Category: Loan Officer Compensation

INTEREST RATES DROP TO 1 MONTH LOWS

INTEREST RATES DROP TO 1 MONTH LOWS

January 13th, 2014

Interest rates finally gained some momentum after weeks of movement higher.

On Friday, the December employment report was released. Analysts predicted Non Farm Payroll Jobs to increase by 196,000 and the unemployment percentage to remain at 7%. The analysts vastly overestimated the increase, causing a huge movement in the bond markets and pushing rates lower by approximately .125%.

Non Farm Payroll jobs only increased by 74,000. Although the unemployment percentage dropped to 6.7%, much of that was due to people leaving the work force. Only 62.8% of the population is employed, which is the lowest level since 1976.

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This is welcome news for rate watchers after interest rates have steadily climbed for weeks straight. With the FED tapering, the long term outlook is still for interest rates to climb higher. Now is a good time to consider locking in while price is improved.

Have a great week!!

BEST VALUE OF THE WEEK:

30 Year Fixed at 4.5% with 0 points

15 Year Fixed at 3.625% with 0 points

TODAY’S RATES:

30 year fixed:     4.375% – .97 points,      4.5% – 0 points,      4.625% – $0 costs

20 year fixed:      4.125% – .39 points,      4.25% – 0 points,      4.375% – $0 costs

15 year fixed:     3.375% – .99 points,      3.625% – 0 points,      3.75% – $0 costs

10 year fixed:      3.125% – .58 point,      3.375% – 0 points,      3.5% – $0 costs

5/1 ARM:      2.875% – .94 points,      3.125% – 0 points,      3.5% – $0 costs

7/1 ARM:     3.25% – .99 points,      3.625% – 0 points,      3.875% – $0 costs

30 year fixed FHA:      3.75% – 1 point,      4% – 0 points,      4.25% – $0 costs

15 year fixed FHA:      3.25% – .49 points,      3.5% – 0 points       3.625% – $0 costs

30 year fixed VA:      3.75% – .84 points,      4% – 0 points,      4.25% – $0 costs

Today's Interest Rates - January 13th, 2014

Today’s Mortgage Interest Rates. Current Mortgage Interest Rates and APRs for refinancing and purchasing in Arizona, California, and Colorado. Arizona Home Loans, California Home Loans, Colorado Home Loans. Arizona refinance, California refinance, Colorado refinance. Scottsdale, Arizona Mortgage Banker in McCormick Ranch. McCormick Ranch Loan Officer. Scottsdale Loan Officer. Scottsdale mortgage, McCormick Ranch mortgage, 30 Year Fixed Mortgage rates, 20 year fixed Mortgage rates, 15 year fixed mortgage rates, 10 year fixed mortgage rates, 5/1 ARM mortgage rates, 7/1 ARM mortgage rates, 10/1 ARM mortgage rates, ARM mortgage rates, Variable Mortgage rates, Interest Only Mortgage rates, HARP mortgage rates, HARP 2.0 mortgage rates, HARP 3.0 mortgage rates, DU Refi Plus Mortgage rates, Freddie Mac Open Access Mortgage rates, Fannie Mae Home Path Mortgage rates, Freddie Mac Foreclosure Relief Mortgage rates, 30 Year Fixed VA rates, 15 year fixed VA rates,VA mortgages rates, VA Interest Rate Reduction Loan rates, VA IRRL rates, FHA mortgage rates, 30 Year Fixed FHA rates, 15 year fixed FHA rates, FHA streamline refinance mortgage rates, Conforming mortgage rates, Conventional Mortgage rates, 100% Financing Mortgage, High Balance Mortgage rates, Fannie Mae mortgage rates, Freddie Mac Mortgage rates, No appraisal refinance, 0 point mortgages, 0 closing cost mortgages, paying a point mortgages, $0 closing costs home loan, Refinance mortgages, purchase mortgages, and Jumbo Mortgages.  January 13th 30 year fixed rates, January 14th 30 year fixed rates, January 15th 30 year fixed rates, January 16th 30 year fixed rates, January 17th 30 year fixed rates, January 18th 30 year fixed rates, January 19th 30 year fixed rates, January 20th 30 year fixed rates

INTEREST RATES DROP TO 1 MONTH LOWS

TODAY’S INTEREST RATES / NEW .5% DOWN PAYMENT PROGRAM

TODAY’S INTEREST RATES / NEW .5% DOWN PAYMENT PROGRAM

January 6th, 2014

New Year

I hope everyone had a happy and safe New Years!!

