Mortgage Rates Still Dropping, Hit New Lows

Fixed mortgage rates inched down again for the fourth consecutive week, bringing them to new lows in early 2015.

Averaging 3.63%, the 30-year fixed-rate mortgage is at its lowest level since the week ending May 23, 2013, according to the latest survey from mortgage buyer Freddie Mac.

Last week at this time, the 30-year fixed-rate mortgage averaged 3.66%. A year ago, it was trending at 4.39%.

“I don’t think there will be much upward pressure on rates next week and doubt they will drop much lower than where they are at now,” said Polyana da Costa, senior mortgage reporter at Bankrate.com, which surveys experts in the mortgage industry to see if they believe mortgage rates will rise, fall, or remain relatively unchanged.

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The low rates have led to a surge in mortgage applications recently. Mortgage application volume jumped 14.2% over the last week, according to the Mortgage Bankers Association (MBA). Total volume is now 41% higher than it was one year ago, and it’s driven entirely by refinances, the MBA says.

Applications to refinance increased by 22% week-over-week––up 63% from a year ago.

The average rate on a 15-year fixed mortgage also registered a drop, to 2.93% from 2.98% last week. A year ago, it averaged 3.44%, according to Freddie Mac.

Averages for the two most popular hybrid adjustable-rate mortgages were mixed. The five-year ARM dropped from 2.90% to 2.83% week-over-week. The one-year ARM held steady at 2.37%.

In the latest Mortgage Rate Trend Index, 59% of the panelists polled think rates will remain relatively unchanged, while 33% predict rates will decrease.

“Due to the lack of big economic news this week and the fact that last Friday (Jan. 16) saw a jump in mortgage rates, I expect the market to correct itself,” said Shashank Shekhar, CEO of Arcus Lending in San Jose, CA. “The rates will mostly remain flat but should go down by a small margin.”

Falling Mortgage Rates Fuel Buying Activity

Mortgage interest rates rolled back to 2013 levels this week on disappointing housing and economic activity.

The 30-year fixed-rate mortgage averaged 3.59% this week, down from 3.66% last week. A year ago this time, it was as high as 4.32%, according to the Freddie Mac Primary Mortgage Market Survey.

“Mortgage rates fell this week following the release of weaker-than-expected pending home sales,” said Len Kiefer, deputy chief economist at Freddie Mac.

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Pending home sales fell 3.7% in December, according to the National Association of Realtors®. The Pending Homes Sales Index tallies contract signings. It’s a strong indicator of where the market is headed, since a home is listed as pending only after all contingencies have been met and the deal is simply waiting to close.

“Fewer homes available for sale and a slight acceleration in prices likely led to December’s decline,” said Lawrence Yun, chief economist at NAR. “With interest rates at lows not seen since early 2013, the strength in existing sales in upcoming months will largely depend on the willingness of current homeowners to realize their equity gains from the past couple of years and trade up.”

Demand is improving

Mortgage applications for Federal Housing Administration loans spiked last week in the midst of lower FHA mortgage insurance premiums, according to the Mortgage Bankers Association. Both purchase and refinance activity are up, signaling higher demand for housing.

“More jobs, increasing consumer confidence, less expensive mortgage insurance, and new low-down-payment programs coming into the marketplace will likely lead to more demand from first-time buyers,” said Yun.

Buyers are refinancing, and they’re choosing FHA loans to do so. Refinance applications using FHA loans increased 76.5% after the drop in mortgage insurance premiums. FHA purchase applications increased 12.4%, according to the MBA.

Rates are responding

The 15-year fixed-rate mortgage fell to 2.92% this week from 2.98% last week, according to Freddie Mac. It was 3.4% a year ago.

The 5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 2.82% this week, down slightly from 2.86% last week. A year ago this time, it was 3.12%.

The 1-year Treasury-indexed ARM averaged 2.39% this week, up from 2.38% last week. It is still lower than last year at this time, when it averaged 2.55%.

More Jobs Is Good, Right? Well, More Jobs Also Means Higher Mortgage Rates

The good news: In the past four months, the U.S. economy gained 1.125 million jobs. The slightly more frustrating news: In that time, 30-year fixed mortgage rates dropped from an average of nearly 4% to 3.67% in January. They are now slowly ticking back up, hitting 3.86% this week.

This is how it goes. As more people get jobs, they have more money to spend. Because they have more money to spend, banks increase the interest rates they apply to mortgages. Such was the case this week, as rates rose due to last Friday’s better-than-expected jobs report:

30-year fixed-rate mortgages averaged 3.86%, up from 3.75% last week and down from 4.37% a year ago.
15-year FRM averaged 3.10%, up from 3.03% last week and down from 3.38% a year ago.
5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.01%, up from 2.96% last week and down from 3.09% a year ago.
1-year Treasury-indexed ARM averaged 2.46%, up slightly from 2.44% last week and down slightly from 2.48% last year.
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While the rising rates might make you anxious, please keep calm—they’re still really low.

