Estimated rates for the week of March 17, 2009
Conforming 30 yr fixed 4.75 - 5.00
Jumbo 30 yr fixed 5.75 to 600K
7/1 ARM 4.75 - 5.00 jumbo and conforming
Oregon Bond 4.50 conventional and FHA
Oregon VA 5.25 w/1.50 or 5.375 w/1.00
Rates aren't moving much - they are staying in a very tight range. My guess is that we will continue to see this range throughout the year. Looks like the market is thinking that the Fed likes the 3.00 (or below) rate on the 10 year Treasury. That's keeping our mortgage rates steady. Personally, I am very happy to see the rates stay in this range. Getting a rate with a four in front of it is great. The longer it lasts the better.
We have been seeing the beginning signs of an end to this recession. Housing starts throughout most of the country were up big - here in the West they down though. Better for us to get the inventory levels lower. The stock market may have put a bottom in. We are up about 10% from the lows and hit a monthly high today. We have had a number of the 'too big to fail' banks state that, so far this year, they are profitable. That's a good sign and one that hopefully means they could start lending more. The current 'mark -to-market' policy is up for a revision. That will definitely help the banks with their profitability and their desire to increase their lending. And yesterday it was announced that as part of the Financial Stability Plan, among many other items, there is now the ability for small business owners to carry-back their losses for up to five years, effectively allowing them a rebate on taxes paid in previous years. That could put some money into the hands of the self-employed. You add all of these together along with Mr. Bernanke's recent comments and one can see that things are starting to get better.
As for our mortgage business, it looks like most of the lenders are finally getting caught up. Transactions can be difficult but they are getting done. The Administration's Home Affordable program should be out to the masses soon and there's a good chance that it will prevent many foreclosures. Come April 1, FHA will limit cash-out refinances to 85%. There is talk about some mortgage insurance companies restricting debt-to-income ratios further for the loans that they insure. Looks like some will max it out at 41%. All the more reason to accept FHA financing - remember that FHA now goes to $417,000 in our tri-county area. As far as appraisals are concerned, it looks like the new Home Valuation Code of Conduct will be out and enforced in May. Come April 1st, all appraisals on Fannie and Freddie loans will be required to complete a Market Conditions Addendum. This form requires much greater detail on current marketing times, absorption rates and inventory analysis. Although I haven't heard from any appraisers, I wouldn't be surprised to see an increase in their fees and a small delay in the completion of the report.
That's all for this week. Please feel free to email or call if you have any questions.
Bob Chiodo, CFP
Equity Home Mortgage, LLC
12550 SW 68th Parkway
Portland, OR 97223
(503)670-7393
fax: (503)670-7062
*Rates quoted are for the use of Realtors and others in the real estate/financial service industries. They are not meant to be a quote for an individual situation. Rates change daily and those above are only listed to assist market participants by keeping them informed of current interest rates. Credit scores, down payment, and other risk related issues may change the rate. Quotes are usually shown for a 30 day lock period and a 1% origination or discount fee (1.75% for the Oregon Bond).