Interest rates didn’t move much last week with the majority of traders on vacation. The MBS market closed + 18 bps, so mortgage pricing improved slightly.

On Friday, the December employment report will be released. More positive gains in employment will result in rates continuing their march higher.

My recommendation is still to lock as rates will likely continue to rise.

Have a great week!!

.5% DOWN PAYMENT PROGRAM – AVAILABLE NOW!!

This new program helps potential borrowers qualify for a new purchase home loan with as little as a .5% down payment.

The program works as follows:

96.5% LTV 1st FHA Mortgage
3% LTV 15 Year Fixed 2nd Mortgage

This is a great product for those borrowers that have decent credit and income, but don’t have the funds or gifts available for a 3.5% or 5% down payment.

Please call me for details or if I can help any of your clients with this new product.

no-money-down-mortgage-first-time-home-buyers1

BEST VALUE OF THE WEEK:

5/1 ARM at 3.25% with 0 points
10 Year Fixed at 3.5% with 0 points

TODAY’S RATES:

30 year fixed:      4.5% – 1 point,      4.625% – 0 points,      4.75% – $0 costs

20 year fixed:      4.25% – .6 points,      4.375% – 0 points,       4.625% – $0 costs

15 year fixed:      3.5% – .99 points,      3.75% – 0 points,      3.875% – $0 costs

10 year fixed:      3.25% – .83 point,      3.5% – 0 points,      3.625% – $0 costs

5/1 ARM:     3% – .7 points,      3.25% – 0 points,      3.625% – $0 costs

7/1 ARM:      3.375% – .96 points,      3.625% – 0 points,      3.75% – $0 costs

30 year fixed FHA:      4% – .92 points,      4.25% – $0 costs

15 year fixed FHA:      3.375% – .84 points,      3.625% – 0 points     3.75% – $0 costs

30 year fixed VA:      4.125% – .87s point,       4.25% – $0 costs

Today's Interest Rates - January 6th, 2014

Today’s Mortgage Interest Rates. Current Mortgage Interest Rates and APRs for refinancing and purchasing in Arizona, California, and Colorado. Arizona Home Loans, California Home Loans, Colorado Home Loans. Arizona refinance, California refinance, Colorado refinance. Scottsdale, Arizona Mortgage Banker in McCormick Ranch. McCormick Ranch Loan Officer. Mortgage Rate Sheets for fixed mortgages, ARM mortgages, Variable Mortgages, Interest Only Mortgages, HARP mortgages, HARP 2.0 mortgages, DU Refi Plus Mortgages, Freddie Mac Open Access Mortgages, Fannie Mae Home Path Mortgage, Freddie Mac Foreclosure Relief Mortgage, VA mortgages, VA Interest Rate Reduction Loans, FHA mortgages, FHA streamline refinance mortgages, Conforming mortgages, Conventional Mortgages, 100% Financing Mortgage, High Balance Mortgages, Fannie Mae mortgages, Freddie Mac Mortgages, No appraisal refinance, 0 point mortgages, 0 closing cost mortgages, paying a point mortgages, Refinance mortgages, purchase mortgages, and Jumbo Mortgages.  January 6th 2014 interest rates, January 7th 2014 interest rates, January 8th 2014 interest rates, January 9th 2014 interest rates, January 10th 2014 interest rates, January 11th 2014 interest rates, January 12th 2014 interest rates, January 13th interest rates.

TODAY’S INTEREST RATES      /       NEW .5% DOWN PAYMENT PROGRAM

FED TAPERS – RATES WILL GO UP IN 2014 WITH GSE FEE INCREASE

FED TAPERS – RATES WILL GO UP IN 2014 WITH GSE FEE INCREASE

December 26th, 2013

I hope everyone had a Happy and Safe Holiday!!

