Weekly Recap (04/11/11-04/16/11)by Tim Manni
So, you’re getting ready to purchase a home…You’ve got your credit up to snuff, you’ve asked yourself, “How much house can I afford?” and you’re shopping around for the lowest mortgage rates…Seems as though you’ve got all your bases covered so far. But wait, have you given strong consideration to how you will protect what is likely to be the biggest purchase of your life?
As Barb Marquand writes in her latest contribution to HSH.com, while home insurance may not be at the forefront of your mind when you’re buying a home, it certainly deserves your utmost attention…
If you follow what I write about on this blog even somewhat closely, you’ll know that I often refer to home prices as “the statistic that matters most.” I’ve written several times that home prices are an important economic indicator — a tell-tale sign of how the overall economy is progressing. I’ve said, until home prices get back on track, this country’s economy will continue to suffer.
Dan Green, a loan officer in Cincinnati and regular contributor to HSH.com, offered a different spin on the importance I’ve placed on home prices. It’s not that Green necessarily disagrees with me, but according to him, there’s something homebuyers should worry about more when they’re shopping for homes and determining their levels of affordability: mortgage rates…
Current mortgage rates for 30-year fixed rate loans are still at historic lows. Granted, they may not be as low as they once were, but in the grand scheme of things, these mortgage rates are still fantastic. That said, borrowers looking to land an even lower mortgage rates are considering adjustable rate mortgages (ARMs).
Would you be better off with an ARM, even though current fixed-rate loans are not far from their rock-bottom lows?
Homeowners: Do you trust that your mortgage servicer truly has your best interest in mind? How confident are you that if or when you enter into financial trouble, your mortgage servicer will be there for you, willing and able to help you remain in your home?
With all the negativity surrounding the mortgage servicing industry these days, it stands to reason that a large percentage of borrowers wouldn’t place too much trust in their servicer to help them through a rough financial patch. The amount of confidence you have in your servicer’s willingness to help you stay in your home could even influence your opinion on whether or not the home affordable modification program (HAMP) should end before its slated expiration date (December 2012) or even be extended beyond that…
As of late Friday (April 8, 2011) afternoon in Washington D.C., an agreement to continue the operations of the national government for a few days had been reached, but the lack of a longer-term arrangement raises a question: How would the mortgage and real estate markets be impacted if the government did shut down?
The real question concerns the Federal Housing Administration (FHA). It has a huge presence in the marketplace, and there’s no doubt that the FHA would stop processing loans in the event of a shut-down which lasted past the weekend. As HUD explained to lenders Friday evening, “FHA loans will not be endorsed during the government shutdown period”…
Every action has a reaction. If you’re a potential homebuyer and/or refinancer, a dip in mortgage rates should certainly prompt you to act. As the title of our latest Market Trends Newsletter suggests, mortgage rates continued on their upward trend last week, and as far as this week goes, not much is expected to change…