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The Mortgage Interest Rate Lock Advisory for Orleans MA for November 30, 2009

Here are some of the events affecting mortgage interest rates today in Orleans, MA.

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 102.44 this morning - down 4/32 from Friday's close.

The chart below shows today's price trend of the FNMA 30-Year 4.5% coupon:

The FNMA 30-Year 4.5% MBS coupon is currently trading at 102.50 - up 2/32 from its opening. Remember, on mortgage backed securities (MBSs), as the price goes up, the yield comes down - and mortgage interest rates come down with it. I expect that mortgage interest rates will be the same in price this morning as compared to Friday's close.

The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days:

Recent Activity in Mortgage Backed Securities:

Economic Reports, News, and Events Affecting Mortgage Interest Rates Today:

• There are no economic reports scheduled for release today.

In other news, The Dubai World default risk swept the global markets over this past weekend. However, it did not have an impact on mortgage interest rates on Monday.

What's Happening With Mortgage Interest Rates Today:

Low to Moderate Volatility. Overall, I suspect it will be a fairly active week for the mortgage market and mortgage interest rates, and we may see sizable movement in mortgage interest rates later this week. The most important day of the week will be Friday with the release of the Employment Situation Report. This report will probably be the key to rates moving lower or higher for the week. If it reveals stronger than expected results, we may see mortgage interest rates spike higher - possibly erasing any gains from the week.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

My Mortgage Interest Rate Lock Advice for Today:

If I were considering financing/refinancing a home, I would...

• Lock if my closing was taking place within the next 7 days
• Lock if my closing was taking place between 8 and 30 days
• Float if my closing was taking place between 31 and 45 days
• Float if my closing was taking place between 46 and 60 days

This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of any or all other borrowers.

Get the best available mortgage interest rates for your situation in Orleans, MA!

The Mortgage Market Watch for the Week of November 30, 2009

Events Affecting the Mortgage Market This Week:

The Dubai World default risk swept the global markets over this past weekend. Pundits and policy makers have had the weekend to make an assessment. The results could lead to lower mortgage interest rates on Monday.

Economic Reports to be Released This Week:

There are 5 economic reports scheduled for release this week that could have an impact on the mortgage market and mortgage interest rates.

Monday, November 30th:

• There are no economic reports scheduled for release today.

Tuesday, December 1st:

• Institute for Supply Management (ISM) Manufacturing Index for November - this index surveys more than 300 manufacturing firms on employment, production, new orders, supplier deliveries, and inventories to gauge their sentiment. Analysts expect to see a decline in sentiment from 55.7 in October to 55.0 in November. A reading above 50 means that more manufacturing executives felt business improved during the month than those who felt it had worsened. A lower than expected reading will indicate a waning sentiment in the manufacturing sector, and makes a broader economic recovery less likely. That will help keep mortgage interest rates down.

Wednesday, December 2nd:

• Beige Book Report - this report, which is named after the color of its cover, details economic conditions by region. Released two weeks ahead of the Federal Open Market Committee (FOMC) meetings, it is heavily relied on by the Feds when determining interest rate policy. The results can affect the mortgage market and mortgage interest rates if it shows any significant surprises.

Thursday, December 3rd:

• Revised 3rd Quarter Productivity Report - this report is expected to show a downward revision from the previous reading in worker productivity, and an upward revision in unit labor costs. Analysts expect to see a decline in worker productivity from the previous estimate of 9.5% to an annualized rate of 8.6%. Higher levels of productivity without increases in labor costs are thought to allow the economy to expand without rising inflationary pressures. That will help keep mortgage interest rates down.
  
  
• Jobless Claims - New claims for unemployment are tabulated each week to show the number of individuals who filed for unemployment insurance for the first time. Analysts are predicting that 485,000 new claims for unemployment will have been filed last week. With a decreasing trend in the filing of new claims for unemployment, this suggests that the labor market is improving. However, this data is usually not considered to be very important to the mortgage market.
  
