Ed's Blog

 

Comments by the Federal Reserve have helped nudge rates a bit lower this week, especially for loans of $417,000 and below.
 
Spurred on by comments that the Fed would continue to buy mortgage backed securities to keep interest rates low, bond traders drove rates down yesterday afternoon. We are now at levels that are as low as they've ever been in my 20+ years in the business. 30 year fixed rates are back under 5.0% again. With points, it's possible to get a rate in the mid fours!
 
The catch now is that applications are soaring and lender "turn times" (time to approve, close, and fund loans) are getting longer quickly. The Mortgage Bankers Association (MBA) reported that applications are up a whopping 30% on top of already high levels. To get the best rates available, you need to lock on a 15 to 30 day lock. That means having your application in (with an appraisal) and submitted to a lender for approval. And in the case of the shorter lock times, having your loan already approved, which can take up to 15 business days. In other words, it pays to plan ahead and get your application going!
 
For those of you who qualify, I'd hate to see you miss out on these low rates because you didn't have your application in and weren't ready  to take advantage of what will be looked back on as one of the great times to refinance.
 
Rates for higher loan amounts have dropped also. For those of you in the $417,001 to $625,500 range, we're right around 5.0% (and lower) with points. For those over $625,500 and up to $1,000,000, we're finally starting to see some movement in rates. Phew! About time!
 
By the way, for those of you in the $625,000 to $729,750 range, good news is coming soon. You will also be eligible for better rates as you'll likely fall into the rate range of the $417,001 to $625,500 due to changes coming from the recently enacted stimulus and housing packages.
 
One last comment. Some of you might want to consider taking cash out at these incredibly low rates. I know it's hard to imagine that you would ever want to invest in anything again (!), but many believe we'll look back on this as a great time to buy stocks and real estate at bargain prices. You don't have to spend the money right away. You can watch and observe and see when the markets have turned up enough to make you comfortable. Or you may just want extra cash on hand in case the worst happens and the economy really tanks and you lose your job.
 
As always, we'll make things as easy for you as possible.
 
Give me a call,or send an email and we'll run the numbers for you to see if you can qualify for a refinance and if it makes sense to do it.
 
And if you're looking to buy, we'll be glad to see what you can qualify for. Prices are at incredible levels in many markets, including many neighborhoods in San Francisco.
 
Look  forward to hearing from you and saving you some big bank!
Posted by Ed Craine on March 21st, 2009 2:19 PMPost a Comment (0)

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