FSBO Mortgage News and Updates
By Neil Irwin
Washington Post Staff Writer
Friday, February 5, 2010
The Federal Reserve would consider reopening its program to support the mortgage market if interest rates spiked or the economy showed new weakness, Federal Reserve Bank of New York President William C. Dudley said in two new interviews.
The Fed is buying $1.25 trillion in mortgage-backed securities in its effort to prop up the economy but has said it will end those purchases March 31.
In interviews with the Nightly Business Report and the Associated Press, Dudley said the time is right to end the program because the economy is growing and because expanding the purchases would make it harder for the Fed to unwind its support down the road.
But he said the Fed might reconsider if rates rose sharply. "Obviously, if mortgage rates were to back up a lot and if that had a big consequence for the economy, then we very well could rethink the issue about whether we wanted to buy more mortgages," Dudley told the Nightly Business Report. He made a similar comment in the AP interview.
The Fed said after its policymaking meeting last week that it "will continue to evaluate its purchases of securities in light of the evolving economic outlook and conditions in financial markets."
February 5, 2010
Long-term home mortgage rates inched up this week, but they're still at bargain levels.
The average 30-year, fixed-rate mortgage climbed to 5.01 percent from 4.98 percent last week, mortgage giant Freddie Mac said Thursday.
The average 15-year, fixed-rate mortgage edged up to 4.40 percent from 4.39 percent.
Five-year, adjustable rate mortgages also rose to 4.27 percent from 4.25 percent, while the average one-year ARM fell to 4.22 percent from 4.29 percent.
Mortgage rates were up slightly in the latest weekly mortgage survey, 30 year mortgage rates are back above 5.00 percent at 5.01 percent. Fixed conforming mortgage rates were higher and adjustable conforming mortgage rates were mixed.
The average conforming 30 year mortgage rate increased to 5.01 percent with an average mortgage discount point of 0.7 points for the week ending February 4, 2010, up from the prior week’s average mortgage rate of 4.98 percent.
Conforming 15 year mortgage rates increased to 4.40 percent with an average 0.7 mortgage points, up from the previous week’s average mortgage rate of 4.39 percent.
5 year adjustable mortgage rates increased to 4.27 percent with an average 0.6 mortgage discount points, up from last week’s average home loan mortgage rate of 4.25 percent.
1 year adjustable rate mortgages decreased to 4.22 percent with an average discount point of 0.5 points, down from the prior week’s average mortgage interest rate of 4.29 percent.
For a more extensive report on today’s mortgage interest rates, MonitorBankRates.com released its Weekly Mortgage Report on Monday, which follows:
Mortgage Rates
The average conforming 30 year mortgage rate is at 5.05 percent this week, up slightly from the prior week’s average home loan interest rate of 5.04 percent.
Conforming 15 year mortgage rates are at 4.40 percent this week, unchanged fom last week’s average loan interest rate.
Jumbo Mortgage Rates
30-year jumbo mortgage rates are averaging 5.74% this week, down from the prior week’s average home loan rate of 5.86%.
15 year jumbo mortgage loans are averaging 5.21% this week, down from the prior week’s average mortgage loan rate of 5.24%.
Adjustable Mortgage Rates
Conforming 1 year adjustable mortgage home loan rates are averaging 4.23% this week, down from the prior week when one year home loans were averaging 4.32%.
Conforming 3 year adjustable mortgage rates are averaging 4.42%, down from last week’s average home loan rate of 4.52%.
Conforming 5 year adjustable mortgage loan rates are averaging 4.14% this week, down from the previous week’s average mortgage rate of 4.20%.
Conforming 7 year adjustable home loan rates are averaging 4.59%, down from last week’s average home loan rate of 4.61%.
Conforming 10-year mortgage rates are at 4.99%, a decrease from the previous week’s average mortgage rate of 5.11%.
