Mortgage Blog

I haven't blogged for a long time.....several months.  I've been extremely busy with work, along with moving offices and my wife and I having another baby girl.  It seems as though we're in another little mini-refi boom again, although nothing like the first time around back in 2002-2003.  Rates are great....4.875% ball park.....and many people are taking advantage of them by refinancing, but there are also a lot of new home buyers that want to take advantage of the 10%/$8,000 tax credit that's available for anyone buying a home that hasn't bought one in the last three years.  Talk about a great reason to buy a house.  That's a no-brainer there.

On the new office, we're now located downtown in Wellington, KS, at 201 N. Washington.  I'd been waiting 3-4 years on this building to be completed and it finally is so we're finally in it.  It's great and we really love it.

I really could use some help here......Is there anyone out there actually reading this?  If you are if you could just leave a comment, even if it's your fake name or something...that'd be great.  Otherwise I might just stop writing.  This blog is meant to help my site surface on search engines, but if noone reads it I might just retire for good.  Hopefully some of you have picked up a few mortgage industry tidbits.

Thanks,

Colby

Rates are now into the 4's.  If you have any debt do consolidate or just want a lower interest rate and a lower payment, now would be the time to refinance. 

Colby

The government announced their bailout plan for borrowers who are defaulting on their mortgages today.  What I am most concerned with is that it only affects the people that have loans through Freddie Mac or Fannie Mae.  I'm concerned because the loans through Freddie and Fannie are almost all Fixed Rate loans that people with good credit qualified for.  In other words, it doesn't help the people in the 2/28 3/27 adjustable rate mortgages at all, because those were all sold to private investors, not Freddie/Fannie.  This doesn't seem to be much of an effort to help stop forclosures.  The two major problems and causes of the "Mortgage Crisis" are those 2/28 ARM loans and the housing bubble that burst.  The majority of mortgages in forclosure are on an ARM or the borrower is upside down on their home and don't care to make the payment anymore.  This "rescue package" for the Mortgage Crisis doesn't appear to me to be very strong at all.  I'm not sure that it will help more than a small percentage of the people out there that actually need help.

Colby

If you're thinking about building a new home and wonder how the financing works, I'll give you a quick run down on the options we have.  We offer a One-Time-Close loan that sets up the contstruction financing and permanent 30 year or 15 year fixed financing all at the same time and we have the closing before ground is broken.  Some advantages of this is that it gets everything out of the way in one closing and you avoid paying twice for mortgage taxes and appraisals.  The disadvantages of doing this is that the interest rate could be higher on the permanent loan and it's sometimes difficult to find a builder that would qualify for or be willing to work with you on this type of loan. 

The more popular, simple, and flexible way of lining up the financing for building a new home is for me to set you up with a seperate loan for the construction part, which we can also use to buy the lot with right from the start, and then pay that loan off with a seperate permanent loan.  The second loan then becomes a refinance, which means the loan amount is derived from an appraised amount and not from a construction cost figure.  This is a much smoother way of financing the construction of the house, and the builder's prefer this on their end as well, because they don't have to qualify for the financing themselves.

Colby

We also have a new set of 30 year fixed mortgage options that are available for people with FICO/Credit Scores all the way down to 500.  These are a much more conservative version of the old Alt-A "Sup-Prime" loans that are very safe for the mortgage industry and are also very helpful for people who cannot qualify for an FHA loan.  No matter how bad you think your credit is, make sure you give it a shot at getting approved before you give up.

Colby

The interest rates have taken quite a dive this week due to Fannie Mae and Freddie Mac being somewhat taken over by the Federal Government.  We are back in the Mid-5's for the first time since March. 

Colby

By next week, we should be up and running on our Rural Development Loan program which will give us a complimentary option to our FHA first time homebuyer loans.  I am really looking forward to being able to offer this great product. 

Colby

I still have a few options for Self-Empoyed people that need stated income loans.  Most programs require a 720 Credit Score and a maximum Loan to Value of 75%, or in other words a 25% down payment.

Colby 

The bond yield is back down around 3.8, which has helped lower our rates to around 6.375-6.5% as opposed to the 6.75-6.875% we were at over the last several weeks. 

I have read and seen in the news that Freddie Mac and Fannie Mae, which are the two government sponsored lenders who buy most of the "conventional" loans, are in trouble financially.  I guess FHA may be the only one standing before too long.  Back over the last several years Fannie Mae and Freddie Mac were very loose on there requirements to become approved for a "Flex-100" or 100% Conventional loan.  It seemed like just about any borrower I sent into the system would get approved for a 100% loan at some level.  If they had really bad credit, Fannie/Freddie would just approve them at a level that had a higher interest rate and higher mortgage insurance and give them the money to buy the house.  I'm sure stuff like that is contributing significantly to their current problems.  I'm surprised I don't see more information about the Mortgage Insurance companies that were insureing these loans, like MGIC, going out of business.  Maybe they are in trouble but I just haven't paid that much attention to them.

One last thing....I've noticed that there are a lot of people that read this blog, but I have no idea who any of you are.  No one has ever left a comment.  If you feel like it, it would be good if you could just leave the city/town where you're from in the comment section.

Thanks,

Colby