“Since last March, rates have fallen 0.7%, a 9% stimulus to home prices. For all but the most affluent home buyers, payment trumps price, and sellers now have the ability to raise prices again,” according to John Burns Real Estate Consulting.

And so home prices are rising, and every uptick in interest rates makes housing affordability an issue. The more interest you pay, the less home you can qualify to purchase.

A family with a $60,000 annual income, and no debt, could qualify for a $245,000 house with a $1,800-a-month mortgage payment at a whopping 8% interest rate, according to Burns Consulting. But with rates hovering around 4%, that same family would qualify for $377,000. Lower rates mean higher purchasing power.

And because more Americans are employed—the national unemployment rate is 5.5%—an improving economy means more people can actually buy houses (at least we hope).

Your Local Mortgage Broker In The Cleveland & Redlands Area

Redlands Mortgages Pty Ltd are a local family run business that encourages and prides itself on the personal touch when it comes to our clients. As your local Cleveland & Redland Bay mortgage broker we will work with you to make the experience of approving your mortgage as streamlined as possible. As a family business we understand how important time is to manage for a lot of hard working people and take the extra effort to work with you and are happy to visit you at your house in the evenings and weekends to save you time.
So if you are looking for a Mortgage Broker in Brisbane servicing Cleveland, Capalaba, Redland Bay, Mount Cotton, Capalaba, Victoria Point, right through to Wynnum / Manly look no further and call us today on 1800 REDLOANS

As a member of the First Choice Finance Group we have the backing and support of a wealth of knowledge. First Choice Finance Group was established in 2004 as an alternate home loan service provider from the traditional banks. Our support network is provided by highly experienced finance professionals, who visit clients at home or work 7 days or nights per week. Our Finance Consultants all hold recognised Industry qualifications.    
Redlands Mortgages Pty Ltd is a full members of the – FBAA (Finance Brokers Association of Australia) – PLAN Australia (Professional Lenders Association Network of Australia) and – CIO (Credit Investment Ombudsman)
So if your looking for finance options in Redland Bay, Cleveland, Capalaba or surrounding suburbs, we have the solution for you from your very first home loan to an investment property, self managed super funds and commercial business loans. Simply fill out our easy online forms or call us today on 1800 REDLOANS

Mortgage Rates Drop Slightly as Home Sales Heat Up

All of the housing news this week has been good—home sales are up for both resales and new construction—and now interest rates have moved lower.

As the spring housing market gets started, home buyers are taking advantage of what industry insiders believe to be the last days of low mortgage rates.

The 30-year fixed-rate mortgage averaged 3.69% this week, down from 3.78% last week. It was 4.4% a year ago this time, according to the Primary Mortgage Market Survey.

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“Low mortgage rates are a welcome sign for those in the market to buy a home this spring season and will help to support home buyer affordability,” said Len Kiefer, deputy chief economist at Freddie Mac.

Rates first moved below the 4% mark the week of Nov. 10, 2011, according to Freddie Mac, thanks to intervention by the Federal Reserve. Since then, rates have fluttered up and down marginally, but home buyers have grown accustomed to these artificially low rates. However, the Fed has indicated it will not long continue to hold down interest rates. Indeed, experts are expecting a rate increase this summer.

Home buyers pushed existing-home sales slightly higher in February to a seasonally adjusted annual rate of 4.88 million units, slightly below economist expectations but still higher than last year. Meanwhile, new construction has finally entered the equation, outperforming industry expectations with a 7.8% increase in February new-home sales.

The 15-year FRM also trended down to 2.97% this week, on average, vs. 3.06% last week. It was 3.42% last year this time. Likewise, the 5-year Treasury-indexed hybrid adjustable-rate mortgage dipped to 2.92% this week from 2.97% last week. It averaged 3.1% a year ago this time.

Only the 1-year Treasury-indexed ARM was unchanged at 2.46%. However, it is higher than where it stood last year this time when it averaged 2.44%.

Mortgage Applications in U.S. Dip in Mid-February

According to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending February 15, 2013, mortgage applications decreased 1.7 percent from one week earlier.

The Market Composite Index, a measure of mortgage loan application volume, decreased 1.7 percent on a seasonally adjusted basis from one week earlier.  On an unadjusted basis, the Index decreased 1 percent compared with the previous week.

