St. Louis Mortgage Rate Update; Housing Scorecard Finds Promise in Recent Market Data

The U.S. Department of Housing and Urban Development and the U.S. Department of the Treasury released their May Housing Scorecard, which collects key market data and tracks the administration’s recovery efforts. According to the May scorecard, recent market data contains a number of promising indicators and increasing signs of stability. In April, sales of existing homes increased in every region of the country and the number of new homes rose for the first time since 2007. Continue reading “St. Louis Mortgage Rate Update; Housing Scorecard Finds Promise in Recent Market Data

St. Louis Mortgage Rate Update; It’s not over till it’s over

How can a fully approved loan get denied for funding after the borrower has signed loan docs?

And then it happens.  The underwriter runs a new credit report just before closing and it turns out the prospective borrower had run up a credit card balance, buys new furniture/appliances etc. and now the new debt kills the loan.

If you are serious about buying or refinancing a home, be conscientious about your obligations and credit.   The following is a quick rundown of issues that come up at the last minute and either delay or kill a closing. Continue reading “St. Louis Mortgage Rate Update; It’s not over till it’s over

St. Louis Mortgage Rate Update; Do I need to sell my home to buy another?

MAYBE…Many of my clients and prospects outgrow their current home, or relocate due to a job transfer.  Regardless of the motivation for keeping one property while purchasing another, let’s address this question with the mortgage approval in mind:

Do I Have To Sell? No you do not have to sell if you are in a financial position where you qualify, i.e. Debt-to-Income Ratio is satisfactory and on paper you can afford both your current residence and the proposed payment on the new home.  However, the borrower in this case must give consideration to other or additional expenses when maintaining multiple properties…increased property taxes, insurance costs, maintenance, un-expected repairs when making that decision. Continue reading “St. Louis Mortgage Rate Update; Do I need to sell my home to buy another?

St. Louis Mortgage Rate Update; "You’ll never buy at the bottom" Interest rates are on the rise

Mortgage rates have been rising nonstop since the end of last week. If you are considering a refinance or taking the plunge and buying a new home, you’d better get moving.   I just had a prospect shop rates and terms for his new home over the last couple of weeks and just called back; he finally decided on a lender and wanted an updated rate quote to lock his loan. Needless to say,  he was terribly disappointed…the rates we originally spoke about on a 30 year fixed rate a couple of weeks ago was in the high 3’s, my quote yesterday was 4.25% (4.45% APR ). Continue reading “St. Louis Mortgage Rate Update; "You’ll never buy at the bottom" Interest rates are on the rise

Mortgage Rates Finish 2011 Near Historic Lows

Dennis Norman St Louis Realtor, mortgage ratesFreddie Mac released the results of its Primary Mortgage Market Survey® (PMMS), showing average fixed mortgage rates finishing the year near their all-time historic lows. Thirty-year fixed rate mortgages averaged 3.95 percent and have been at or below 4.0 percent for the past nine consecutive weeks keeping homebuyer affordability at a near all-time high. Continue reading “Mortgage Rates Finish 2011 Near Historic Lows

30-Year Fixed-Rate Mortgage Matches All-Time Record Low at 3.94 Percent

This morning Freddie Mac released its Primary Mortgage Market Survey (PMMS) which showed average 30-year fixed-rate mortgages matched an all time record low of 3.94 percent, and there was an all-time record low rate for 15-year fixed rate mortgages. Continue reading “30-Year Fixed-Rate Mortgage Matches All-Time Record Low at 3.94 Percent

St. Louis Mortgage Rate Update; The Benefits of ARM’s

Even though over the past few years, ARM’s (adjustable rate mortgages) have received somewhat of a “bad name”, there are truly benefits to them including:

  • ARM rates are now more attractive than ever before.
  • Rates have fallen to 2.50% for a 5/1 ARM.
  • ARM’s are predictable.
  • Rates are capped so there are no surprises for borrowers.
  • Rates adjust only on the remaining principal of the loan.
  • Rate adjustments could decrease (increases are limited to the prevailing index in which the ARM is based).
  • Lower Monthly Payments – Increases the buying power of borrowers which attracts buyers to new homes. Continue reading “St. Louis Mortgage Rate Update; The Benefits of ARM’s

What does 2010 hold in store for the Housing Market?

Dennis Norman

In a just a few days we will say goodbye to 2009; a year that has been brutal to the housing market. So as the new year comes in, what will 2010 hold in store for the housing market?

To answer this question I turned to the housing forecast just released by Fannie Mae to see what their economists were predicting. Here are the highlights from the report, showing actual numbers for the 3rd quarter of this year as well as Fannie Mae’s projection for 4th quarter of this year as well as 4th quarter of 2010:

  • New Home Starts (seasonally adjusted annual rate)
    • 3rd quarter actual- 499,000
    • 4th quarter 09 projection – 502,000 (+0.06 % from 3rd quarter)
    • 4th quarter 10 projection – 650,000 ( +29.4% from the year before)
  • New Home Sales (seasonally adjusted annual rate)
    • 3rd quarter actual- 413,000
    • 4th quarter 09 projection – 442,000 (+7.02 % from 3rd quarter)
    • 4th quarter 10 projection – 510,000 ( +15.38% from the year before)
  • Existing Home Sales (seasonally adjusted annual rate)
    • 3rd quarter actual- 5,290,000
    • 4th quarter 09 projection – 5,623,000 (+6.29 % from 3rd quarter)
    • 4th quarter 10 projection – 5,492,000 ( -2.32% from the year before)
  • Median Home Prices-New Homes
    • 3rd quarter actual- $210,400
    • 4th quarter 09 projection – $214,600 (+2.0 % from 3rd quarter)
    • 4th quarter 10 projection – $211,400 (-1.5% from the year before)
  • Median Home Prices-Existing Homes
    • 3rd quarter actual- $178,300
    • 4th quarter 09 projection – $175,200 (-1.73 % from 3rd quarter)
    • 4th quarter 10 projection – $172,600 (-1.48% from the year before)
  • Mortgage Interest Rates (fixed-rate mortgage)
    • 3rd quarter actual- 5.16 percent
    • 4th quarter 09 projection – 4.88 percent
    • 4th quarter 10 projection – 5.32 percent