Jumbo Adjustable Mortgage Rates
Jumbo 1 year jumbo adjustable mortgage rates are averaging 5.30% this week, down slightly from the prior week’s average home mortgage loan rate.5.31%.
Jumbo 3-year jumbo ARMs are averaging 5.25% this week, down from last week’s average adjustable interest home loan rate of 5.32%.
The average 5 year jumbo ARM is at 4.91% this week, down from the prior week’s average home interest mortgage rate 0f 4.99%.
7 year jumbo ARMs are averaging 5.44% this week, up from last week’s average loan mortgage rate of 5.37%.
The average 10 year jumbo is at 5.92%, down from the prior week’s average 10 year mortgage loan rate of 5.88%.
Conforming Interest Only Mortgage Rates
3 year interest only mortgage rates are averaging 4.59% this week, down from last week’s average interest rate of 4.65%.
5 year interest only loans are averaging 4.31% this week, unchanged from last week’s average five year interest only mortgage rate.
7 year IO home loan rates are averaging 4.75% this week, down from last week’s average interest rate of 4.81%.
Jumbo Interest Only Mortgage Rates
3 year jumbo interest only mortgages are averaging 5.58% this week, up from last week’s jumbo interest mortgage rate of 5.52%.
5 year jumbo IO loan rates are averaging 4.91%, down from the prior week’s average IO mortgage rate of 5.39%.
The average jumbo 7 year IO loan mortgage rate is at 5.85%, up from last week’s average jumbo rate of 5.76%.
Home Equity Loans Rates
The average home equity loan rate was up considerably this week over last. 10 year home equity loan rates decreased to 7.416% this week, down from last week’s average equity home loan rate of 7.418%. 15 year home equity rates were unchanged this week at 7.517%.
Home Equity Line of Credit (HELOC) Rates
Average home equity line of credit rates were down slightly this week over last. The average HELOC rate is at 4.905% this week, down slightly from last week’s average HELOC rate of 4.906%.
When given the opportunity, criminals will target whom they perceive as the weakest among us. And that notion could become even more apparent as Utah and the nation cope with the bursting of the real estate and economic bubbles.
The Salt Lake office of the Federal Bureau of Investigation and the Utah Division of Real Estate have compiled a list of the potential top five mortgage related rip-offs in 2010. Chief among them: a reverse mortgage scam targeting the elderly.
"Scam artists are always looking for new ways to reinvent the same crime," said Michelle Pickens, special agent and mortgage fraud coordinator with the FBI. "The reverse mortgage scam is based off the 'straw buyer' model where they use senior citizens … against their own mortgages."
Reverse mortgages can be a legitimate way for homeowners to take equity from their homes without a monthly payment, which can be especially useful to seniors who need supplemental income during retirement, she said.
Unfortunately, con artists sometimes convince seniors they can live in a home for free, obtain a home loan under the occupant's name and disappear with the equity, while leaving the victim to repay the mortgage.
Pickens, who is also a member of the white-collar crime squad, said her agency implores homeowners to investigate any third-party offers to take over their mortgage by contacting the FBI or the state real estate division.
"They've got to be very careful and very 'due diligent' to make sure the company or individual they're (working with) is legitimate," she said.
Others schemes to be aware of include short-sale fraud, in which a homeowner and a lender agree to sell a property for less than the mortgage amount. The fraud occurs when a distressed homeowner finds a prospective buyer and they secretly set a different sale price.
Unbeknownst to the lender, the buyer is willing to pay more for the property and the homeowner pockets the difference.
Another "kickback" scam is the builder bailout, which is more common in areas affected by a large surplus of unsold properties, an FBI release stated. A homebuilder offers excessive "incentives" to a buyer, but the incentives are disclosed as a down payment, leading the lender to believe there is equity in the property. Under those circumstances, the builder and the buyer are committing fraud.
Fourth on the alert list are loan modifications in which companies charge up to $2,000, promising to make a homeowner's mortgage payment more affordable. But some homeowners report that they didn't get what they paid for, the release said.