Monday, March 29, 2010

Mortgage Rates Expected to Climb

The super-low mortgage rates everyone has enjoyed for more than a year may likely be coming to an end. The Federal Reserve is expected to end their campaign of buying up mortgage-backed securities this week.
The Federal Reserve Bank, last March began a 1 trillion-plus shopping spree to buy up mortgage-backed securities from Fannie Mae and Freddie Mac. This artificial involvement in the mortgage market was the main tool the Fed could use to keep interest rates low. That campaign is scheduled to be wrapped up Wednesday March 31st, the end of the first quarter.
Many experts predict this will cause mortgage rates to spike up. If you have been considering a refinance or purchase it may be best to pull the trigger before rates do go up. It seems inevitable at this point.

Call Today to lock in your low rate! 773-529-7000

Thursday, March 18, 2010

Source: Market Watch March 18, 2010, 1:21 p.m. EDT

The number of people applying for unemployment benefits fell by 5,000 in the latest week, marking the third straight drop, but there's little evidence companies are ready to hire at a pace that would sharply reduce the nation's high jobless rate. Unemployment predicted to stay high for some time.

Yet senior economic officials at the White House repeated a warning this week that unemployment might remain near its current level of 9.7% for an "extended period." White House officials predict the economy will add an average of 100,000 jobs a month in 2010, but that would just keep pace with natural growth in the labor force. Jobs would have to be created at double that pace to sharply reduce unemployment.

To help millions of workers who can't find jobs, Washington is set to extend benefits until the end of the year. Regular unemployment benefits run out after 26 weeks.Lawmakers this week also passed another stimulus bill, worth $17.6 billion, aimed at creating more jobs. Included in the measure are temporary tax credits for businesses that hire additional workers.

In the week of Feb. 27, the number of workers receiving extended federal benefits climbed 352,000 to 6.04 million, not seasonally adjusted.Altogether, 11.65 million people were collecting some type of unemployment benefits in the week of Feb. 27, up from 11.36 million. The numbers are not seasonally adjusted.

Wednesday, March 17, 2010

Home Affordable Foreclosure Alternatives-HAFA-Kicks off April 5

The new program, Home Affordable Foreclosure Alternatives, or HAFA, kicks off in April 5. Some real estate industry experts see it as a response to the limited success of a government loan modification drive known as the Home Affordable Modification Program, or HAMP.

Under the new HAFA program, if a homeowner doesn't qualify for a HAMP modification they must be offered a short sale. Borrowers can also be offered a deed in lieu of foreclosure.
Homeowners who qualified for a HAMP modification, but have missed two consecutive payments, will also be offered a short sale or deed in lieu through HAFA.

A short sale happens when the borrower and the mortgage servicer agree to sell a home for less than the value of the loan or loans. A deed in lieu of foreclosure occurs when a homeowner voluntarily gives the deed of the property to the servicer.

To help kick-start HAFA, there are government incentives. Borrowers get $1,500 to help them move to a new home and up to $3,000 in short sale proceeds can be given to holders of second mortgages on the homes in the program.

Need Help With Your Mortgage?

Tuesday, March 16, 2010

Fed stands pat on rates-But will mortgage rates go up?

Although the Federal Reserve kept its benchmark interest rate at a record low level Tuesday and made no changes to the key "extended period" policy pledge, a signal that it believes the economy still needs support to get to a sustainable path.

Many are predicting the long term mortgage rates to spike upward. Primarily due to the fact the Fed's buying of mortgage backed securities comes to an end at the end of this month. This has a direct impact on mortgage interest rates that were held at historical lows by the Treasury buting Mortgage Backed Securities creating a false market.

If you have been considering a refinance, or a purchase it may be a good idea to move forward sooner rather than later.

Call Today: 773-529-7000

Monday, March 15, 2010

Homebuyer Tax Credit Creating Activity

With the Homebuyer Tax Credit deadline of April 30th fast approaching, there has been a substantial increase in potential buyers calling to get Pre-Approved. With the mad rush to secure a contact by April 30th and close by June 30th. There will be a log jam so to speak getting loans through underwriting and scheduled with the title companies.

Call or visit my website today to beat the rush.

Friday, March 12, 2010

Shows true cost of borrowing

That’s essentially how the APR works. It takes any fees you pay for a mortgage loan or refinance, and recalculates their cost as part of an interest rate. It’s a handy way of comparing loan offers with differing fees and interest rates. For example, you may have one loan offer at 5.5 percent, zero points and $2,500 in fees, vs. another at 5.25 percent, two points and $7,000 in fees. Your APR on the first might be 5.6 percent, but 5.75 percent on the second. The first loan is the least expensive, even though it has a higher interest rate.

The APR can be used to compare offers on adjustable rate mortgages, even though the rates may fluctuate over time. The way that works is, the APR is calculated assuming you’ll have the mortgage for the full term of the loan and simply pay the new rate whenever it resets. Because no one can predict what interest rates will do in the future, the calculation simply assumes the base rate, or rate index, that rate resets are based on will remain unchanged, so the calculation simply depends on how much the resets
vary from the base rate.

Call Us Today!! 773-529-7000
Visit Us On The Web:

Thursday, March 11, 2010

Get Preapproved Before You Start Home Shopping

Getting a mortgage can be difficult these days. So when shopping for a new home, it helps to be Pre-Approved before you start your search or make an offer to a seller.
A Pre-Approved mortgage means that a lender has already reviewed your income, credit and assets to verify that you can qualify for the mortgage you’re seeking. It shows a seller that you’re serious about buying a home and can deliver on your purchase offer, which puts you in a better position to negotiate.

Pre-Approved means you’ve passed a higher level of lender scrutiny than someone who’s simply been Pre-Qualified. The latter simply means the lender thinks you ought be able to qualify for a mortgage, based on your finances as you describe them. A Pre-Approval means the lender has confirmed it.

At Chicago's Mortgage Choice our team is committed to providing our clients with the highest quality financial services combined with the lowest rates available in your area.

Call us Today 773-529-7000

Wednesday, March 10, 2010

Home Purchase Motivation in April 2010

The $8,000 first-time homebuyer and $6,500 repeat homebuyer tax credits can only be taken on homes for which sales contracts are signed by April 30, though buyers have until June 30 to actually close the sale. Congress already extended and expanded the credit after it was originally due to expire last November; there doesn’t seem to be much support for extending it again, so if you miss the April 30 deadline, you’re probably out a luck on this one.

A potentially bigger impact will occur when the Fed buys the last of $1.25 trillion in mortgage securities it has been purchasing over the past year. Also scheduled to conclude on April 30, the program has been credited for driving mortgage interest rates to record lows in the spring and again in the fall of 2009, and keeping them at or below 5 percent for most of the year.

Though 30-year fixed rates held steady around 5 percent through Jan. 2010, most observers expect them to rise sharply once the Fed purchase program concludes. Many observers expect rates to almost immediately shoot up to 6 percent and hold there, an increase of a full percent. On a $250,000 30-year loan, that 1 percent translates to an additional $150 a month, or $1,800 a year.

Finally, in early April the FHA is increasing the mortgage insurance premium it charges on all loans by half a percent, from 1.75 percent to 2.25 percent. A onetime fee charged upfront at the time of closing, it means that the premium on a $150,000 FHA loan would increase by $750, to $3,375. However, this only applies only to borrowers seeking an FHA-backed loan, although those are making up a larger share of the market.