As many have heard by now – The FEDERAL RESERVE BOARD finally decided to taper their bond purchasing program – capping months of speculation on when the move would take place.   The FED will reduce it’s bond purchasing by 10 million per month. This relatively small taper as well as the market already taking into account that a taper would happen helped rates not go through the roof. Still mortgage interest rates are much higher than most have become accustomed to and will head higher in 2014.

GSE FEE INCREASE IN 2014:

Along with more tapering likely coming from the FEDERAL RESERVE BOARD in 2014, the GSEs FANNIE MAE and FREDDIE MAC announced fee changes to lenders last week.

These fee changes will raise the rate for most borrowers .125% – .375% once they hit lender rate sheets. After announcing the Fee change, FHFA director Mel Watt pulled back the implementation, announcing a delay in the fee change until he is able to further determine if this plan of action is the best way to move forward.

So at this point, the fee changes which raises the fees FANNIE MAE and FREDDIE MAC charge lenders to buy their loans is delayed after most expected these changes to hit lender rate sheets in January 2014.

If/when these changes going into effect – they will dramatically raise rate/borrower costs for most borrowers. Loan level pricing adjustments are certain characteristics of a customer’s loan that cause the loan to be more expensive. Some of the changes announced:

– Highest qualifying credit score will now be 800, currently any borrower with a 740+ credit score will get best mortgage pricing
– Cash out loans will increase in rate/costs
– Lower credit score borrowers will increase in rate/costs
– Investment property loans will increase in rate/costs

Below is a chart of the proposed loan level pricing adjustment for Fannie Mae and Freddie Mac in 2014.  Below is also a great article explaining the Fee changes:

http://www.mortgagenewsdaily.com/12172013_mortgage_rates_to_take_big_hit_from_fee_hikes.asp 

Fannie_Mae_LLPA

So at this point these changes are delayed, but I guarantee fee increases are coming – but maybe not as drastic as the ones announced.

All signs point to higher rates in 2014.

It has been a great few years with record low mortgage interest rates. If you haven’t taken advantage, I would recommend locking in before rates continue to move higher.

Have a great week!!

BEST VALUE OF THE WEEK:

10 Year Fixed at 3.5% with 0 points

5/1 ARM at 3.25% with 0 points

TODAY’S RATES:

30 year fixed:     4.625% – .30 points,      4.75% – 0 points,      4.875% – $0 costs

20 year fixed:      4.25% – 1 point,       4.5% – 0 points,       4.625% – $0 costs

15 year fixed:      3.625% – .49 points,      3.75% – 0 points,       4% – $0 costs

10 year fixed:      3.25% – .99 point,      3.5% – 0 points,       3.75% – $0 costs

5/1 ARM:       3% – .81 points,       3.25% – 0 points,        3.625% – $0 costs

7/1 ARM:       3.375% – 1 point,        3.75% – 0 points,        4% – $0 costs

30 year fixed FHA:      4.125% – .37 points,       4.25% – $0 costs

15 year fixed FHA:      3.375% – .95 points,      3.625% – 0 points,       3.75% – $0 costs

30 year fixed VA:       4.125% – .83 points,       4.25% – 0 points,       4.375% – $0 costs

Today's Interest Rates - December 26th, 2013

Today’s Mortgage Interest Rates. Current Mortgage Interest Rates and APRs for refinancing and purchasing in Arizona, California, and Colorado. Arizona Home Loans, California Home Loans, Colorado Home Loans. Arizona refinance, California refinance, Colorado refinance. Scottsdale, Arizona Mortgage Banker in McCormick Ranch. McCormick Ranch Loan Officer. Mortgage Rate Sheets for fixed mortgages, ARM mortgages, Variable Mortgages, Interest Only Mortgages, HARP mortgages, HARP 2.0 mortgages, DU Refi Plus Mortgages, Freddie Mac Open Access Mortgages, Fannie Mae Home Path Mortgage, Freddie Mac Foreclosure Relief Mortgage, VA mortgages, VA Interest Rate Reduction Loans, FHA mortgages, FHA streamline refinance mortgages, Conforming mortgages, Conventional Mortgages, 100% Financing Mortgage, High Balance Mortgages, Fannie Mae mortgages, Freddie Mac Mortgages, No appraisal refinance, 0 point mortgages, 0 closing cost mortgages, paying a point mortgages, Refinance mortgages, purchase mortgages, and Jumbo Mortgages.  December 26th mortgage interest rates, December 27th mortgage interest rates, December 28th mortgage interest rates, December 29th mortgage interest rates, December 30th mortgage interest rates.

