September 9, 2011

Did you know that interest rates in Mexico are way into the double digits, like 30-40%, for homes and/or credit cards? So most people must pay cash, as borrowing is too punitive. Or that in many countries you can't even own your home- the government does. We take so many obvious liberties for granted. They are not freedoms for us anymore, they are expected. A way of life. This Sunday, September 11, let us remember and honor not only those that perished, but honor the living every day. The men and women who put themselves in harm’s way so that we may enjoy even the smallest freedoms.

I was quite impressed when I read the NAR magazine last month that Realtors have collectively donated 22 million dollars to relief efforts since 9/11. Hurricanes, tsunamis, and other major disasters, they have been there. You should be proud to be associated with such an active association. Get involved or stay involved, and keep contributing to your PAC. Because in years to come, you will need it. There is legislation on the rise in our industry from possible deletion of the mortgage tax deduction to the qualified residential mortgage that will affect realtors more than ever.

So changing the subject......Since April, the rates have come down almost .75%. On a $300,000 home, that is $90/month LOWER in monthly payment! Your buyers can qualify for more house than ever before! And while it seems that these low rates will be here forever, we need to be more realistic than that. In fact, one of the mortgage commentaries I subscribe to said this today; “with loan volume through the roof, and lenders barely able to handle current volumes, why would they offer better pricing?' That's a good point! In fact, from time to time we will see one of our investors have awesome pricing one day, only the next to shoot up, pricing themselves out of the market. It’s a basic strategy of curbing loan volume.

Current economic conditions look like, for the short term, rates should hold steady through the end of the year. Initial jobless claims were higher than expected, and Bernanke gave no warm fuzzies about the economy this week. He called the current situation dismal, offering no hope in sight. A total of 7 million people are collecting some type of unemployment. With news like this, bonds are sure to be popular for the near term as investors remain skittish about investing in the stock market.
That’s all I have, enjoy the weekend and this glorious weather.

RATES as of September 9, 2011 (UNCHANGED for the week)

The following assumptions apply:
• 20% Down Payment (Conforming) / 25% Down Payment Jumbo (Lower down payments available – call for details)
• 1% Origination Fee
• Escrows Required (if no escrow, higher fees may apply)
• Purchase Transactions, Primary Residence (Refinances have different rates)
• 30 day closing
• Credit Score 740 +
• Debt to income ratio <=40%
• Full Documentation of Income/Assets

Conforming ($200,000* - $417,000) Jumbo ($417,001- $1,000,000*)
10 year (fixed) 3.250% APR 3.593% 15 year ( fixed ) 3.875% APR 4.084%
15 year (fixed) 3.250% APR 3.487% 30 year ( fixed ) 4.500% APR 4.622%
30 year (fixed) 3.950% APR 4.086%
7/1 ARM 3.125% APR 3.223% 5/1 ARM 3.250% APR 3.408%
7/1 ARM 3.625% APR 3.577%
10/1 ARM 4.000% APR 3.761%

FHA/VA call for quote (max loan $270,000) 5/5 ARM 3.625% APR 3.223%


We do originate loans below $200,000. These amounts are chosen to show the most favorable rates.
For other product options or for loan amounts less than $200,000 or above $900,000