  
• Fed's MBS Purchase Program - the results of this week's purchases of mortgage backed securities by the Feds will be released in the afternoon. As of last Thursday, the Feds have purchased over $1.038 trillion in mortgage backed securities this year. The Feds plan on purchasing up to $1.25 trillion in mortgage backed securities through March 31st.

Friday, December 4th:

• Employment Situation Report for November - posted by the Labor Department, this is one of the most important monthly reports we see. Analysts expected to see nonfarm payroll decline by 100,000 in November, This will follow a decline 190,000 in October, and a decrease of 219,000 in September. Analysts also expect the unemployment rate to remain at 10.2% and a 0.2% increase in average earnings. An unemployment rate that is higher than 10.2%, a larger decline in jobs and no change in the earnings reading will all help keep mortgage interest rates down.
  
  
• Factory Orders Report for October - this report is similar to the Durable Goods Orders that was released last week. The difference is this one includes orders for both durable and non-durable goods. Analysts are expecting to see a 0.2% increase in new orders. While this report provides us with a measurement of manufacturing sector strength, it usually doesn't have a major impact on the mortgage market.

How do Economic Data Releases Affect Mortgage Interest Rates?

One of the most important things for you to know when deciding when to lock in the interest rate on your mortgage is knowing what economic data is going to be released - and when - and how it may impact the mortgage market and mortgage interest rates.

While an in depth review of an economic event can help you make an informed decision, understanding the nuances of a release can't help you if you don't know when it's happening. Economic data releases are important because they provide a snapshot of what's happening in the economy. They also provide a foreshadowing of any upcoming market volatility. It's just as important to know when these data releases are happening as knowing what effect these releases can have on the mortgage market.

The chart below shows the price trend of the FNMA 30-Year 4.5% coupon over the past 30 days:

Recent Activity in Mortgage Backed Securities:

Remember - as the prices of mortgage backed securities goes up, the yields come down - and mortgage interest rates come down with it. Conversely, as the prices of mortgage backed securities goes down, the yields go up - and so do mortgage interest rates.

Mortgage Interest Rate Outlook:

Moderate to High Volatility. Overall, we may see sizable movement in mortgage interest rates this week. I suspect it will be a fairly active week for the mortgage market and mortgage interest rates. The most important day of the week will be Friday with the release of the Employment Situation Report. This report will probably be the key to rates moving lower or higher for the week. If it reveals stronger than expected results, we may see mortgage interest rates spike higher - possibly erasing any gains from the week.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. Mortgage interest rates are at historic lows. If you're happy with the rate being offered to you and don't want to risk mortgage interest rates moving higher, you should apply and lock in today. While there's still some room for MBS prices to tick higher, it's better to have locked when you should have floated than it is to float when you should have locked.

If you have not yet locked in your mortgage interest rate, please proceed with caution and maintain contact with your mortgage professional. Also, give very serious consideration to applying now and locking in before mortgage interest rates get worse.

Home Value Update for Chatham MA Through October 2009

According to Trulia.com, the sale prices of single family homes in Chatham, MA have fallen 33.9% in the past year through the end of October 2009. Sale prices have depreciated 11.3% over the last 5 years.

The current mean sales price of homes on the market in Chatham, MA, is $550,000. Below is a chart of the trend of listing prices of homes for sale in Chatham, MA, in the past year through October 2009:

Chatham Recently Sold Homes

The $8000 first-time homebuyer tax credit has been extended, and now expires on April 30, 2010. So, there's no better time than now to buy a home in Chatham, MA, or surrounding area. If you're looking for a home or condo to purchase in Chatham, MA, or in the surrounding area, then try this home search.

You can still buy a home with no money down with the USDA Rural Development Home Loan program. With the FHA Mortgage program, you can purchase a home with as little as 3.5% down. When you're ready to buy a home, find out how much home or condo you can afford to purchase in Chatham, MA, or in the surrounding area.

