1. Don’t buy if you can’t stay put.

If you can’t commit to remaining in one place for at least a few years, then owning is probably not for you, at least not yet. With the transaction costs of buying and selling a home, you may end up losing money if you sell any sooner – even in a rising market. When prices are falling, it’s an even worse proposition.

2. Get your credit checked.

Since you most likely will need to get a mortgage to buy a house, you must make sure your credit history is as clean as possible. A few months before you start house hunting, consult a mortgage professional to examine your credit with you.  See if there are any credit issues that can be resolved before looking for a home.

3. Aim for a home you can really afford.

The rule of thumb is that you can buy housing that runs about two-and-one-half times your annual salary. But you’ll do better to use one of many calculators available online to get a better handle on how your income, debts, and expenses affect what you can afford.

4. If you can’t put down the usual 20 percent, you may still qualify for a loan.

There are a variety of programs available to home buyers with little to no money down, consult with your mortgage professional to see what programs you can qualify for.

5. Buy in a district with good schools.

In most areas, this advice applies even if you don’t have school-age children. Reason: When it comes time to sell, you’ll learn that strong school districts are a top priority for many home buyers, thus helping to boost property values.

6. Get professional help.

Even though the Internet gives buyers unprecedented access to home listings, most new buyers (and many more experienced ones) are better off using a professional agent. Look for an exclusive buyer agent, if possible, who will have your interests at heart and can help you with strategies during the bidding process.

7. Choose carefully between points and rate.

When picking a mortgage, you usually have the option of paying additional points — a portion of the interest that you pay at closing — in exchange for a lower interest rate. If you stay in the house for a long time — say three to five years or more — it’s usually a better deal to take the points. The lower interest rate will save you more in the long run.

8. Before house hunting, get pre-approved.

Getting pre-approved will you save yourself the grief of looking at houses you can’t afford and put you in a better position to make a serious offer when you do find the right house. Not to be confused with pre-qualification, which is based on a cursory review of your finances, pre-approval from a lender is based on your actual income, debt and credit history.

9. Do your homework before bidding.

Your opening bid should be based on the sales trend of similar homes in the neighborhood. So before making it, consider sales of similar homes in the last three months. If homes have recently sold at 5 percent less than the asking price, you should make a bid that’s about eight to 10 percent lower than what the seller is asking.

10. Hire a home inspector.

Sure, your lender will require a home appraisal anyway. But that’s just the bank’s way of determining whether the house is worth the price you’ve agreed to pay. Separately, you should hire your own home inspector, preferably an engineer with experience in doing home surveys in the area where you are buying. His or her job will be to point out potential problems that could require costly repairs down the road.

With the long-awaited rebound in job creation finally underway and poised to move into high gear, you’d think the time had finally come for the Fed’s hawks to have their way with the central bank’s monetary policy.

Think again. It’s a big world out there, even for the Fed.

Even if May’s nonfarm payrolls report Friday shows a half-million gain as expected, Chairman Ben Bernanke and like thinkers at the Fed will have plenty of other reasons to stay the course at the policy meeting June 22-23.

So while regional Fed presidents such as Dennis Lockhart Thursday talked about higher rates down the road, the Fed boss himself shied away from monetary policy in his remarks.

Not that investors and economists needed much in the way of hints.

“There’s too many worries, too much uncertainty,” says James Awad, citing a litany of negatives from Europe’s debt crisis and subsequent austerity measures, the inflation-deflation see-saw, the Gulf oil spill and the stock market pullback.

He might have included a slowing housing market rebound, which some consider a precursor to a double-dip real estate recession, and rising Libor rates, a particularly ominious and resonant sign after the dark days of the financial crisis in 2008.

Given all that, economists say the Fed will keep its famous language about how “economic conditions…are likely to warrant exceptionally low levels of the federal funds rate for an extended period.”

In the current environment, the less famous, or second shoe of sorts, that has appeared routinely in the FOMC statement, is equally important:

“The committee will continue to monitor the economic outlook and financial developments and will employ its policy tools as necessary to promote economic recovery and price stability.

“To keep that language longer would seem to me to be a pretty appropriate action,” says veteran Fed-watcher David Jones–especially in the current environment.

Jones points to a May 11 speech of outgoing Fed Vice-Chairman Donald Kohn, who said: “By noting that the federal funds rate was likely to remain at “exceptionally low” levels for an “extended period,” the FOMC likely was able to keep long-term interest rates lower than would otherwise have been the case. ”

Among other things, it’s another kind of support for the housing market–especially after the end of the Fed’s massive mortgage-back-securities purchase program in March.
# Complete Politics & Economics Coverage

It also helps foster the the carry trade. which despite its demerits privides a kind of liquidity.

