🍏 Shawn Hillman is
☎️ On Call
🌵 this weekend for Team Green
Contact him all weekend with your lending questions and prequalification needs.
🍏 Shawn Hillman
🏡 Team Green with Fairway
⛳ We Do Mortgages. Better.
TODAY’S INTEREST RATES
After a steady few weeks, Interest Rates are moving higher at a rapid pace in 2022.
If you regularly follow our weekly updates, we’ve been preparing for this for some time.
See Mortgage Backed Security Market below.
The massive drops in red equate to a drop in Mortgage Backed Security prices which means higher interest rate pricing.
Rate pricing is on average .125% to .25% higher than last week.
At a .25% higher rate, this equates to a $15 higher payment per $100,000 in loan amount.
The FED released their minutes this week and there is a very good chance the first FED interest rate increase
will happen in March 2022. The US Jobs report for December will be released on Friday 1/7/21.
This report usually gives strong indicators on where mortgage interest rates will head for the next month.
Below is today’s rate sheet for well qualified borrowers.
🚨 HUGE RATE HIKES COMING ON 2ND HOMES AND HIGH BALANCE LOANS
FHFA released a bomb on Wednesday.
For loans sold to Fannie Mae and Freddie Mac after 4/1/2022, interest rate pricing will be dramatically higher for 2nd Homes/Vacation Homes And High Balance Loans.
The increase for 2nd / Vacation Homes is especially eye popping – around 1% higher on the rate for most loan to values.
A 2nd Home is a home used by the owner as a vacation home. Many clients also purchase these type of homes to use as an AIRBNB / VRBO also use personally for a certain amount of time each year.
What this means for consumers – if you were planning on buying that 2nd home in the woods or on the beach and using financing – try and get under contract asap.
Although the change takes place 4/1/2022 – most lenders will likely cut off current pricing at least 2 weeks in advance of that if not a month as it takes some time to sell the mortgage.
This means these loans will likely have to fund by 3/1/2022 or 3/15/2022 – not start.
With most close of escrows being 30-45 days , the time is ticking to get the best deal on these properties.
High Balance Loans are present in certain areas of the country that have higher median home prices. Fannie and Freddie put together a conventional loan amount for the whole country every year. This amount is $647,200 for 2022.
In areas where most homes are much higher than that, they offer High Balance Conforming Loans above $647,200.
The pricing hits for High Balance loans will result in a rate increase of approximately .375% to .5% for most customers.
Please call me if you have any questions.