Daily Mortgage Market Guide for 01/16/09
More deflationary news has started to trickle out this morning. Citi and BofA didn't do so well in Q4. In addition, the BLS report came out showing continued economic slowing.
Remember, the biggest enemy to mortgage rates is inflation which continues to subside with the above news.
One of our current concerns is whether or not investors continue to develop an appetite for mortgage market securities. We should be seeing mid 4's rates consistently by now for 30 year mortgages but have not due to the lack of MBS buying (the reason the Fed is buying them).
MBS's were weaker yesterday at close of market and they opened up a little weaker this morning which means rates won't get better just yet. With the economic reports discussed above I expect this trend to change mid day and we'll hopefully start seeing rates improve.
The average rate for the top 15 national banks: Owner occupied homes, 30 year fixed mortgage, RATE LOCKED FOR 30 DAYS, platinum borrower*, zero origination, zero discount points is- 5.375%***
Lender only closing cost averages (fully disclosed / title and settlement not included)- appraisal, credit, underwriting, processing, tax service, flood certification, document drawing, etc.- $1500***
***The lower the rate the higher the fees. The higher the rate the lower the fees. Like a teeter totter.
IMPORTANT FANNIE MAE PRICING CHANGES: You might also want to go to Fannie Fees to see the new loan charges that Fannie Mae has begun to implement. These are additional points mortgage borrowers will pay for conventional loans if they fall into one of the new catagories: credit score, loan to value, type of property, etc...
The Fannie chart will help you avoid getting bait and switched with "low balling" rate quotes from unethical lender agents.
*Platinum borrower: 25% property equity, 720 credit min score, sound job and savings.
