Smart Borrower Blog

Archive for September, 2008

30 Year Rates Slip

Freddie Mac reports that mortgage rates slipped this past week, dropping to 6.35% in the week ending Thursday, down from last week’s 6.40% and the year-ago 6.46%.  Stability in the market right now is not the catch phrase as we would wish it to be.  These numbers are based the national average interest rate on the benchmark 30-year, fixed rate loan.  The 15-year fixed-rate loan averaged 5.90%, down from the week ago 5.93% and the year-ago 6.15%.  Frank Nothaft, vice president and chief economist at Freddie Mac, had this to say – “Mortgage rates eased a bit over the holiday-shortened... more »

Fed Rates Cuts Have Not Made Mortgage Money More Available, Boston Fed Chief Says

Dramatic interest rate cuts by the Federal Reserve over the last year have largely been ineffective in easing the system-wide U.S. credit crunch, according to statements Wednesday from Eric Rosengren, president of the Boston Fed. “Many business borrowers and consumers are finding their access to credit has diminished, and their cost of credit has risen, despite the reductions in the federal funds rate,” Rosengren said in prepared remarks. Led by the collapse of the sub-prime mortgage market last summer, a national credit crunch quickly reduced financing options to investors, small businesses, and home buyers. As hundreds of thousands of sub-prime... more »

Buy And Bail – The Latest Fraud Tactic

Unethical mortgage lenders are not the only ones the market needs to be aware of. Many homeowners, stuck with an upside down mortgage, are attempting to defraud lenders with a strategy Wall Street has aptly named “buy and bail.” The tactic works like this – homeowners, who have a super-mortgage that they want to get out from under, even though they can afford the monthly mortgage payment, wish to dispose of the property because it is a poor investment to them. They realize that the home is worth considerably less than what they owe on it, so they want to... more »