FED TAPERS    –     RATES WILL GO UP IN 2014 WITH GSE FEE INCREASE

MORTGAGE RATES SLOWLY RISING FROM RECORD LOWS / COULD PUSH LOWER THIS WEEK.

MORTGAGE RATES SLOWLY RISING FROM RECORD LOWS  /  COULD PUSH LOWER THIS WEEK.

February 20th, 2012

The MBS Market closed last week trading down (- 13 bps).   Rates continue to slowly inch higher with increased optimism towards the economy and the recent rally in the stock markets.

The stock market is at a 9 month high but concerns still remain that the market is higher than it should be.  Over 85% of stocks in the New York Stock Exchange are trading above their 50 day moving averages, even though profit reports have been less than stellar.  In Europe news, a meeting on Monday to try and finally resolve the Greek debt issue was not successful.  (2/21/12 UPDATE – they have now negotiated a deal)

I’m thinking we may see the stock market push down this week, which could push mortgage rates lower from their recent move up.  

I recommend customers serious about getting a mortgage being ready to lock on short notice this week.   

Below are rates available today paying a point or less:

30 year fixed: 3.875% paying .99 points, 4.125% paying 0 points

20 year fixed: 3.625% paying .95 points, 4% paying 0 points

15 year fixed: 3.125% paying .94 points, 3.375% paying 0 points

5/1 ARM: 2.75% paying .85 points, 3.125% paying 0 points

7/1 ARM: 3% paying .71 points, 3.25% paying 0 points

30 year fixed High Balance Loan: 4% paying 1 point, 4.375% paying 0 points

30 year fixed FHA: 3.75% paying 0 points

15 year fixed FHA: 3% paying .82 points, 3.25% paying 0 points

30 year fixed VA: 3.75% paying 0 points

 

Today’s Mortgage Interest Rates.  Current Mortgage Interest Rates and APRs for refinancing and purchasing in Arizona, California, and Colorado.  Mortgage Rate Sheets for fixed mortgages, ARM mortgages, Variable Mortgages, Interest Only Mortgages, HARP mortgages, HARP 2.0 mortgages, DU Refi Plus Mortgages, Freddie Mac Open Access Mortgages, Freddie Mac Foreclosure Relief Mortgage, VA mortgages, VA Interest Rate Reduction Loans, FHA mortgages, FHA streamline mortgages, Conforming mortgages, Conventional Mortgages, High Balance Mortgages, Fannie Mae mortgages, Freddie Mac Mortgages,  No appraisal refinances, and Jumbo Mortgages.

MORTGAGE RATES SLOWLY RISING FROM RECORD LOWS  /  COULD PUSH LOWER THIS WEEK.

HOW MORTGAGE PRICING WORKS : WHY ARE YOU GETTING THE RATE AND COSTS THAT YOU ARE?

HOW MORTGAGE PRICING WORKS:

There is so much information out there regarding mortgage rates, costs, etc., it is very easy to see why some consumers get confused about mortgage pricing.  This blog will attempt to explain to you mortgage pricing and how it applies to you and your clients.

WHAT IS THE FIRST QUESTION EVERY LOAN OFFICER GETS ASKED?

WHAT IS YOUR RATE?  is by far the most common thing a potential client says first.

Unfortunately, there is not a simple answer to this question.  As a mortgage loan officer, we can offer you a variety of different rates relative to the costs you want to pay.

