Connecticut Mortgage Rates and Financing Update July 29, 2011

The theme of volatility is ongoing. Loan pricing has moved in the opposite direction from the previous day for 6 sessions in a row now.  The increases seen yesterday in home loan borrowing costs were erased the next day,  leaving things slightly worse than average versus the last two weeks, but about middle of the road when comparing to the last month.

The only bet that has a decent probability of success in this environment is that no bets are clearly better than any others. This should continue to be the case until at least some semblance of resolution makes it's way to the debt-ceiling debate. This makes for plenty of volatility in the meantime.

Rather than change rate sheets with each rapid movement in the secondary market, it's not only easier on all parties involved, but downright necessary for lenders to be extra conservative with rate sheet offerings.

The Federal Reserve plans to provide guidance to banks soon on how to handle the potentially turbulent financial waters if the United States exhausts its borrowing authority on August 1. "We have been engaged in operational planning with the Treasury," Fed spokeswoman Barbara Hagenbaugh said on Thursday. "We expect to be able to give additional guidance to financial institutions when there is greater clarity from the Congress and when Treasury outlines its specific operational plans."

PLEASE NOTE: THIS IS AN AMENDED VERSION OF THE RATES PROVIDED  EARLIER THIS MORNING. RATES CHANGED THREE TIMES TODAY... AND THEY ARE LOWER!!

30 year fixed - 4.375% + .0 points for rate
20 year fixed - 4.00% + 0 points for rate
15 year fixed - 3.50% + 0 points for rate
10 year fixed - 3.250%  + .705% lender credit points for rate
5/1 ARM - 2.625% - 0 points for rate
7/1 ARM - 3.125%  + 0 points for rate

FHA/VA
30 year fixed - 4.250% + .500 points lender credit for rate
5/1 ARM - 2.875 +  0 points for rate
7/1 ARM - 3.250 + 0 point for rate

Jumbo - over 729,000
30 year fixed - 4.99 % with 0  points  for rate
15 year fixed - 4.50% + 0   points for rate
5/1 ARM - 3.375 % + 0 points for rate
7/1 ARM - 4.00% + 0 points for rate

10/1 ARM -  4.50% with + 0 points for rate

Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

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Connecticut Mortgage Rates and Financing Update July 22, 2011

This week was filled with housing-related news. The modest pop in housing starts - new construction (led by multi family), was positive though most analysts believe that there is little reason to believe that the U.S. will see a real pickup in home construction any time soon. The most recent data from the Census Bureau shows 13.4 million vacant homes, roughly 3 million above a normal market. Much of this is from the big increase in vacancies that we saw in 2005-2006 when overbuilding hit its peak. The fastest-growing category of vacancies is in homes that the owner would like to sell or rent but are currently "held off" the market, and it is yet another form of shadow inventory that will eventually have to be absorbed.

We also had the FHA Home Price Index increase by .4% in May, the second consecutive monthly increase and better than the expected 0.1% increase. April's results were revised downward to a 0.2% increase from an initial estimate of a 0.8% increase.   Year over year, home prices were still down 6.3%, and the index remains 19.6% below its peak in April 2007 and roughly equal to the level of January 2004.

Rates crept up during the latter half of the week, mostly due to speculation that Greek bonds will receive some type of European guarantee. Just as investors move money during a "flight to safety," they move it out again when risk is reduced - and that is what we saw Thursday. The EU side of the debt drama appeared to be making some progress as opposed to the US debt ceiling impasse. The 10-yr closed at 3.01%,and traders reported higher selling of mortgage-backed securities on the sell-off. There are no economic releases scheduled for today, Friday July 22.  The markets will stay focused on the deals being reached in Europe and in the US with an eye on what our stock market is doing.

