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Archive for the ‘Mortgage Rates’ Category

Mortgage Applications Fall Even As Rates Hit Record Lows

The demand for home loans decreased in the latest week, according to data from the Mortgage Bankers Association Wednesday, as borrowers wait for interest rates to fall even farther in coming weeks. The MBA’s seasonally adjusted weekly mortgage application index fell 8.2 percent to 1,143.8 during the week ended January 2, 2008, the first drop in four weeks. The number of home purchase requests actually increased with the purchase index rising 7.3 percent from the previous week but homeowners held back from refinancing causing the refinance index to sink 12.3 percent. Most analysts, including those from the MBA, attribute the... more »

Fed Moves Forward with MBS Purchases

On Tuesday, the Federal Reserve named four investment companies it has appointed to start buying up billions of dollars worth of mortgage-backed securities (MBS) during the coming months, in an effort to stabilize the national economy and mortgage market. The enlisted companies are BlackRock Inc, Goldman Sachs Asset Management, PIMCO, and Wellington Management Co. These parties will assist the Fed in purchasing between $80 and $100 billion of mortgage-backed securities every month in order to meet the goal of $500 billion of MBS by the middle of 2009. The Fed had announced plans in November to buy up MBS starting... more »

Existing Home Sales and Prices Decline in November

As the economy continued to weaken, sales of existing U.S. homes fell in the latest month, as did the median home price, according to data released by the National Association of Realtors.  Existing home sales, which include single-family, town homes, condominiums, and co-ops, dropped to a seasonally adjusted rate of 4.49 million units in November, down 8.6 percent   from the previous month. The latest sales figures represent a 10.6 percent decrease from the November 2007 pace.  Lawrence Yun, NAR chief economist, blamed the decline on the broader economic turmoil. "The quickly deteriorating conditions in the job market, stock... more »

Federal Reserve Makes Historic Rate Cut Decision

The Federal Reserve made an unprecedented move Tuesday by resetting its target interest rate to a range of zero to 0.25 percent, down from 1.0 percent, citing continued weakness in the U.S. markets as the impetus for the dramatic decision. "Since the Committee’s last meeting, labor market conditions have deteriorated, and the available data indicate that consumer spending, business investment, and industrial production have declined," said the Federal Open Market Committee in a statement. "Financial markets remain quite strained and credit conditions tight.   Overall, the outlook for economic activity has weakened further." The Fed has consistently lowered its rate... more »

NAR Predicts Lower Mortgage Rates as Pending Home Sales Stabilize

The National Association of Realtors is forecasting lower mortgage interest rates into 2009 even though   its index of pending home sales has been relatively stable. According to a release Tuesday, the NAR Pending Home Sales Index slid down just 0.7 percent in October from the previous month and down 1.0 percent from October 2007. The index is based on signed sales contracts and is an indicator of future sales. "Despite the turmoil in the economy, the overall level of pending home sales has been remarkably stable over the past year, holding in a generally narrow range," said Lawrence Yun,... more »

Mortgage Demand Up 112.1 Percent As Interest Rates Fall

The  volume of U.S. mortgage applications shot up dramatically in the latest week as borrowers sought to take advantage of low interest rates, according to the Mortgage Bankers Association Wednesday. “Many borrowers missed an opportunity to take advantage when rates dropped sharply for a brief period when the GSEs were placed under conservatorship,” said Orawin Velz, associate vice president of economic forecasting for the MBA. GSE stand for government-sponsored enterprises, meaning mortgage companies like Freddie Mac and Fannie Mae. "When rates plummeted following the Fed’s announcement that it would buy GSE debt and MBS [mortgage-backed securities], many of those on... more »

Mortgage Interest Rates Fall on New Rescue Plan

Interest rates on long-term U.S. home loans fell in the latest week, a reaction to the newly announced Bush administration's $800 billion bailout package to provide more liquidity for consumer and mortgage debt markets, according to data from Freddie Mac. “Interest rates for 30-year fixed-rate mortgages fell for the fourth consecutive week as signs the overall economy is flagging lowered most interest rates market-wide,” said Frank Nothaft, Freddie Mac vice president and chief economist. “And economic growth in the third quarter was revised downward this week, led by the first decline in consumer spending since the fourth quarter of 1991... more »

Hope for Homeowners Program Not Yet Providing Much Hope

A new government program designed to help homeowners avoid foreclosure is not attracting many takers at this point, according to the Federal Housing Administration and lenders around the country. The program, Hope for Homeowners, is a Bush administration-led effort to help struggling mortgage borrowers refinance   into FHA-backed loans with lower balances and possibly even lower interest rates. The end result for homeowners would be smaller payments and a partial recuperation of equity. When the program began officially on Oct. 1, the FHA estimated that it could help as many as 400,000 borrowers stay out of foreclosure through 2011, yet... more »

Fed Slashes Rate to 1.0 Percent

By a unanimous vote, the Federal Open Market Committee, a branch of the Federal Reserve, decided to cut its target rate by 50 basis points Wednesday to 1.0 percent. The last time the federal funds rate, the interest rate which banks charge each other for overnight transfers, was at 1.0 percent was in 2003 and before that it had not fallen that that low since 1958. The group cited slowing economies both at home and abroad as part of the reason for the cut. "Moreover, the intensification of financial market turmoil is likely to exert additional restraint on spending, partly... more »

Mortgage Demand Falls to Record Low

The number of U.S. mortgage applications submitted in the latest week reached an eight year low, according to data released Wednesday from the Mortgage Bankers Association. The MBA’s mortgage application index, fell dramatically by 16.6 percent to a seasonally adjusted 408.1 during the week ended October 17, 2008. That represent the lowest reading since December 2000. The Association’s home purchase application index, widely considered a timely measure of national home sales, fell 10.9 percent to 279.3, and the demand for refinance home loans plummeted down 23.5 percent to 1,158.8. Not even falling interest rates during the same period were enough... more »