October 9, 2008
Friends in Real Estate,
For the 2nd straight day both mortgage backed securities and stocks fell significantly. Usually they move in opposite directions, but due to margin calls and investor redemptions, many investment funds are forced to sell assets to reduce their leverage. So MBS and stocks moved lower and rates have bumped up. Keep in mind the historical average for a 30 yr fixed loan is somewhere between 7 to 9%, so we are still in a low priced environment that is great for buyers!!
Government loans used to be the exception but are quickly becoming common. At this week's Home Builder's Association the director of FHA in NC reminded us that FHA is much more user friendly - closing costs are similar to conforming, no extra inspections on stick built homes (just a copy of the certificate of occupancy), no more long repair checklists, no income restrictions, no reserve requirements and best of all a minimum 3% downpayment (changing to 3.5% January 1, 2009). The greater Charlotte area maximum FHA loan is approximately $303,000.
Here's a sample of today's Primary Home Purchase money rates, up to 0+1, with escrows for a borrower with median credit of 720. These are subject to vary based on loan amount, occupancy, LTV, credit quality and other factors.
Conforming (using 250K as amt)
30 yr fixed 6.00% 15 yr fixed 5.75% 5/1 ARM, 30 yr am 5.875%
Jumbo (using 650K as amt)
30 yr fixed 7.375% 15 yr fixed 6.125% 5/1 ARM, 30yr am 5.875%
Super Jumbo (using 1M amt)
30 yr fixed 7.5% 15 yr fixed 6.125%
Compliments of Ashleigh Sumlin, Bradford Mortgage Company, 704-307-9908 / 704-373-2289