If you’re a recent homebuyer or were lucky enough to refinance your mortgage, the low interest rate environment created by the Federal Reserve has allowed you to lock in a historically low mortgage rate for perhaps the next 30 years.
To illustrate what that means in terms of savings, let’s do a quick calculation:
Rates on the most popular types of mortgages moved upward, according to HSH.com’s Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages rose by seven basis points (0.07 percent) to 3.68 percent. Conforming 5/1 Hybrid ARM rates increased by three basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.62 percent.
“After reaching lows for the year just four weeks ago, and despite plenty of mixed economic signals, 30-year fixed mortgage rates have quickly moved back to near this year’s highs,” said Keith Gumbinger, vice president of HSH.com. “Rising stock markets, with their promise of better returns, continue to draw investor money out of safe-haven investments such as bonds. Yields are increasing as a result, pulling mortgage rates along with them.”
House prices increased 7.3 percent in 2012, the strongest rate of appreciation in nearly seven years, and are projected to continue to rise, albeit at a slower annualized rate of 3.9 percent through 2017.
That’s according to a new analysis of home price trends in more than 380 U.S. markets by CoreLogic, a residential property analytics company. The analysis is based on the CoreLogic Case-Shiller Indexes, owned and generated by CoreLogic and supplemented with data from the Federal Housing Finance Agency
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Below is an excerpt from of our latest Market Trends newsletter, Keith Gumbinger’s latest examination of the economic conditions that influenced mortgage rates. Sign up to receive the Market Trends in your inbox Friday evening.
As the economy oscillates, so go mortgage rates. A spate of poor economic news pushes mortgage rate down; optimism about the economy lifts them again.
The Home Affordable Modification Program (HAMP) has been a disappointment for many of the homeowners it was supposed to help, judging by the latest quarterly report to Congress issued by the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP).
Launched in early 2009, HAMP was supposed to offer permanent home loan modifications to help as many as 3 to 4 million homeowners avoid foreclosure. But as of March 31, only 862,279 homeowners had active permanent HAMP loan modifications, and that figure was expected to decline since more than 312,000 homeowners had already redefaulted on a HAMP permanent modification.
Rates on the most popular types of mortgages moved higher, according to HSH.com’s Weekly Mortgage Rates Radar. The average rate for conforming 30-year fixed-rate mortgages rose by eight basis points (0.08 percent) to 3.61 percent. Conforming 5/1 Hybrid ARM rates increased by two basis points, closing the Wednesday-to-Tuesday wraparound weekly survey at an average of 2.59 percent.
“Underlying interest rates are moving higher, dragging mortgage rates along with them,” said Keith Gumbinger, vice president of HSH.com. “This has come as the result of somewhat better conditions in the labor market, helping investors feel more confident that the recovery will overcome its recent soft patch.”
The latest survey of Senior Loan Officers found an acceleration in the easing of underwriting standards for Commercial and Industrial loans, continuing a now five-quarter trend. Demand for these kinds of financing was improving, too, so cheaper money may be becoming easier to get for business concerns.
The Fed’s survey also noted another easing in standards for “prime residential mortgages,” with about 8 percent of respondents to the survey noting easier terms and conditions. Given that something on the order of 90 percent of loans today kowtow to the still-stiff standards of Fannie Mae, Freddie Mac and the FHA, this leads us to a few thoughts, speculations and conclusions. Read the rest of this entry »
Below is an excerpt from of our latest Market Trends newsletter, Keith Gumbinger’s latest examination of the economic conditions that influenced mortgage rates. Sign up to receive the Market Trends in your inbox Friday evening.
There were not many fresh additional economic signals out last week to work with, but with the better-than-hoped for April employment report driving stock markets higher, less might actually be better, since rising equity prices often drag interest rates upward with them.
We’ve been talking a lot lately about the different factors that contribute to a home holding its value over time. A home near good schools and one that’s close to public transportation are two such factors. But also, homes with “walkable” streets are another important factor for many of today’s buyers.
Below is a post by Krissy Schwab, first appearing on our partner site the Zing blog at Quicken Loans:
The appointment of Rep. Mel Watt, D-N.C., to head of the Federal Housing Finance Agency, the overseer of Fannie Mae and Freddie Mac, could have a substantial impact on the Home Affordable Modification Program (HAMP).
Rep. Watt supports principal reductions, or at least he has supported them in the past. Acting head of the FHFA, Ed DeMarco, has been mostly opposed to principal reductions, causing some to call for his job.
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.
