Oregon Bond Loan Rate Volatility

We just received notification from the State that they reserve the right to adjust the interest rate on the Oregon Bond Loan programs, RateAdvantage and CashAdvantage, just as any market interest rate published by the banks and lending companies. Lending professionals will need to check the Oregon Bond Loan's Reservations website for the most up-to-date interest rates when quoting these programs to qualified buyers.

In the past, Oregon Bond Loan interest rates have not fluctuated very often. Nor, have they fluctuated very much when interest rates are raised or lowered. This past increase effective March 3, 2008 was the largest one time increase I have seen - .45% over the previous interest rates published for the RateAdvantage and CashAdvantage programs. A bit too high, in my humble opinion, since equivalent market rates were at 6.125% on the conforming 30 year fixed program. Oregon Bond Programs are designed to be 3/4%-1% lower than the equivalent market rate, so the interest rate should be 5.375% or less.

That being said, Oregon Bond Loan is still a great loan program for qualified First Time Home Buyers - those who have not owned a home in the past 3 years - purchasing in Oregon. In the Jackson County Cities, Ashland - Medford - Talent - Phoenix - Jacksonville - Central Point - Eagle Point - Shady Cove - Gold Hill - Rogue River, it is still a great option for First Time Home Buyers who qualify. In certain areas in the City of Portland, qualified First Time Home Buyers may choose the Mortgage Credit Certificate program instead of the Oregon Bond Loan. Those buyers who have higher income ranges may benefit more from the Mortgage Credit Certificate, a dollar for dollar tax credit, than they would from the lower interest rate of the Oregon Bond Loan.

As always, choose knowledgeable, experienced professionals to work with you on successfully closing your purchase transaction.

See you at the Closing Table!

Karen Cooper - OR/CA Mortgage Consultant - www.Quality4Loans.com