November 21st, 2010

Weekly Recap (11/15/10-11/20/10)




5 reasons people don’t refinance“:

There are millions of homeowners out there who have already refinanced their mortgages. Some are even considering refinancing for a second time. However, it may surprise you that there are still many borrowers out there who haven’t refinanced. Here are five reasons why:

1. Small Loan Amount

With a small loan amount, it can be hard to achieve enough savings by refinancing to make the transaction worthwhile…


Mortgage borrowers: Good credit is more important than ever“:

Now more than ever, credit scores are especially important to mortgage borrowers. If you’re a mortgage borrower with a poor credit score, your financing options are vastly limited. Besides the FHA, which still has financing available for borrowers with below-prime scores, the private market has shown little interest for borrowers without pristine credit.

The good news is that there are ways you can improve your credit before you apply for a home loan…


If principal reductions are working, why aren’t more being done?“:

“If you want successful modifications, you have to do principal reductions.”
-Laurie Goodman, Senior Managing Director of ASG

How many times have we heard that before? To put it simply, “a lot.”

Principal reductions are a very gray area in this era of loan modifications, especially when it comes to Fannie Mae and Freddi Mac. While neither the public or private market has yet to claim much success in terms of loan modifications, statistics are starting to sway in the favor of private-market modifications, rather than HAMP modifications…


Ouch! Not a good day for housing“:

Today was not a good day for the housing market. A group of negative reports revealed a market that still hasn’t found much solid footing at all.

Mortgage rates are trending upward: The 30-year Conforming fixed rate has risen appreciably in the last few days. According to HSH.com, the 30-year fixed ended the day at 4.54 percent, unchanged from yesterday.

Mortgage applications suffer: Both purchase and refinance applications dropped for the week ending November 12, according to the Mortgage Bankers Association. Purchase apps were down 14.4 percent from the week prior, and refinance apps fell by 16.5 percent, “the lowest level observed since July of this year,” writes Jann Swanson of Mortgage News Daily


Fed defends against QE2 criticisms“:

New York Fed President Bill Dudley gave an interview recently with CNBC in which he defended some of the most common criticisms of the Fed’s QE2 program.

Criticism #1: Quantitative Easing will cause inflation:

Dudley contended that new tools the Fed has put in place to withdraw excess cash from the banking system when the economy rebounds would head off inflation, including paying higher interest rates on the excess reserves banks are now holding. “We are very confident of our ability to exit when the time comes, in terms of the tools. We also are very confident of our will to exit,” Dudley said…


Rates move higher as day comes to an end“:

Today, mortgage rates for the 30-year Conforming fixed-rate mortgages increased by 0.16 percent from Friday, producing the highest daily rate since September 20, 2010.

The Influential 10-yr treasury increased to 2.96 percent, marking the highest daily average since August…

Fed’s QE2 program off to a rocky start“:

The second round of the Federal Reserve’s Quantitative Easing (QE2) program kicked into gear last week. So far, it’s not producing the desired effects (at least in terms of influencing interest rates downward). Before we get too ahead of ourselves, allow me to reiterate that the program has just gotten underway. Let’s allow the program to get going before we draw any concrete conclusions…

That said, what we do know for sure is that the effects of this program are largely unknown. For the most part, QE2 is an unprecedented undertaking without knowable outcomes.

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

Our bloggers:

Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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