More importantly, and specifically, at the moment, “it’s the perfect way to help cushion our long-term rates from pressure caused by the Euro-Zone sovereign debt crisis,” says Jones.

In sum, events since the last FOMC meeting April resemble a one step forward, two steps back situation.

“There’s a general sense the European banking system is not functioning very well,” says hedge fund managing director Ram Bhagavatula of Comibinatorics Capital, citing a recent panel discussion with other Wall Street economists.

He cites weak commercial bank interest in a special dollar-based lending facility set up by the Fed and the central banks of Europe May 9 meant to increase liquidity, and their difficulty in finding term funding beyond a daily or monthly basis.

“While it may sound like mechanics, it creates uncertainty,” adds Bhagavatula. “June 22-23 is not late enough for these issues to be resolved.”

If so, and with any inter-meeting move pretty much out of the question, the next chance is the August 10 meeting, which may also be enough time for the jobless rate–hovering around 10 percent over the last nine months–to be on a consistent, downward path.

Jones, for one, expects a tell-tale change in language in August, followed by the Fed’s first rate hike, as early as the September 21 meeting, which is similar to the two-step approach it took in the spring of 2003 during the recovery from the brief 2001 recession.

“They might wait till the last minute,” says Jones. “The markets are going to be surprised by how serious the Fed gets in executing its exit strategy.”

How an increasingly impatient market takes such a timeline is, of course, very uncertain, but low rates can be a stigma as much as they can be stimulative; though the Fed recently upped its growth forecast, it’s easy to associate low rates with the risk of deflation as much as low inflation and that can hold back an expansion.

Skeptics say handicapping aside there is one takeaway for the markets.

“The Fed does not have a history of pre-emptive policy,” says Bhagavatula. “Nothing is pushing it.”
© 2010 CNBC.com

URL: http://www.cnbc.com/id/37485477/

U.S. mortgage rates continued their downward trek in the past week, edging closer to a record low set in early December, according to a survey released on Thursday by Freddie Mac, the second-largest U.S. mortgage finance company.

Lower interest rates on mortgages should buoy home loan refinancing activity, putting more cash into consumers’ hands to funnel into the U.S. economy. It also makes homes more affordable during the most important period, the spring selling season.

Interest rates on U.S. 30-year fixed-rate mortgages, the most widely used loan, averaged 4.78 percent for the week ended May 27, down from the previous week’s 4.84 percent, according to the survey.

That is below the year-ago level of 4.91 percent and also the lowest the rate has been since the week ended Dec. 3, 2009 when it hit a record low of 4.71 percent. Freddie Mac started the survey in 1971.

“These low rates will help to elevate home-buyer affordability and soften the effects of the sunset of the home-buyer tax credit,” Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

Mortgage rates are linked to yields on Treasuries and yields on mortgage-backed securities.

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Calculators and Advice from Bankrate.com:

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URL: http://www.cnbc.com/id/37376985/

WASHINGTON, May 21, 2010 /PRNewswire via COMTEX/ — While America has been suffering through an unprecedented crisis in housing loan defaults, the VA Home Loan Guaranty Program has remained healthy.

“The American Legion has been very pleased to watch the performance of VA loans during the unprecedented downturn in the mortgage marketplace over the last two and a half years,” said Joe Sharpe, the Legion’s economic division director.

Sharpe testified on VA’s home loan program May 20 before the House Subcommittee on Economic Opportunity, chaired by Rep. Stephanie Herseth Sandlin, D-S.D.

According to The Mortgage Bankers Association, the delinquency rate for subprime loans stands at 30 percent, while only 5 percent of veterans have defaulted on their VA home loans. The prime loan delinquency rate is 7 percent while FHA defaults stand at about 9 percent.

“This data clearly shows that VA loans are performing better than all other mortgage loan types in the marketplace,” Sharpe told the subcommittee. He attributed such favorable performance to several factors: While other lenders compromised their standards to generate more business, VA has maintained its prudently crafted credit underwriting standards.

VA selects home appraisers from its own approved list; it does not allow lenders to choose appraisers, as is common in the mortgage industry.

VA has an aggressive and comprehensive program to help veterans who are unable to make loan payments.

Veterans and servicemembers are usually more responsible borrowers because of discipline and maturity developed through their military service.

