Articles Published in: January 2017

January 24, 2017

Mortgage Rate Trends: Sharply Improved

You may have noticed some extra coverage of mortgage rate trends in the last few weeks; rates have moved up and down in ways that seem to insist on added coverage, and Monday’s mortgage rate activity was definitely that. Rates recovered ground lost in the previous week and part of the reasons for that are also the reasons we saw higher rates in our last report; there is still a great deal of uncertainty among the markets and investors when it comes to economic policy, how the new administration will deal with overseas trade and other important issues. Mortgage rate trends currently reflect this uncertainty. Investors reacted to the earliest activity from the new regime in Washington D.C. and those reactions helped push mortgage rates lower. We’re now seeing a | more...

January 23, 2017

FHA Announces Suspension Of Earlier Policy Changes

By Joe Wallace

Earlier in January 2017, we reported on changes in policy regarding FHA Mortgage Insurance Premiums. Mortgagee Letter 2017-01 announced revised, lower Mortgage Insurance Premiums, plus the elimination of the distinction in rates based on the base loan amount according to the mortgagee letter. However, a new mortgagee letter announces that this change has been suspended. “This Mortgagee Letter…communicates that Mortgagee Letter 2017-01, reducing Mortgage Insurance Premiums for loans with Closing/Disbursement date on or after January 27, 2017, has been suspended indefinitely. FHA will issue a subsequent Mortgagee Letter at a later date should this policy change.” It is unclear at the time of this writing whether the suspended policy will be revised, or eliminated completely, but we will report on any future developments. Borrowers with FHA loans that have closing/disbursement | more...

January 23, 2017

Mortgage Loan Interest Rate Trends: Higher

By Joe Wallace

Mortgage loan interest rate trends have been up and down within a certain range in the new year, but uncertainty over the new administration in Washington D.C. has investors skittish. Since our last report we’ve seen mortgage loan rates push higher, with some lenders hitting 4.375% territory (best execution). For 30-year fixed rate conventional mortgages, our sources say that means that at the time of this writing, there’s a best execution range that starts at or near 4.125% (a smaller number of lenders offering this) and ending with Friday’s at-or-near 4.375% for other lenders. FHA mortgage rates are at the time of this writing still holding at a best execution 3.75%, but that’s likely to change soon if the upward trend remains. As always, the rates you see listed here | more...

How much can I borrow with an FHA refinance loan?

January 20, 2017

FHA Updates PACE Policy

By Joe Wallace

A new mortgagee letter updates FHA loan policy on properties bought with FHA loans that are “encumbered with a Property Assessed Clean Energy obligation”. Mortgagee Letter 2017-06 updates PACE policy starting with a reminder; “The terms and conditions of a PACE obligation may vary by state, local government, and PACE program. Generally, a PACE obligation is secured and collected in the same manner as a special assessment is treated by the local government; funds obligated are not paid directly by the Borrower to the party providing the PACE financing.” When the sale happens (including foreclosure sales), if a property has “outstanding PACE financing” the obligation will, according to the mortgagee letter, “continue with the property causing the new homeowner to be responsible for the payments on the outstanding PACE amount. | more...

January 19, 2017

Mortgage Rate Trends: Moving Higher

By Joe Wallace

While we don’t report on mortgage rate trends on a daily basis, we do give more time to that coverage when circumstances warrant, and this week definitely rates a closer look at the trends. Since our last report, mortgage rates moved decisively higher, pushing back in the direction of the mid-four percent zone (but not there yet). Some market watchers blame (at least in part) bond market performance for the most recent upward spike that pushed 30-year fixed rate conventional mortgages into a range between a best execution 4.125% and a best execution 4.25%. Prior to that, coming out of the weekend we saw more lenders at the lower end of that range. Could some borrowers see them most recent changes reflected in closing costs rather than actual mortgage rate | more...

January 18, 2017

Fair Housing Issues: Discrimination Against Children

By Joe Wallace

There are many reasons why we report on Fair Housing Act laws. Violations of Fair Housing laws don’t just directly affect the borrower who is trying to purchase a home; such violations can hurt renters who are in the planning stages of a home loan or those who are actively looking as renters who have relocated to a new job market, etc. Families with children looking to rent or buy with an FHA loan (or any other type of mortgage) may experience discrimination based on family status. One recent example discussed on the HUD home page makes it clear that people from all walks of life may experience this type of illegal discrimination. Consider a recent example in Wichita, Kansas, where credit history, payment status, or other financial qualifications were | more...

January 18, 2017

Mortgage Rate Trends: Going Lower Again

By Joe Wallace

Since our last report, the mortgage rate trend has swung back to improvements, taking back loses incurred last week and dropping hints that things could be settling into a new range. It’s still early days yet, but industry professionals are talking about these gains in association with weaker stock market performance, talk of European economic issues, and bond market activity. If the current trend persists, we might see rates (best execution) at or near current levels, giving those inclined to float a better picture of where things could go if upward pressure resumes. If you haven’t made a mortgage rate lock commitment with your loan officer, at present it might be easier to set your cut-off; if you decide to “float” until rates improve or cut your losses and lock | more...

January 17, 2017

Mortgage Rate Trends: Edging Higher

By Joe Wallace

Markets were closed on Monday for the Martin Luther King, Jr. holiday, so today’s post should be read with that in mind. Since our last report, mortgage rate trends have taken a turn upward. That move has given back some of the gains mentioned in our last report, but at the time of this writing we’re still looking at changes small enough to be reflected mostly in closing costs for affected borrowers, but some lenders have repriced as we’ll see below. The upward move comes in spite of some retail sales economic data that has (in the past) helped mortgage rates rather than hurt them, but the existence of data of that nature doesn’t guarantee movement in mortgage rates; it all depends on investor reaction to the data. And we | more...

January 16, 2017

Mortgage Rate Trends: Edging Higher

By Joe Wallace

Since our last report, mortgage rate trends have taken a turn upward. That move has given back some of the gains mentioned in our last report, but at the time of this writing we’re still looking at changes small enough to be reflected mostly in closing costs for affected borrowers, but some lenders have repriced as we’ll see below. The upward move comes in spite of some retail sales economic data that has (in the past) helped mortgage rates rather than hurt them, but the existence of data of that nature doesn’t guarantee movement in mortgage rates; it all depends on investor reaction to the data. And we know that investor reactions aren’t always predictable and don’t always follow historical precedent. 30-year fixed rate conventional mortgage loan interest rates are | more...

January 13, 2017

HUD Charges Bank of America With Housing Discrimination

By Joe Wallace

The HUD official site has announced that the agency is bringing charges of Fair Housing Act violations against Bank Of America in South Carolina. According to a press release, “The U.S. Department of Housing and Urban Development (HUD) announced today that it has charged Bank of America, N.A., and two of its employees with violating the Fair Housing Act by discriminating against prospective Hispanic mortgage borrowers in Charleston, South Carolina.” Federal Fair Housing laws make it illegal to discriminate against borrowers based on race, color, national origin, religion, sex, familial status, or disability. According to HUD press release HUDNo.17-004, “The National Fair Housing Alliance (NFHA) filed a complaint with HUD claiming the bank discriminated against prospective borrowers who are Hispanic by failing to provide them with information about loan products | more...