An apparent consequence of Dodd Frank, MetLife Bank is for sale - but not the mortgage company. In a quote that tells it all, "MetLife Bank represented just two percent of MetLife Inc.'s first quarter 2011 operating earnings, and we do not believe it is appropriate for the overwhelming majority of our business to be governed by regulations written for banking institutions," said Steven Kandarian, president and chief executive officer of MetLife Inc. MetLife Inc. said that it is considering the sale of its Met Life Bank N.A.'s depository business and eliminating the company's status as a bank holding company. The firm said it will still offer residential mortgages through its MetLife Home Loans business.


30 year fixed - 4.50% + 0 cost points for rate
20 year fixed - 4.250% + 0 points for rate
15 year fixed - 3.625% + .50 points for rate
10 year fixed - 3.250%  0 cost points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.250%  + 0 points for rate

FHA/VA
30 year fixed - 4.375% with 0 points for rate
5/1 ARM - 3.00 with 0 points for rate
7/1 ARM - 3.50 with 0 point for rate

Jumbo - over 729,000
30 year fixed - 4.99 % with +.50  points  for rate
15 year fixed - 4.625% + .250 cost points for rate
5/1 ARM - 3.50% - 0 points for rate
7/1 ARM - 4.00% - 0 points for rate

Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

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Financing Update and Today's Mortgage Rates in Connecticut- July 15, 2011

If you are considering purchasing a home before September 30, 2011 - and you have not made an offer or locked in your loan - the window of  time is getting more and more narrow and the time to act is now.

As part of the 2008 Stimulus package, Freddie and Fannie - the government-run agencies who purchase almost all mortgage debt,  have enacted and used a temporary expanded conforming loan limit for one year duration, subject to renewal.  The program allowed a lower cost of borrowing for designated high cost areas.  In  Fairfield County, CT the expanded amount is 709,000.  The conforming loan limit has been 417,000 and less,  and the jumbo conforming loan limit (or expanded conforming limit) has been a maximum of 729,500 for high cost areas.  The number used for the loan limit is determined by a government agency and is based on a formula using the actual prices of homes sold in geographic areas. The difference in rates between the two loan limits is often less than .250% in the rate - if a 417,000 30 year fixed is 4.50% - a 729,500 30 year fixed would be 4.750%.   Before the stimulus package,  any loan over 417,000 was considered a jumbo loan and often the rate price increase was more than 1% above the conforming loan limits for fixed rate.  

 Every year there is buzz and speculation about the loan limit amount being extended for another year.   The temporary loan limits for the jumbo conforming (or expanded conforming) expire October 1, 2011 - which means if your loan over 417,000 and more than the new lower expanded loan limits and is not closed and funded by Friday - September 30, 2011, your  loan will have a price increase.  For the first time since 2009, banks and lenders are gearing up to change their rate sheets to price and reflect non expanded limits -  and are informing their loan officers to expect the loan limit to return to 417,000 for conforming and in Fairfield County CT - the new perennate limit for expanded limits is reduced from 709,000 to a maximum of 635,000.

It now takes some lenders as long as 45 - 60 days to close a purchase loan. Most real estate contracts ask for at least 60 to 90 days for occupancy. Knowing the time frame from accepted offer to the close of a loan -  it is 76 days from July 15 to September 30,2011.  

The breaking news is - on Friday July 15, 2011 Representative Campbell (R) and Ackerman (D) have introduced a bill to extend the higher 2008 government loan limits for two more years.

It is imperative that consumers are aware of the risk, and more importantly for all lenders to be aware of the new expiration date and closely watch this new legislation. 

