Lewis Corcoran - Offering Reverse Mortgages, and FHA, VA, and USDA Loans

Changes to the FHA Streamline Refinance Program

The requirements for FHA streamline refinances have changed. The new rules went into effect on November 17, 2009.

Under the new FHA streamline refinance guidelines, homeowners who want to refinance their FHA mortgage have to meet tougher eligibility requirements:

• At the time of loan application, the borrower must have made at least 6 payments on the FHA mortgage being refinanced.
  
• For mortgages with less than a 12 months payment history, the borrower must have made all mortgage payments within the month due.
  
• For mortgages with a 12 months payment history or greater, the borrower must have:
  
  • Experienced no more than one 30 day late payment in the preceding 12 months, and
    
  • Made all mortgage payments within the month due for the three months prior to the date of loan application.

There is also a "tangible net benefit" requirement. A "tangible net benefit" is defined as:

• A reduction in the total mortgage payment (principal, interest, taxes and insurances, homeowners' association fees, ground rents, special assessments and all subordinate liens)
  
  • The new total mortgage payment must be at least 5% lower than the total mortgage payment for the mortgage being refinanced.
    
• Refinancing from an adjustable rate mortgage (ARM) to a fixed rate mortgage, or
  
• Reducing the term of the mortgage.

FHA Streamline Refinance applicants must now show evidence of income and employment, plus proof of cash required to close.

If there is more than one mortgage property, there is now a maximum combined loan-to-value (CLTV). If subordinate financing is remaining in place, the maximum CLTV ratio is now 125%.

• For streamline refinance transactions WITHOUT an appraisal, the CLTV is based on the ORIGINAL appraised value of the property.
  
• For streamline refinance transactions WITH an appraisal, the CLTV is based on the NEW appraised value.

In areas of declining home values, this may render refinancing impossible.

Mortgage rates are low right now. If you're a homeowner and you have an FHA mortgage, it may be prudent to explore the possibility of an FHA Streamline Refinance.

Home Value Update for Sandwich MA Through Ocober 2009

According to Trulia.com, the sale prices of single family homes have declined 13.2% in the past year through the end of October 2009. The current mean sales price of homes on the market in Sandwich, MA, is $292,000. Below is a chart of the trend of listing prices of homes for sale in Sandwich, MA, in the past year through October 2009:

Sandwich 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 Sandwich, MA, or surrounding area. If you're looking for a home or condo to purchase in Sandwich, 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 Sandwich, 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.

The Mortgage Interest Rate Lock Advisory for Sandwich MA for November 17, 2009

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

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 101.75 this morning - down 4/32 from yesterday'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 101.94 - up 6/32 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 0.0% - 0.125% better in price this morning as compared to yesterday.

Recent Activity in Mortgage Backed Securities:

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

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

• Producer Price Index (PPI) for October - the overall PPI reading is up 0.3% mostly due to higher energy costs, and follows a 0.6% decline the previous month. However, the core PPI reading declined 0.6% mostly due to declines in the prices of cars and light trucks, and follows a 0.1% decline the previous month. Analysts expected to see a 0.5% increase in the overall reading, and a 0.1% increase in the core data reading.
  
  The PPI measures inflationary pressures at the producer level of the economy. There are two portions of the index that are monitored - the overall reading and the core data reading. The core data is the more important of the two because it excludes more volatile food and energy prices. Even though the report revealed weaker than expected readings, it had almost no impact on the mortgage market or mortgage interest rates this morning.
  
  
• Industrial Production Report for October - industrial production is up 0.1%, less than the 0.4% increase that was expected, and is less than the 0.7% increase the previous month. The capacity utilization rate (factory usage) remained at 70.7%, inline with expectations. This report provides us with a measurement of manufacturing sector strength by tracking output at U.S. factories, mines and utilities. However, this report usually does not have much of an impact on the mortgage market.

What's Happening With Mortgage Interest Rates Today:

Moderate to High Volatility. Overall, the first three days of the week will be the most important with the release of the Retail Sales Report, the Producer Price Index and the Consumer Price Index reports.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. 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
• Float 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 today's mortgage interest rates for your situation in Sandwich, MA.

