Mortgage Rate Update – End of the Ride?
By: Mark Simons
Apr. 3, 2010 Rates for yesterday’s POV* came out and had one or two Lenders repricing for the better. Most Lenders closed early due to Good Friday but the inching up of the rates continued. Conforming rates at 5.0% and High Balance at 5.25% with Super Jumbos at 5.75%. Scenarios and questions can be sent to lololoans@yahoo.com.
So…was it good for you? Rates have been steady and some will attribute that to the Federal Reserve Bank’s extraordinary move of purchasing Mortgage Backed Securities therefore adding stability to the Bond Market; however, this came to an end on the 31st of March. Already the Fed exit has had an impact on Mortgage Rates. Uncertainty in the Market is probably what has had rates creeping up this last week so we shall all be waiting with baited breath as next week’s events and news items play out.
Heloc vs Cash out Refi: No, this is not a Japanese monster movie from the 50′s. If you find yourself needing cash for reasonable items such as a new roof, College for the kiddies, new Kitchen etc but NOT for “mad money” to buy new shiny objects, then you will have to make the decision to go with a HELOC (Home Equity Line of Credit) OR to refinance your existing 1st mortgage with cash out to you at Close of Escrow. Remember, that as the Economy recovers, Interest rates stand to go UP and since the HELOC is based on the Prime Rate, not the Mortgage Bond rates, you stand to see that 3% rate go through the literal roof. The Cash out option allows you to get the cash, at today’s pretty good rates and fix the rate for 30yrs. Something to think about…
*POV = Plain, Old, Vanilla Home Loan: 30yr fixed, fully amortized, single family residence, owner-occupied, at least 20% equity. No witty tag-lines today, just a Happy Easter, Passover and END of Spring Training to all!