One problem The American Legion wants to eliminate is VA’s current practice of charging veterans a “funding fee” that was introduced in 1982. “Unfortunately, this fee has become a fixture of the home loan program and – even more unfortunately – it has been raised numerous times by Congress,” Sharpe said.

Currently, veterans using the program for the first time must pay 2.15 of the loan amount and 3.3 percent for the second time (i.e., $4,300 or $6,600 for a $200,000 loan).

Sharpe told the subcommittee that The American Legion wants Congress “to consider either eliminating this fee or significantly reducing it.

“Veterans should not have to make such a significant financial sacrifice in order to use a benefit that they have earned as a result of their service to America,” he said.

The American Legion also wants VA’s home loan program extended to the spouses of deceased veterans – regardless of what maladies they died from. “It is unfair for a veteran’s spouse only to become eligible for the home loan if a veteran dies of a service-connected disability,” Sharpe said.

The VA home loan program has had a resurgence since fiscal 2007, when it guaranteed only 137,297 loans. Sharpe noted that VA guaranteed 325,673 home loans in fiscal 2009. “It looks like VA is on track to match last year’s high volume during fiscal year 2010,” he said.

The substantial increase in VA home loans can be partially attributed to the fact that other lenders stopped offering riskier “no down payment” packages once the mortgage crisis hit, Sharpe explained.

Another reason VA’s home loan program has gained more customers is because it now uses automated underwriting systems that are preferred by lenders, Sharpe told the subcommittee. These systems reduce significantly the time needed to process a loan application, and VA has maintained the integrity of its underwriting process by requiring its own standards to be written into the systems’ software.

SOURCE The American Legion www.prnewswire.com Copyright (C) 2010 PR Newswire. All rights reserved -0- KEYWORD: District of Columbia INDUSTRY KEYWORD: FIN

LOS ANGELES, May 21, 2010 /PRNewswire via COMTEX/ — One of the most frequent objections to the payday lending industry from opponents is that the APRs (Annual Percentage Rate) are “too-high.” Those who stand so strongly against the payday loan industry have usually never taken out a payday advance, and do not understand how to calculate an APR. Some will claim that they do not need to know how to calculate an APR, and that “everyone knows” APRs of 400% and up are just “wrong” or “evil.” Let’s take a look for ourselves! APR stands for “Annual Percentage Rate.” It helps to understand a bit about how these numbers can fluctuate greatly depending on how long the loan is given; especially when these “Annual” ratings are applied to short-term loans. You can use an online payday loan calculator or you can calculate it yourself.

The basic formula to calculate an APR on a Payday Loan is: APR = ((Interest Rate/Amount Borrowed) * (Days in a Year/Days in term of contract)) * 100 For example, if you borrowed $100 with $15 charged, for two weeks the calculation would look like…

First, we have to calculate $15/$100, which is .15 Then, we calculate 365/14, which is 26.071 (cutting out several digits to simplify) Now, multiply .15 * 26.071, which comes to 3.91065 and rounds up to 3.9107 Multiply that by 100 to get the actual percentage of 391.07%, or as the formula would look….

(($15/$100) * (365 days/14 days))*100 = APR of 391.07% On this next example below, I’m using an online long term APR calculator.

Below, I’m calculating what 3.6% APR would be for 30 years on a $100,000 loan.

It ends up adding roughly 63% of the original amount borrowed.

WOW!! Only 3.6% APR ends up being 63% of the original amount financed, on this standard 30 year loan (mortgage) scenario! Which means you’re probably asking yourself, “If that situation is only 3.6% APR, why does over 391% APR only end up being $15 for $100 borrowed?” The answer lies within the time-frame, or the amount of time the money is borrowed. Due to the “truth-in-lending” act, nearly all lenders MUST disclose the APR in writing to the borrower. Unfortunately, when used on a short-term loan, APR’s can increase greatly when the term is decreased.

Hopefully this will help you to form your own opinion next time you read about Payday Loan APRs being “too-high.” SOURCE Pay1Day.com www.prnewswire.com Copyright (C) 2010 PR Newswire. All rights reserved -0- KEYWORD: California INDUSTRY KEYWORD: FIN SUBJECT CODE: SVY

Copyright: CNBC

This year the interest rates were suppose to be on the raise. Now with the turmoil in the world markets rates are falling. Currently in today’s market rates on a 30 year fixed rate mortgage is 4.49% (4.61% APR). Contact me today to take advantage of these rates 570-348-9353