Bankrate.com Mortgage Trend Index (August 30, 2007)

I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey is now available. I am a little frightened that every person surveyed predicts at least a decrease. We can't all be right. Can we? 0% of participants predict rates will increase 77% of participants predict rates will decrease 23% of participants predict rates will remain unchanged I am predicting that rates will decrease over the next 30 days, but that doesn't mean you should...

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[Source: The Mortgage Reports Blog]

Foreign Nationals: Today's Sign That Liquidity May Be Returning To The Market

I am working with a Dublin-based real estate developer, providing Irish real estate investors with mortgages for United States-based properties. A project on which we are currently working has been interesting in context of how the mortgage market is changing. When we started work on this Chicago-based condo building, the lending landscape was very different than it is today. Our initial lender evaluation for the buyers/investors included eight separate banks and a multitude of mortgage products. As of today, we...

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[Source: The Mortgage Reports Blog]

Is It Time For National Real Estate News To Go Away?

To borrow (and twist) a phrase from famed politician Tip O'Neill: "All real estate is local."So, here we are, another month passes and another series of national home sales reports leaves us wondering about the state of housing in America. But does the data really tell us anything? Point #1: New Home Sales only measures the number of new contracts written on homes that are newly-built. The report doesn't do follow-up to see if the homes actually closed, though. With...

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[Source: The Mortgage Reports Blog]

Bankrate.com Mortgage Trend Index (August 23, 2007)

I am a regular participant in the Bankrate.com Mortgage Rate Trend survey and this week's survey is now available. 0% of participants predict rates will increase 69% of participants predict rates will decrease 31% of participants predict rates will remain unchanged I am predicting that rates will decrease over the next 30 days, but that doesn't mean you should necessarily follow my advice when choosing whether to lock a rate, or float it. My advice may not be appropriate for...

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[Source: The Mortgage Reports Blog]

How Sub-Prime and Alt-A Mortgage Markets Are Behaving Like NFL Draft Picks

Did you see the BNP Paribas press release last week that said it's halting withdrawals from some of its funds? My favorite part is how blunt the first sentence is below (bold added for emphasis):"The complete evaporation of liquidity in certain market segments of the US securitisation market has made it impossible to value certain assets fairly regardless of their quality or credit rating."In other words, BNP stopped allowing withdrawals because it has aucune ide just what it's holdings are...

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[Source: The Mortgage Reports Blog]

Interview with First Business: Will the Fed Cut Rates?

I interviewed with First Business anchor Anchor Beejal Patel this week. First Business produces news "shorts" that are syndicated nationwide. The story: "How would a Fed rate cut impact mortgage rates?" You all know my answer -- it's well-documented around these parts. I am a little embarrassed about having to use somebody else's office for the spot, though; you'll notice the photo of his three kids and one of their rainbow drawings over my left shoulder. The rainbow does complement...

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[Source: The Mortgage Reports Blog]

Second Mortgage Disadvantages

Think twice before taking a second mortgage! It does have some advantages, but there are disadvantages too. That is why you have to put on a balance all the pluses and minuses before going forward with it. Make sure it is what you need.

The bigger disadvantage of the second mortgage is the fact that you are putting your home as the security for its repayment, cause the mortgage is based on your home's equity, isn't it? Be 100 percent positive that you have the possibility to pay in the established time, or you can be obliged to give your home to the lender.

One of the important disadvantages of the second mortgage is the interest rate. Usually it is much higher if compared to the first loan rate, which results for you in paying more during the term of the loan. If you are ready to pay more, try to study other options for loans - they could match your needs, or at least you won't pay more money as in the second mortgage case.

However, the decision is yours, all the loans have their benefits and disadvantages, they don't have to stop you, just be aware of them.

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[Source: Loan Mortgages]

When Foreclosure Rates Drop, You'll See: Free Markets Can Outperform Government Legislation

Did you notice: In what took many state governments over 18 months (and counting) to "fix", "free markets" eliminated in three days.Regardless, a few years from now, state legislators in Illinois, Minnesota and elsewhere will take credit for the reduced number of foreclosures in their home states, without even nodding to the real reason. They will say: "We stopped predatory lending with our new laws!". Guys like me will say: "No, Wall Street just stopped providing money to homeowners most...

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[Source: The Mortgage Reports Blog]

Was a 20% Downpayment Not Enough For The Banks?

I have theorized about the 20% Downpayment Myth on the blog and in trade rags such as Chicago Real Estate Executive. Why do banks like to see a home buyer make a downpayment of at least 20%? Because that's the typical "discount" offered on homes against which the mortgage has defaulted. If a homeowner has a 20% stake, the bank has nothing to lose. Literally. Except now there's this anecdote coming from San Diego via The Wall Street Journal Online....

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[Source: The Mortgage Reports Blog]

FOMC Press Release: Translation Provided (August 2007)

The Fed left the Fed Funds Rate unchanged again today for the ninth time in a row after 17 consecutive hikes. The Fed once again highlighted inflation containment as its chief concern while noting that pressures on the economy appear to be moderating. Mortgage rates were flat after the Fed's fairly neutral remarks. As always, the legendary Holden Lewis of Bankrate.com summarizes the Winners and Losers of yesterday's events. SourceParsing the Fed StatementThe Wall Street Journal OnlineAugust 7, 2007http://online.wsj.com/mdc/public/page/2_3024-info_fedparse_shell.html

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[Source: The Mortgage Reports Blog]

What Trader Joe's And Yogurt Taught Me About Home Loan Scarcity

A favorite question from my clients is "Should I lock my mortgage rate, or should I float my mortgage rate?" I am firmly in the "Lock Now" camp and have written about this more than a few times. My standard answer to the questions has lately taken a different spin, though. I still recommend locking a mortgage rate as early as makes sense, but I am now making the recommendation for a different reason. In short, lock your rate today...

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[Source: The Mortgage Reports Blog]

Simpsonize Me : My Would-Be Life As A Simpsons Character

If I was a Simpsons character, this is what I would look like. Four fingers and all. Thank you, Simpsonize Me.

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[Source: The Mortgage Reports Blog]

What To Do If Your Home Is Losing Value And You Aren't Planning To Sell

A few clients called me this week to share concerns about a declining housing market and how it would impact their long-term financial planning. "I need my home equity for retirement", one said. "What if foreclosures on my neighbors ruin my nest egg." Our ensuing conversation covers some basic facts about home equity: Home equity is an asset -- just like stocks, bonds, or a stamp collection Home equity grows or shrinks as a home's value grows or shrinks Home...

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[Source: The Mortgage Reports Blog]

Will You Be Stranded At The Closing Table With No Mortgage Money?

This week, several high-profile companies stopped funding mortgage loans including ABC, American Home Mortgage, mTeam Financial, and HLB. What to do if you are a home buyer: Call your loan officer Confirm that your mortgage approval is not impacted What to do if you are a home seller under contract: Call your real estate agent, attorney, or whomever Find out if your buyer's mortgage approval is impacted What to do if you get "bad news" that your loan won't fund:...

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[Source: The Mortgage Reports Blog]