Jackson, TN

What's Ahead For Mortgage Rates This Week : October 19, 2009

Mortgage markets worsened last week on better than expected economic data, causing mortgage rates to rise.

Last week was the third consecutive week that mortgage rates moved higher and, since touching a multi-month low in early-October, conforming mortgage rates are up by about a half-percent.

It's likely rates will continue to rise, too. That's because the same force that held rates down for so long is now the force pulling them up -- expectations for the U.S. economy.

Over the last 6 months, it wasn't clear in what direction the country was headed. The housing sector has been gaining in strength, but the rest of the economy has been a question mark.

Last week put an end to some of those questions:

• Retail Sales posted stronger-than-expected results
• Consumer Sentiment matched September 2008 levels
• Jobless and continuing claims fell below consensus estimates

Expectations for the U.S. economy are changing on the fly. As a result, stock markets gained last week and mortgage markets lost.

This week, rates could move higher still. There are an unusually large number of key economic reports including on housing and inflation, plus a handful of speeches from key Federal Reserve members.

With each positive announcement, mortgage rates should rise.

There seems to be alot of confusion about the FHA $8000 tax credit. Per Mortgage Letter 2009-15, the second lien may not exceed the total amount needed for the DOWN PAYMENT, CLOSING COSTS, AND PREPAID EXPENSES.

However, the downpayment required MAY NOT consist of any funds provided by the mortgagee, the seller,or any other person or entity that FINANCIALLY BENEFITS FROM THE TRANSACTION.

That seems to be where the confusion is coming from. The purpose of the tax credit is to provide the borrower an asset to meet the downpayment/closing cost requirements, but it is in the form of a second mortgage. Some of the entities providing the purchase of the second do have their own debt to income guidelines as well as first time homebuyer education requirements, so be sure to be on the lookout for those bypes requirements.

Sharon Nicholson, Mortgage Consultant, Assured Funding Corp., Jackson TN

What a country we live in, another tranfer of power with no problems were else can you say that. Not only no problems but a change in races for the first time as president and smooth as silk. How lucky we are to be born in the United States of America the goverment doesn't tell us what to do, what religion to worship and what we say or can't say and can go and come as you want. How lucky we are.

Hi my name is Mike Manns and I just got started in active rain and this is my first blog. I'm an home inspector from Jackson Tn. and just go introduced to active rain by Mike Frazier Broker/Owner of Carousel Realty of Dyersburg Tn. I was talking to a realtor the other day and he said it was buy one and get one free, that got me to thinking what a wonderful time to be buying a home.

Several realtors from a cross of companies have joined together for a "Horse Farm Tour of Homes". This should be an exciting and fun Saturday. Below is a list of the farms to be toured. The tours start at 10:00AM and end up around 5:00PM. Since all are in different quaint little communities it should be a great adventure and you'll probably see some great barns, horses, fencing, and just overall some beautiful countryside. So.....if you're in the area, please join the ride. For a complete schedule of times and locations, please log onto www.theaussierealtor.com.

Linda Lipscomb, RE/MAX Unlimited in Lexington, TN. www.lindalipscomb.com