Here are today's rates:

30 year fixed - 4.375% + .375 cost points for rate
20 year fixed - 4.1250% + .250 points for rate
15 year fixed - 3.625% 0 points for rate
10 year fixed - 3.250%  with .250% credit for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.125% - 0 -points for rate

FHA/VA
30 year fixed - 4.375% with 0 points for rate
5/1 ARM - 3.00 with 0 points for rate
7/1 ARM - 3.375 with 0 point for rate

Jumbo - over 729,000
30 year fixed - 4.99% with 0  points  for rate
15 year fixed - 4.50% + .250 cost points for rate
5/1 ARM - 3.50% - 0 points for rate
7/1 ARM - 4.00% - 0 points for rate

Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

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Financing Update and Today's Mortgage Rates in Connecticut- July 1, 2011

Rate sheet "influential" mortgages are experiencing modest price losses after Greek lawmakers agreed to implement aggressive austerity measures Thursday morning. Based on the market's reaction to this news, this was a widely expected outcome. This stabilization is somewhat comforting but not enough to stop a corrective rally before the long weekend. This paints a less positive picture for bonds over the next few days. After failing on multiple occasions to extend the two-month bond rally, traders are feeling technically exhausted. The path of least resistance is up for interest rates, at least in the short-term. That puts pricing in a defensive posture for the next 10 to 20 days. The market predictors are not ready to change the outlook for lower rates by the end of the summer. Remember, this happened last year, which supports the long standing view that "history is repeating itself" in the bond market.  In times like these, the value of analyzing Mortgage  Backed Securities charts greatly decreases and underlying benchmarks become much more important. Thursday morning the bond market came into the day as close to "on the edge" of the recent range as it could be. Long story short, the breakout has now been confirmed after looking indecisive leading up to 9:45 AM Chicago PMI data. After that, the snowball began. Volume ramped up, and yields moved sharply. The market reached its next major technical level for 10 year yields, and in terms of "history repeating itself" is an analogous level to how things happened in 2008. If history continues repeating, more volatility is in store--BIG swings.

30 year fixed - 4.625% - .250% points for rate
20 year fixed - 4.375% - 0 points for rate
15 year fixed - 3.750% 0 points for rate
10 year fixed - 3.375% 0 points for rate
5/1 ARM - 3.00% - 0 points for rate
7/1 ARM - 3.50% - 0 -points for rate
10/1 ARM - 4.125 % 0 points for rate
Jumbo - over 729,000
30 year fixed - 4.99% +.50 points  for rate
30 year fixed - 5.125% - 0 points for rate
15 year fixed - 4.625 % - 0 points for rate
5/1 ARM - 3.750% - 0 points for rate
7/1 ARM - 4.250% - 0 points for rate
10/1 ARM - 4.625% 0 points for rate

Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

Financing Update and Today's Mortgage Rates in Connecticut- June 24, 2011

Independent mortgage banks and subsidiaries saw a huge dip in profitability as the average they made on each loan originated dropped from $1,082 in the fourth quarter to $346 in the first quarter. According to the MBA’s Mortgage Bankers Performance Report, lenders increased their overall revenues but profits suffered because of higher production costs. The "Best Execution" conventional 30-year fixed mortgage rate is 4.50%. Some lenders may be quoting 4.375%, but that offer is aggressive and will likely carry increased closing costs in the form of origination fees.  These costs could be worth it to applicants who plan to keep their new mortgage outstanding for long enough to break even on the extra upfront costs.  On FHA/VA 30 year fixed"Best Execution"  is 4.25%.  15 year fixed conventional loans are best priced at 3.75%. Five year ARMs are best priced at 3.125% but the ARM market is more stratified and there is more variation in what will be"Best-Execution" depending on your individual scenario.   

30 year fixed - 4.50% - 0 points for rate
20 year fixed - 4.250% - 0 points for rate
15 year fixed - 3.625% 0 points for rate
10 year fixed - 3.250%
5/1 ARM - 2.75% - 0 points for rate
7/1 ARM - 3.250% - 0 -points for rate
Jumbo - over 729,000
30 year fixed - 4.99% 0 points  for rate
15 year fixed - 4.50% - 0 points for rate
5/1 ARM - 3.50% - 0 points for rate
7/1 ARM - 4.00% - 0 points for rate

Contributed by Jennifer Buchanan of MetLife Loans

About Jennifer Buchanan:

    Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

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