The lower rates cost more and as we bring the rate higher, the closing costs go down.  For example, when putting together a quote for a customer, I do something like this:

30 YEAR FIXED AT 4.375% – costs $4,400

30 YEAR FIXED AT 4.5% – costs $2,300

30 YEAR FIXED AT 4.625% – costs $0

When deciding what rate works best for you, you are going to want to consider how long you will be in the loan.  If you plan on selling the home in 6 months, you want to keep your costs low because you don’t have the time to recoup the costs.  If you plan on staying in the loan for 30 years, typically it makes more sense to pay a bit more in costs at the beginning of the loan.

WHY DO LOWER RATES COSTS MORE?

Whether you realize it or not, your loan is almost always sold immediately after the loan is completed.

The reason higher rates cost less is because a lender is making a higher premium when selling your loan on the secondary market.  Thus they can charge you less and still be profitable.  A lender can also do a 0 cost loan.  They can do this by making enough on the sale to cover all third party charges like title, escrow, and appraisal and still be profitable.

WHY DO MORTGAGE COMPANIES DIFFER IN PRICING:

For the most part, mortgage rates and pricing should be similar if you are rate shopping.  If you are rate shopping and one company is vastly superior over the others, it may be to good to be true.

Even though rates / pricing are similar between companies, they will not be the same for a variety of different reasons.

1# – Each company has a different level of profit they are making on each loan.  Some companies make less on each loan, but strive to do a lot of volume.

Some companies try to make more on the loans they do fund, even though they may lose some business with rate shoppers.

A lot of times the profitability of each loan has to do with the lender’s overhead.  If you have a large company that does a lot of advertising, has health insurance for all of their employees, etc, your loan is typically going to be more expensive because you have to pay for these things somewhere.

2# – Loan officers have different pre-negotiated levels of compensation.  With the new lending laws that went into place in April 2011, each loan officer must have the same level of pricing on all loans.  This can only change when charging upfront fees.

For example, I make 1% on every loan I do.  Regardless of anything about the loan, if I fund the loan, I make 1%.  Some loan officers may have a negotiated price of 1.5%.  Some maybe 2%.

If a loan officer’s company prices similarly but I have a lower pre-negotiated rate of commission, I will be able to offer the better deal.

I hope this clears some of the confusion regarding mortgage pricing and makes you a more knowledgable consumer when shopping for a loan.

 

MORTGAGE RATES BACK TO LOWEST LEVELS OF THE YEAR – 6/27/11

MORTGAGE RATES BACK TO LOWEST LEVELS OF THE YEAR:  The bond market closed the week 56 bps higher – pushing rates back to the lowest levels of the year.  This ended 2.5 weeks of the bond market going down, pressuring rates higher.

30 year fixed rates are now back to 4.375% with a portion of a point.  20 year fixed loans are back to 4.25%.  5/1 ARMS are down to 2.875%.

We are now in the last week of the FED purchasing mortgage backed securities program – QEII.  The market will now determine interest rates without the FED manipulating demand.

6/20/11 – Mortgage Rates Rise for 2nd straight week / The Foreclosure Statistics

MORTGAGE RATES RISE FOR 2nd STRAIGHT WEEK:  The Bond market finished slightly down on the week – ending 6 bps lower.  This pushed rates slightly higher on the week.  You can still get a 4.375% on a 30 year fixed rate, but it will cost over a point.  4.49% is the par rate paying less than one point.

Overall, there is some pressure on mortgage rates right now.  The Feds Quantitative Easing measures are about to end, which could push rates a bit higher.  Overall, I don’t see rates going much higher or much lower from where they are right now for the foreseeable future. 

 

THE FORECLOSURE NUMBERS:   According to the US Foreclosure Market Report, foreclosure activity has decreased for the 8th straight month.

There are 3 foreclosure activities they consider in their report.  Notice of Default is when the mortgage company notifies the customer that they are in violation of their contract and they plan on foreclosing unless payments are brought back up to speed.  This can be given out after 3 months of late payments.  Foreclosures scheduled is when a home is scheduled to be taken back by the bank.  REO is when the bank takes back the home and it becomes part of the banks inventory.

