government assistance mortgage

Mortgage Rates Are Going Up — But Not For The Reason You’d Expect

December 13, 2007

Conforming mortgages are getting more expensive — but not because of mortgage rates. To protect against further weakness in the housing sector, Fannie Mae and Freddie Mac are instituting “delivery fees” on all conforming mortgages, effective March 2008. Fannie Mae’s Adverse Market Delivery Charge and Freddie Mac’s Market Condition Delivery Fee will add a one-time, quarter-percent […]

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Making English Out Of Fed-Speak (December 2007 Edition)

December 12, 2007

The Fed lowered the Fed Funds Rate by 0.250%.  The rate decrease was not well-received, though, as many investors were calling for a deeper cut of a half-percent. In response, dollars moved from stock markets to bond markets and, therefore, mortgage rates fell. Because it is tied to the Fed Funds Rate, Prime Rate fell by […]

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Why Credit Card Holders May Benefit From The Fed’s Actions Today

December 11, 2007

The Federal Open Market Committee meets today and will release a public statement at 2:15 P.M. ET. It is widely expected that the FOMC will lower the Fed Funds Rate by at least 0.250%. When the FOMC lowers the Fed Funds Rate, it is trying to “loosen” credit for American businesses and consumers.  When credit […]

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The Week In Review (December 10, 2007) : What To Watch For

December 10, 2007

Among lingering doubts about housing and credit markets, and a general uncertainty about the U.S. economy, the mortgage bond market tanked towards the latter part of last week. As investors moved away from mortgage bonds, mortgage rates forcefully bounced off their two-year lows. A major factor behind last week’s run-up in rates is the market […]

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Mortgage Rate Relief Plan: Who Qualifies For Help?

December 7, 2007

Thursday, the White House revealed its HOPE NOW program, aiming to help sub-prime borrowers freeze their initial “teaser” rates for a period of five years. The program is receiving a lot of ink in the newspaper dailies but sometimes it’s unclear exactly what the program offers, and to whom. Let’s look at the details and […]

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Your Credit Score Doesn’t Cost You Today, But In Three Months It Could Cost You Plenty

December 6, 2007

Credit scores are the best predictor of how a homeowner will pay on a mortgage, so it’s no surprise that credit scores will play a bigger role in mortgage financing in 2008. Actually “that date” is more clearly defined.  It’s March 1, 2008. For loans closing on or after March 1, 2008, Fannie Mae and Freddie […]

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What Does It Mean To “Escrow” Taxes And Insurance?

December 5, 2007

As a homeowner, your financial obligations extend beyond your monthly mortgage payment.  Periodically, you are also required to pay real estate taxes and homeowner’s insurance premiums. Each month, you pay your mortgage payment to a company called a “mortgage servicer” (because they “service” your mortgage each month). In addition to the risk of not getting […]

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Why New Home Sales Data Doesn’t Tell Us Much About The Real Estate Market

December 4, 2007

October’s New Homes Sales report showed a modest month-over-month improvement from September. Before we interpret that to mean that the housing market is rebounding, though, let’s consider the fallibility of the New Home Sales report. On the Census Bureau’s Web site, there is a disclaimer about the validity of the data.  Paraphrased, it reads: A […]

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The Week In Review (December 3, 2007) : What To Watch For

December 3, 2007

If you enjoy roller coaster rides, last week’s mortgage markets were a delight.  Up and down mortgage rates went, trying to find a balance between inflation and recession (or maybe neither). A major cue for markets last week came from a high-ranking Fed official who raised expectations for future cuts to the Fed Funds Rate.  […]

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What If The Energy Company Paid YOU Each Month?

November 30, 2007

This 30-second video posted to YouTube and shows a home’s electric meter running backwards after installing solar panels. The meter runs backwards because the home is putting more power into the electric grid than it is taking out for itself. With energy costs expected to rise sharply this winter and the costs of “going green” coming […]

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Buyers, You Will Pay More For A Home Than The Agreed-Upon Purchase Price

November 29, 2007

In real estate, the true cost of buying a home is always higher than the home’s purchase price itself. This is because of service charges from governments, lenders, and title/escrow companies. Because there is no such thing as “typical” closing costs because each home purchase is different, home buyers should remember that the actual cost […]

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Why You Should Remain In “Ready Position” For Your Mortgage Rate

November 28, 2007

Easy come, easy go. There was a strong rally Monday afternoon in the mortgage bond market.  It was sudden and furious, mostly coming on in the last 60 minutes of trading. When markets closed, mortgage rates for conforming home loans were grazing their lowest levels in nearly two years. It lasted overnight and into the […]

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It’s A Good Time To Buy — But Not For The Reasons You May Think

November 27, 2007

Since November 1, the following banks have written-down at least $1 billion in their respective loan portfolios: Bank of America Barclays Bear Stearns Citigroup HSBC Morgan Stanley Wachovia Wells Fargo This is a big deal to people in the market for a home loan because when banks repeatedly take mortgage-related losses, it can lead to […]

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The Week In Review (November 26, 2007) : What To Watch For

November 26, 2007

In a holiday-shortened trading week, mortgage rates finished the week slightly improved. But, because many traders had left early for Thanksgiving, matching buyers and sellers at any given price proved to be an exercise.  Mortgage rates bounced wildly as a result. Between now and the New Year, expect the same volatility.  Fewer market players means […]

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Black Friday Trivia

November 23, 2007

Today is “Black Friday”, a day that many Americans get started on their Holiday Season shopping. Did you know? The earliest known reference to “Black Friday” is November 29, 1975.  The term was mentioned in two separate articles, both with Philadelphia timelines.  Therefore, the term Black Friday is believed to have originated in Philadelphia. Did […]

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Who Are Fannie And Freddie And How Do They Help Homeowners?

November 21, 2007

Fannie Mae and Freddie Mae are quasi-government agencies in that they are publicly-owned, but overseen by the government. The purpose of Fannie and Freddie is to make sure that money is available to homeowners that want home loans. Neither lends to consumers directly, though; you’ll have to talk to your loan officer for that.  Instead, […]

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On Random Rate Rallies And Thin Trading

November 20, 2007

Mortgage bonds staged a late-day rally yesterday, exaggerated by the holiday-shortened week and because trader participation is light. (We’ll revisit this theme several times between now and the New Year so don’t get tired of it.) When mortgage bonds rally, it means that demand for them is strong and that pushes mortgage rates down. Unfortunately for […]

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The Week In Review (November 19, 2007) : What To Watch For

November 19, 2007

In a holiday-shortened week with no major economic data releases, expect worries about the credit markets and speculation about holiday shopping to take center stage. Last week was a mixed bag for the economy and mortgage markets responded in kind.  Rates were relatively unchanged. The news started with Wednesday’s Retail Sales report.  In showing a […]

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The Cost Of Living Includes The Cost Of Gas And Food (And May Get More Expensive Through The Winter)

November 16, 2007

October’s Consumer Price Index was released Thursday and showed a 3.5 percent increase in the cost of living since October 2006. The report also showed a core inflation rate of 2.2 percent. The “core CPI” is a smaller part of the overall CPI. The math is the same, but it specifically excludes cost changes in […]

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Homeowners Should Have Basic Wills

November 15, 2007

Statistic #1: According to the Census Bureau, 69% of Americans are homeowners. Statistic #2: According to lawyers.com, 42% of Americans have a basic will. Basic Math: 27% of American homeowners are in need of a basic will. Addressing mortality can be difficult for some people, but even more difficult is addressing a home that’s been […]

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