Mortgage Rates: Home Prices Gain for Tenth Straight Month
By: Rosemary Rugnetta | February 5th, 2013
Home prices gained for the tenth straight month in December, up 0.4% as compared to November 2012, according to CoreLogic, a data analysis firm. Including distressed sales, nationwide prices increased on a year over year basis by 8.3% compared to December of 2011. This is the biggest increase since May 2006. Across the country, 46 out of 50 states showed improvement; more evidence pointing to a continued housing recovery.
Today’s 30 year fixed mortgage rates are as low as 3.125%, 15 year fixed mortgage interest rates are as low as 2.375% and 5/1 ARM loan rates are as low as 2.375%. Lender guidelines remain strict and make it necessary for borrowers to have good credit in order to receive low rates. Documenting employment, income and assets is necessary so that the lender can prove and verify the information. After examining the loan file, additional information is often required to support the loan decision. For HARP loans, documentation is streamlined and an appraisal is not necessary in most cases. The HARP program, Home Affordable Refinance Program, is for underwater borrowers who have loans that were sold to Fannie Mae or Freddie Mac prior to June 1, 2009. Some borrowers who are eligible for HARP refinances may find it difficult to receive approval even though HARP does not have loan to value caps. It is important to keep looking for a lender while HARP 2.0 is still available. This search can easily be done by submitting the online form which does not require a social security number, but will return a response almost immediately. The form is available for information about any type of mortgage.
Current FHA 30 year fixed mortgage rates are as low as 3.250%, FHA 15 year fixed mortgage interest rates are as low as 2.750% and FHA 5/1 ARM loan rates are as low as 2.250%. Many consumers need FHA loans in order to purchase a home with a low down payment. Now is the time to get in an FHA application before mortgage insurance premiums increase and guidelines change starting April 1st. While FHA has easier credit guidelines, the minimum credit score is going up to 620 and anything below that will require manual underwriting and compensating factors in order to receive approval. FHA closing costs (APR) are high because of the upfront mortgage insurance premiums and other FHA fees. These expenses can often be paid with seller concessions. The FHA streamline refinance is available with no cash out and does not require an appraisal, a credit history or any other documentation. It is the perfect refinance for FHA mortgage holders who are underwater, meaning they owe more on the mortgage than the value of the property. Homeowners who have loans that were FHA endorsed prior to June 1, 2009 can receive drastically reduced upfront and annual mortgage insurance premiums when using the FHA streamline program to refinance. Since borrowers can use any FHA approved lender for FHA purchase and refinance loans, the online form is available for submission and will return a response almost instantly.
Today’s jumbo 30 year fixed interest rates are as low as 3.250%, jumbo 15 year fixed mortgage rates are as low as 2.700% and jumbo 5/1 ARM loan rates are as low as 2.500%. Jumbo loans require that borrowers have excellent credit in order to receive low jumbo rates. Borrowers are required to submit documentation for employment, income and assets according to the guidelines of the lender. In some cases, more than one appraisal will be required by the lender. Guidelines and jumbo rates vary from lender to lender which makes it necessary for borrowers to shop around. For more information about jumbo loans, the online form is available for submission.
MBS prices (mortgage backed securities) are down -14/32 (FNMA 30 yr 3.0 at 103.06) which is close to earlier levels. Mortgage rates are affected by MBS prices which move in the opposite direction. The Institute for Supply Management reported that the U.S. services sector index fell slightly to 55.2 in January from 55.7 in December.
FreeRateUpdate.com surveys more than two dozen wholesale and direct lenders’ rate sheets to determine the most accurate mortgage rates available to well qualified consumers at about a 1 point origination fee.
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