If you're 62 or older and are looking for money to finance a home improvement, pay off your current mortgage, supplement your retirement income, or pay for healthcare expenses, then consider getting a reverse mortgage. Find out how a reverse mortgage can use the equity in your home to pay you.

What Is A Reverse Mortgage? (Part 6)
A 12 Part Series

Part 6 - Outliving the Reverse Mortgage

A reverse mortgage can not be outlived. As long as at least one homeowner lives in the home and keeps property taxes and homeowner's insurance current, the loan does not need to be repaid. In addition, because of the FHA insurance, no one will ever owe more than the home's value. A reverse mortgage can not become "upside down".

Reverse Mortgages and Heir Inheritance

A common concern for homeowners considering a reverse mortgage is making sure that their heirs not be saddled with debt and will inherit the home.

In the event of death of the homeowner or in the event that the home ceases to be the primary residence, the homeowner's estate can choose to convert the reverse mortgage into a traditional mortgage to keep the house. Otherwise, the estate can sell the home, pay the balance due of the reverse mortgage, and keep the remainder of the home's value.

If the equity in the home is worth more than the balance of the loan, the remaining equity belongs to the heirs. No other assets are affected by a reverse mortgage. For example, investments, second homes, cars, and other valuable possessions cannot be taken from the estate to pay off the reverse mortgage.

If the sale of the home is not enough to pay off the reverse mortgage, the lender must take a loss and request reimbursement from the FHA.

The estate has six months to arrange the sale or refinance of the home. An extension to one year can also be requested.

For example:

A $200,000 home is inherited by the estate with a $125,000 reverse mortgage balance.

• The heirs decide not to keep the home - The heirs sell the home for $200,000, pay the lender $125,000, and keep $75,000.
  
  
• When the balance of the reverse mortgage is more than the home is worth - The estate has no obligation. The home can be turned over to the lender who will sell the home to repay as much of the balance as possible. Or, the heirs can refinance the reverse mortgage into a traditional mortgage and keep the home.

Next: Part 7 - Loan Limits and Distribution of Money of Reverse Mortgages

Part 1 - Definition of a Reverse Mortgage
Part 2 - Reverse Mortgage Eligibility Requirements
Part 3 - Myths and Frequently Asked Questions of Reverse Mortgages
Part 4 - Pros and Cons of a Reverse Mortgage
Part 5 - Reverse Mortgages, Income and Taxes

If you're 62 or older and are looking for money to finance a home improvement, pay off your current mortgage, supplement your retirement income, to pay for healthcare expenses, or even to buy your retirement home, then consider getting a reverse mortgage. Find out how a reverse mortgage can use the equity in your home to pay you.

Home Value Update for Brewster MA Through October 2009

According to Trulia.com, the sale prices of single family homes in Brewster, MA have fallen 9.1% in the past year through the end of October 2009. Sale prices have depreciated 7.4% over the last 5 years.

The current mean sales price of homes on the market in Brewster, MA, is $350,000. Below is a chart of the trend of listing prices of homes for sale in Brewster, MA, in the past year through October 2009:

Brewster Recently Sold Homes

The $8000 first-time homebuyer tax credit has been extended, and now expires on April 30, 2010. So, there's no better time than now to buy a home in Brewster, MA, or surrounding area. If you're looking for a home or condo to purchase in Brewster, MA, or in the surrounding area, then try this home search.

You can still buy a home with no money down with the USDA Rural Development Home Loan program. With the FHA Mortgage program, you can purchase a home with as little as 3.5% down. When you're ready to buy a home, find out how much home or condo you can afford to purchase in Brewster, MA, or in the surrounding area.

If you're 62 or older and are looking for money to finance a home improvement, pay off your current mortgage, supplement your retirement income, or pay for healthcare expenses, then consider getting a reverse mortgage. Find out how a reverse mortgage can use the equity in your home to pay you.