So there you have it. A somewhat encouraging forecast for the housing industry for next year. A prediction of increased new home sales, a little bump in existing home sales at the end of this year (from the homebuyer tax credit no doubt) and then a slight drop in sales next year from that rate, a slight drop in home prices in the next year and interest rates that are still attractive. If all this pans out 2010 will no doubt end up being a kinder year to the housing industry than 2009 was.

Ah, but wait…I know what you’re thinking…same thing as me. What do these guys know? After all wasn’t it Fannie Mae that had accounting issues, management problems and has been blamed by some to be a contributor to the housing bust? Well, lets take a look at their housing forecast from a year ago and how accurate their projections were then. For the sake of this comparison we will compare their forecast for the 3rd quarter of 2009 with the actual numbers from above:

  • New Home Starts (seasonally adjusted annual rate)
  • 3rd quarter 2009 actual- 499,000
  • 3rd quarter forecast – 526,000 (over by 5.41%)
  • New Home Sales (seasonally adjusted annual rate)
  • 3rd quarter2009 actual- 413,000
  • 3rd quarter forecast – 472,000 (over by 14.29%)
  • Existing Home Sales (seasonally adjusted annual rate)
  • 3rd quarter 2009 actual- 5,290,000
  • 3rd quarter forecast – 5,003,000 (under by 5.42%)
  • Median Home Prices-New Homes
  • 3rd quarter 2009 actual- $210,400
  • 3rd quarter forecast – $208,600 (under by 0.85%)
  • Median Home Prices-Existing Homes
  • 3rd quarter 2009 actual- $178,300
  • 3rd quarter forecast – $186,600 (over by 4.66%)
  • Mortgage Interest Rates (fixed-rate mortgage)
  • 3rd quarter 2009 actual- 5.16 percent
  • 3rd quarter forecast – 5.44 percent (over by 5.42%)
  • Considering all the factors that affect the housing market I actually think Fannie Mae did pretty good in their forecast last year. They overshot new home sales a fair amount but undershot existing home sales by a much smaller percentage. Overall on combined home sales they got within 4% of predicting the number of sales. I also think they did pretty good on median home prices.

    So, since Fannie Mae’s projections last year were fairly accurate lets hope the current projections will prove to be as well. If so, then it will be clear that the worst is behind us.

    Mortgage rates decline this week on better than expected economic news

    Dennis Norman

    Dennis Norman

    According to Freddie Macs weekly mortgage market survey mortgage rates decreased slightly for the week ending August 6, 2009 from the prior week. The survey shows 30 year fixed rate mortgages averaging 5.22% with 0.6% in fees and points, down from 5.25% the week before. Last year at this time, the 30 year rate averaged 6.52%.

    Rates on 15 year fixed-rate mortgages decreased slightly as well, down to 4.63% from 4.69% the week before, 5/1 ARM’s held about the same at 4.73% and 1 year ARM’s as well as 4.78%. This time last year these arms were 6.05% and 5.22% respectively.

    Missouri is included in the southwest region on Freddie Mac’s survey and rates in our region were pretty consistent with the national averages reported above for fixed rate loans, however 5/1 arms in our region averaged only 4.64% compared with 4.73% nationally, and 1/1 arms in our region were 5.05%, quite a bit above the national average of 4.78%.

    “Better-than-expected economic reports helped to keep mortgage rates low this week,” said Frank Nothaft, Freddie Mac vice president and chief economist. “The economy slowed by an annual rate of 1 percent in the second quarter, which was more positive than market forecasts.”

    Interest rates increase slightly this week

    Dennis Norman

    Dennis Norman

    According to Freddie Macs weekly mortgage market survey mortgage rates increased slightly this week from the prior week. The survey shows 30 year fixed rate mortgages averaging 5.20% with 0.7% in fees and points, up from 5.14% the week before. Last year at this time, the 30 year rate averaged 6.63%.

    Rates on 15 year fixed-rate mortgages increased slightly as well, up to 4.68% from 4.63% the week before, 5/1 ARM’s held about the same at 4.74% and 1 year ARM’s as well as 4.76%. This time last year these arms were 6.18% and 5.49% respectively.

    30 year mortgage rates this week at 5.14%; lowest since May

    Dennis Norman

    Dennis Norman

    By: Dennis Norman

    Freddie Macs weekly mortgage market survey mortgage rates dropped this past week, making it the third week in a row rates came down.  

    The survey shows 30 year fixed rate mortgages averaging 5.14% with 0.7% in fees and points, down from 5.20% the week before. This is the lowest rate reported in Freddie Mac’s survey for a 30 year fixed rate loan since May. Rates on 15 year fixed-rate mortgages dropped very slightly as well, down to 4.63% from 4.69% the week before, 5/1 ARM’s held about the same at 4.83% and 1 year ARM’s dropped from 4.82% to 4.78%.

    “Average fixed-rate mortgage rates were lower than last week and were down 0.4 percent to 0.5 percent from the levels of early June.,” said Frank Nothaft, Freddie Mac vice president and chief economist. “For a 30-year fixed-rate mortgage, the rate reduction over the past five weeks translates into a monthly payment saving of $56 on a $200,000 loan.