The Refinance Index decreased 2 percent from the previous week.  The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index increased 3 percent compared with the previous week and was 17 percent higher than the same week one year ago.

The refinance share of mortgage activity decreased to 77 percent of total applications, the lowest level since May 2012, from 78 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 4percent of total applications.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,500 or less) increased to 3.78 percent, the highest rate since August 2012, from 3.75 percent, with points decreasing to 0.40 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The contract interest rate for 30-year fixed mortgages has increased for nine of the last ten weeks.  The effective rate increased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $417,500) decreased to 3.94 percent from 3.98 percent, with points increasing to 0.40 from 0.36 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 3.54 percent, the highest rate since August 2012, from 3.53 percent, with points increasing to 0.40 from 0.39 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 3.03 percent, the highest rate since September 2012, from 3.01 percent, with points increasing to 0.38 from 0.28 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs remained unchanged at 2.66 percent, with points increasing to 0.32 from 0.31 (including the origination fee) for 80 percent LTV loans.  The effective rate increased from last week. - See more at: http://www.worldpropertyjournal.com/north-america-residential-news/mortgage-applications-refi-mortgages-mortgage-bankers-association-weekly-mortgage-applications-6540.php#sthash.jLcqabDY.dpuf

How To Get A Mortgage After Bankruptcy

Bankruptcy can be described as a legal status of a person that cannot make repayments of debts owed to creditors. Going into or filing for bankruptcy closes up opportunities or shuts down your ability to borrow money or use a credit card. Also, bankruptcy reduces your credit ratings.

Long before now, a bankruptcy carried a huge negative stigma that attached to your credit history in a period of seven to ten years but in recent times, that stigma has lessened and bankruptcy have become a regrettable way to gain a financial fresh start. So therefore, a home buyer who has filed for bankruptcy can qualify for a mortgage in a s little as two years after the bankruptcy of the home buyer have been discharged.

However, with proper preparation and financial planning, it is easy to say that obtaining a mortgage after bankruptcy is totally possible.

IMPORTANT THINGS TO KNOW BEFORE CONSIDERING APPLYING FOR A HOME LOAN OR CARRYOUT MORTGAGE APPLICATION AFTER BANKRUPTCY:
The important things to know include:

1. Wait period: there is a specific time frame or waiting periods for getting a mortgage after bankruptcy. Majorly, the standard time it takes for you to apply for a mortgage after bankruptcy is two years and is advisable to use the waiting periods to improve your credit ratings so that the lender will not disqualify you after a bankruptcy discharge.

2. Detail mortgage application: the only way to guarantee your ability and willingness to repay the mortgage is to completely analyses your financial situation. So it is important to provide the mortgage company with any financial information requested of you. Note that the lender, will not approve a loan request if they feel that the borrower is likely to repeat past mistakes that made the borrower file for bankruptcy.

3. Apply for an FHA mortgage: FHA mortgage is a mortgage insured by the a Federal Housing Administration. After waiting for two years or more after your bankruptcy have been discharged, it is advisable to apply for FHA mortgage loan especially after receiving discharge from a chapter 7 bankruptcy. And be prepared to explain why you had difficulties financially and also what plan you have to make sure it doesn’t happen again.

STEPS TAKEN TO APPLY FOR A MORTGAGE AFTER BANKRUPTCY:
there are steps taken to ensure and be able to carry out mortgage application after bankruptcy. They are:

1. Discharge all available debts: the first thing to do is to make sure that the bankruptcy is discharged. If this is not done, no lender will speak you. And after this is done, you organize and scrutinize your report, this is necessary to counter errors that may appear on your credit report. For example, if there are debts that have been paid but still appear as unpaid on your credit report, when you org anise or scrutinize your report thoroughly, such errors won’t occur.

2. Pay bills on time: one major factor that improves your credit ratings and gives a higher chance of being able to get a mortgage after bankruptcy is your quick and early payments of all bills that have to be paid.

3. Apply for credit cards: another fast way of rebuilding your credit score is to apply for a secured credit card as soon as possible. These cards require that you hold on an amount in an account and lend you up to a matching amount as a credit limit.#

4. Wait for at least two years: this is important because the interest rates will be more favorable when you wait for two years after your bankruptcy is discharged than when you immediately apply for a mortgage after discharging your bankruptcy. Also, the waiting period gives you the chance to build up your credit well and save up money so that you can make good down payments remembering that the higher your down payment, the lower your interest made.

Knowing very well that it is hard but not impossible to apply for a mortgage after bankruptcy with a good mortgage information, it is also very essential to understand that all the rules and steps to ensure the application is successful solely depends on you not making the same mistakes that made you go bankrupt before.