The Mortgage Interest Rate Lock Advisory for Bourne MA for November 16, 2009

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

What the Mortgage Backed Securities Market is Doing Today:

The price of the FNMA 30-Year 4.5% MBS coupon opened at 101.84 this morning - up 1/32 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 101.84 - the same as 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:

• Retail Sales Report for October - released by the Commerce Department this report measures consumer spending which is considered important as it makes up two-thirds of the economy. The report revealed a 1.4% increase in retails sales in October, up significantly from the 1.5% decline in September. Analysts expected the report to show a 0.9% rise in spending in October. The increase in retail sales is largely attributed to a 7.9% increase in auto sales after a 14.3% decline the previous month. If auto sales are excluded, retail sales improved only 0.2% which follows a 0.4% increase the previous month. Today's retail sales report had no impact on the mortgage market today.

In other news, Ben Bernanke, Chairman of the Federal Reserve, is speaking to the Economic Club of New York today.

What's Happening With Mortgage Interest Rates Today:

Low to Moderate Volatility. Overall, the first three days of the week will be the most important with the release of the Retail Sales Report, the Producer Price Index and the Consumer Price Index reports.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. 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
• Float 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 Bourne, MA!

The Mortgage Market Watch for the Week of November 16, 2009

Events Affecting the Mortgage Market This Week:

Economic Reports to be Released This Week:

There are six economic reports scheduled for release this week. We could see volatility in the financial markets which could affect mortgage interest rates.

Monday, November 16th:

• Retail Sales Report for October - released by the Commerce Department this report measures consumer spending which is considered important as it makes up two-thirds of the economy. Analysts expect the report to show a 0.9% rise in spending in October, a significant increase over the 1.5% decline in September. If the report reveals a larger than expected increase in consumer spending, it would be considered negative news for the mortgage market because large increases in spending fuels an economic recovery and raises inflation concerns in the marketplace, and mortgage interest rates could increase.

Tuesday, November 17th:

• Producer Price Index (PPI) for October - the PPI measures inflationary pressures at the producer level of the economy. There are two portions of the index that are monitored - the overall reading and the core data reading. Analysts are expecting to see a 0.5% increase in the overall reading, and a 0.1% increase in the core data reading. The core data is the more important of the two because it excludes more volatile food and energy prices. If the report reveals stronger than expected readings, this will increase concerns about inflationary pressures, and mortgage interest rates could increase.
  
  
• Industrial Production Report for October - this report provides us with a measurement of manufacturing sector strength by tracking output at U.S. factories, mines and utilities. Analysts are expecting to see a 0.4% increase in production. While stronger than expected increases of production would be considered bad news for the mortgage market, this report usually does not have much of an impact on mortgage interest rates.

Wednesday, November 18th:

• Consumer Price Index (CPI) for October - similar to the Producer Price Index (PPI), this report measures inflationary pressures at the consumer level of the economy. Analysts are expecting to see a 0.2% increase in the overall reading, and a 0.1% increase in the core data reading. If the report reveals stronger than expected readings, this will increase concerns about inflationary pressures, and mortgage interest rates could increase.
  
  
• Housing Starts for October - this report provides an indication of strength in the housing sector, but usually does not have a noticeable impact on mortgage rates. Analysts are expecting the report to reveal 600,000 new housing starts in October. However, this report usually does not have much of an impact on the mortgage market.

Thursday, November 19th:

• Leading Economic Indicators (LEI) - released by the Conference Board, this report attempts to predict economic activity over the next three to six months. Analysts are expecting to see a 0.4% increase in the index. This means that analysts are forecasting an increase in economic activity over the next few months. However, this report usually does not have much of an impact on the mortgage market.
  
  
• 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 504,000 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 $1.006 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, November 20th:

• There are no economic reports scheduled for release today.

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:

Low to Moderate Volatility. Overall, the first three days of the week will be the most important with the release of the Retail Sales Report, the Producer Price Index and the Consumer Price Index reports.

There's not much room for MBS prices to move higher or for mortgage interest rates to move lower at the moment. 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.