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Monthly Archives: December 2012

Reports Show Interest Rates Remain Near All-Time Low

Government-secured mortgage backer Freddie Mac released its weekly Mortgage Markets Index today, which showed average interest on fixed rate loans remains near all-time lows.

The 30-year fixed-rate mortgage, considered the industry benchmark, saw its interest rise to an average of 3.37 percent, up from 3.32 percent last week. This marked the largest jump in interest for this loan type in weeks, although it is still well below last year's figure, which hovered near 4.0 percent over the same period.

Refinances Expected To Drop Off In 2013 As New Loan Applications Increase

Over the past year, refinance has been the driving force of the mortgage market, at times accounting for roughly 84 percent of the total application volume. Although loan modification has been a boon to the overall national economy, the number of homeowners who are projected to take advantage of refinance in 2013 is expected to fall markedly.

This anticipated decrease isn't a sign that conditions are no longer ripe for refinance, but that government-backed programs enacted to boost the housing market are finally paying off.

Another Refinance Program Being Mulled Over In The Treasury Department

President Barack Obama has been spearheading numerous efforts to help the housing market regain a strong footing going into his second term in office. Despite already having drafted numerous initiatives to help make home ownership more affordable for citizens, a wide swath of borrowers remain underwater on their mortgages because they are ineligible for government programs.

Bloomberg reports that along with modifications to the president's Home Affordable Refinance Program (HARP 2.0), which helps borrowers with government-secured mortgages, a new aid package is on the table that would help homeowners with privately backed loans.

Consumer Confidence Increases As 2013 Approaches

Recent surveys have found that the attitude of the average American homeowner has drastically improved going into 2013 than during the same period last year. The driving force for the change of heart is the state of the national housing market, which has seen a substantial rebound over the past 12 months, signalling a large step toward economic recovery.

Fannie Mae, a government-secured mortgage backer, conducted a survey of over 1,000 households to gauge how the average American viewed the national economy as the new year approaches. The results raised 11 key indicators that signal real and positive recovery following the Great Recession.

As The Nation Approaches The "Fiscal Cliff," Homeowners Refinancing In Droves

As President Barack Obama and Congress continue to hammer out a plan to avoid the dreaded "fiscal cliff," a phrase coined to describe the wide-ranging tax increases and budget cuts that mark the end of the Budget Control Act of 2011, mortgage refinance has seen an unprecedented surge.

According to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey, lenders saw an increase of 8 percent in the number of refinance requests fielded. This figure brought the total for all mortgage applications up a significant 6.2 percent on average.

Many Homeowners Take Advantage Of Refinance Often And Early

Because mortgage rates have continually dropped to all-time lows seemingly every couple of weeks, homeowners have swarmed to take advantage of mortgage refinance. The phenomenon isn't just affecting those who had purchased their homes before the housing bubble burst, as many analysts had assumed. Instead, a batch of homeowner who have either recently purchased new properties or have refinanced their mortgages already over the past year have been reducing their already low interest payments in droves.

For homeowners who are restructuring their mortgages within their first year of homeownership have found, in many cases, that they are able to reduce their monthly interest payments by as much as 0.75 percent in some instances.

Where Sellers And Buyers Are Faring Best Coast To Coast

Homeowners in the Southwest are currently enjoying a serious seller's market as home values across the region are rapidly appreciating in value. According to Zillow, a real estate monitoring group, metropolitan areas specifically in California are seeing a resurgence in the market that is allowing sellers to demand prices not seen in the region since before the recession.

The three cities on the top list of best seller's markets are concentrated in the central part of California, with San Francisco, San Jose and Sacramento coming in first, second and third, respectively.

In Recent Years, FHA Home Loan Has Seen Unprecedented Surge In Popularity

Following the crash of the housing market in 2007, the number of mortgages that were financed through the Federal Housing Administration (FHA) surged from less than 5 percent of total loans to more than 40 percent by the third quarter of 2008.

One of the big reasons for this change was the fact that before the housing bubble burst, financing a new mortgage was a much simpler endeavor for homeowners to undertake. During a robust market, minimal paperwork was required of borrowers looking to take out a loan through traditional means. However, the Great Recession hit a lot of borrowers hard, diminishing lines of credit and dissolving the amount of money potential homeowners had saved to make initial deposits.

Refinance Application Continues Weekly Increase

Mortgage refinance continues to lead the way in helping the housing markets inch toward a strong recovery as the number of applications rose to 83 percent of all mortgage filings for the week ending December 6.

The Mortgage Bankers Association (MBA) reported that refinances increased by 4.5 percent from the week before. The number of homeowners who restructured their loans to achieve lower monthly payments the previous week had seen an uptick of 6 percent, a sign that momentum is building for initiatives that take advantage of record low interest rates.

Rates Dip Again As 2012 Comes To A Close

According to figures from the Mortgage Bankers Association's (MBA's) weekly index, the housing market saw yet another week of positive news. Not only has average interest on fixed-rate mortgages slid to 3.43 percent from the week before, the volume of applications being filed has risen for both new loans and refinance.

Mortgage refinance has seen an uptick of 6.0 percent over the previous week, figures from the MBA show. At the same time, more potential homeowners had taken advantage of the record low rates to apply for new home loans, as the index showed an increase of 0.1 percent in mortgage applications overall.