Mortgage rates are higher after the Federal Reserve released the internal notes of its September 22-23, 2009 meeting.
Known as the "Fed Minutes", the report details the conversation and cross-currents that led to the Federal Reserve's decision to vote "unchanged" on the Fed Funds Rate after its last meeting.
The Fed Minutes are the lengthy companion to the more famous, succinct post-meeting press release.
As a comparison:
The extra level of details is a big deal because Wall Street is perpetually in search of clues about what the Federal Reserve is going to do next.
In the past week, multiple Federal Reserve members hinted that the Fed Funds Rate may rise as early as April 2010. Fed Chairman Ben Bernanke even alluded to it, too.
The minutes revealed that the economy may improve even faster than was previously expected, too.
These acknowledgements are part of the reason why mortgage rates are up. Because the Fed Funds Rate rises to accommodate a growing economy, the prospect of economic recovery is drawing money into the stock market and away from mortgage-backed bonds.
Less demand for bonds means a lower prices which, in turn, leads to higher rates.
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For the seventh consecutive month, foreclosure activity in the U.S. was dominated by a tiny subset of states.
As reported byRealtyTrac.com, more than half of September's foreclosure-related activity occurred in just 4 states:
These states represent just 22.05 percent of the total U.S. population.
Overall, foreclosures are up 29 percent from September 2008 and, while, the data seems negative, defaults are creating some interesting buying opportunities.
Foreclosed homes often sell at a discount as compared to non-foreclosed homes. Cheap prices, low mortgage rates and willing buyers have helped to spur home sales in many U.S. markets. In August, "distressed homes" accounted for one-third of all existing home sales.
That said, buying foreclosures isn't for everyone.
First off, foreclosed homes are often sold "as-is" and may be in perfect condition, or may be inhabitable. If the property falls into the latter category, it's important to get estimates for the work needed to make the home livable. Suddenly, the home may not seem like such a "steal".
And, secondly, buying a home in foreclosure can be a 3-month process or more. For some people, this is just too long.
Buying a home in foreclosure is fundamentally the same as buying a "regular" home -- there's a contract and a closing. But most of the steps in between are different.
Read the complete foreclosure report, plus take a peek at foreclosure heat maps on the RealtyTrac website. If you like what you see, talk to your real estate agent about what to do next.
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youtube channel: http://www.youtube.com/midwesthomeloans
Visit msnbc.com for Breaking News, World News, and News about the Economy
When you own a home with a spouse or partner, the issue of what's mine, what's yours, and what's ours can be a divisive one.
Each household has its own money management methodology and, according to financial talk-show host Suze Orman, most leave significant room for improvement.
In this 4-minute piece aired on NBC's The Today Show, Orman talks about co-managing finances with topics including:
Being aware of money is the first step towards protecting it.
website:http://www.homeloansmidwest.com/
youtube channel:http://www.youtube.com/midwesthomeloans
Mortgage markets worsened last week as investors responded to a recovering global economy.
Despite briefly touching their lowest levels since May, mortgage rates ended the week dramatically higher.
It's the second straight week that rates soared on a Friday.
For several months, Wall Street has been in limbo; undecided whether the economy is truly showing signs of improvement. Negative news has tended to sink rates while positive news has tended to do the opposite.
Lately, investors have been in search of signals anywhere signals can be found. Last week -- sans hard-hitting economic data -- those signals came from the worlds' Central Banks.
Shortly after Australia raised its interest rates by one-quarter percent, Fed Chairman Ben Bernanke suggested that the Fed may raise rates sooner than expected. Stock markets rallied on the news and mortgage bond markets tanked.
When bond prices fall, rates go up.
This week, data returns. Expect more volatility.
Mortgage rates have been very low lately, but they remain jumpy. Rates change fast and if you're not ready for them when they fall, you'll likely miss your chance to catch the bottom.
Rate shoppers in need of a lock should remain in ready-position. As we've seen over the last 2 weeks, when rates start to rise, they tend to rise in a hurry.
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youtube channel: http://www.youtube.com/midwesthomeloans
According to the Freddie Mac weekly mortgage rate survey, the relative cost of a 5-year ARM is dropping versus its 30-year fixed-rate cousin.
During the first 5 months of 2009, the products ran neck-and-neck. Today, they're a half-percent apart.
On a $200,000 home loan, that's a difference of $60 per month.
Adjustable-rate mortgages aren't for everyone, but for the right household, they can be a terrific fit. A few scenarios that warrant consideration of a 5-year ARM include persons:
Additionally, with homeowners with existing ARMs may want to consider taking on a new ARM, if only to extend their initial, fixed rate period.
Before choosing an ARM, make sure to speak with your loan officer about how adjustable-rate mortgages work, and what causes them to adjust. Although conventional ARMs are limited in how far they can adjust, it's important to know the risks.
Dave Kosmecki - Guaranteed Rate, Inc.
website: http://www.homeloansmidwest.com/
youtube channel: http://www.youtube.com/midwesthomeloans
Because of my 27+ years in both real estate and mortgages. We understand that each customer has specific needs, we endeavor to provide our clients with enhanced services and follow-though.
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