From April to May:

Notice of Default rates went down by 7%

Foreclosures Scheduled went up by 3%

REOs went down by 4% 

Although the foreclosure activity has decreased, the results can be misleading.  Many lenders are delaying foreclosure proceedings for various reasons associated with their own process and procedures as well as market considerations in the area where the homes are being foreclosed in.  If they keep pumping more REOs into the market when their current inventory is high, it will push down the values of their existing inventory.

Also, even though the inventory of homes in the foreclosure process has decreased steadily over the past 6 months, the inventory of REOs is increasing.  This is because the amount of REOs being added to the market is outpacing the amount of REOs sold.  This points to a still struggling housing market where the demand is not on par with the supply. 

The states with the highest foreclosure rates in order are Nevada, Arizona, California, Michigan and Georgia. 

6/13/2011 – MORTGAGE RATE RALLY STALLS / 22.7% OF AMERICAN HOMEOWNERS ARE UNDERWATER ON THEIR MORTGAGE

MORTGAGE RATE RALLY STALLS:  Mortgage rates rose slightly as the bond market closed lower for the 2nd time in 8 weeks.  The bond market finished down 34 bps on the week.

This affected interest rates by raising the cost to get each rate by about .25%.  Par rates have remained steady for a number of weeks – right now they are just a bit more expensive.  A 30 year fixed rate is still at 4.375%.  15 year fixed rate is at 3.75%.  5/1 ARM rate is at 2.875%.

Interest rates have seemed to hit their bottom.  Rates will be tested this week with a lot of economic reports and information due out.

THE HOUSING NUMBERS:  According to a new report from CORE LOGIC, 22.7% of all homeowners in the United States owe more on their mortgage than their home is worth.  That translates to 10.9 million homeowners.

Another 2.5 million homeowners are very close to being underwater – having less than 5% equity in their home. 

The state with the highest percentage is Nevada, with a staggering 63% of their homeowners being upside down.  Arizona follows closely behind with 50% of their homeowners being upside down. 

Remember that after 2012, you will be taxed on losses associated with a short sale or a foreclosure.  If you are going to do it, you might as well get started.

6/6/2011 – MORTGAGE PRICING CONTINUES TO DROP

MORTGAGE PRICING CONTINUES TO DROP:  Mortgage rates / pricing went down for the 6th time in 7 weeks.  The bond market closed 50 points up last week, lowering pricing on most loan options by approximately .4 pts in cost to get the loan.

Though pricing is down, most of the par rates are still the same, just a bit cheaper to get in closing costs. 

Be cautious in waiting too long right now.  The Fed is discontinuing their mortgage backed securities program this month.  By the FED not pumping money into keeping interest rates low, we could see a rise in rates at the end of June.  I would lock in pricing if you are satisfied with a rate.

5/31 – MORTGAGE RATES DROP TO 4.375% – DOUBLE DIP IN HOME VALUES

MORTGAGE RATES DROP, BUT BE CAUTIOUS:   For the 5th time in 6 weeks, mortgage rates and pricing have dropped.  The bond market ended the week 47 bps higher – pushing rates lower.  The 30 year fixed par rate has dropped to 4.375%.  5/1 ARMs have dropped to 2.875%!!

But beware, there are signs that rates could have trouble this week.  There is optimism that a deal working to help Greece with their debt issues will go through.  This could mean trouble with the bond market, pushing rates higher. 

THE DREADED DOUBLE DIP IN HOME VALUES:  According the March S & P / Case Shiller Home Price Index, much of the nation is in the midst of a double dip in home values.  After being down for a number of years, price levels rose recently driven by the Federal Tax credit for new home buyers. 

Since the tax credit ended, prices have steadily dropped in most areas.  Across the country, home values are down 4.2% over the 1st quarter of 2011, and 5.1% down since March of 2010.  The average price of a home is now down to 2009 levels and if adjusted for inflation, down to 1999 levels. 

I personally think this is a great market to buy a new home.  Prices are low, rates are great.  If you are looking to purchase a long term home, you can get on a 30 year fixed rate and ride out the fluctuations in the market.  Is this the best market to have owned a home for a number of years? – I don’t think it could be much worse.  Good news is many people can still refinance at up to 105% of what their home is worth and still get a great rate.