Denver Mortgage Loans and Denver Home Equity Loans
Mortgage article from the Denver Post:
A jubilant Wall Street barreled higher Tuesday after the Federal Reserve cut its benchmark interest rate by a larger-than-expected half percentage point.
Read the full article: Dow does rate victory dance
Mortgage article from the Denver Post:
Consumers and businesses struggling with tight credit markets should find relief from the Federal Reserve’s cut in interest rates Tuesday.
Read the full article: Relief for U.S. credit crunch
Mortgage article from the Rocky Mountain News:
The House on Tuesday approved a plan to expand federal backing of mortgages in hopes of helping struggling homeowners avoid foreclosure.
Read the full story: House bill would aid homeowners facing foreclosure
Fed Funds Rate down .5%
WASHINGTON (Reuters) – The U.S. Federal Reserve on Tuesday slashed the benchmark federal funds rate by a half-percentage point in a bold bid to buffer the economy from a housing slump and related financial market turbulence.
ADVERTISEMENTThe decision by the central bank’s Federal Open Market Committee took the overnight rate down to 4.75 percent, its lowest level since May of last year. It was the first cut in the interbank rate — the Fed’s main tool to influence the economy — since June 2003 and the first half-point reduction since November 2002.
Financial markets had widely expected the Fed to lower overnight borrowing costs, but were split over whether the move would be a quarter-point or more-aggressive half-point.
In a related move, the Fed also lowered the discount rate it charges for direct loans to banks by a half-point to 5.25 percent.
What does this mean?
According to Marketwatch:
Here’s what consumers can expect:
If a consumer is paying 8.25% interest on a $100,000 loan that is based on the prime rate — such as a home-equity line — a rate reset to 7.75% is likely. That’s the difference of about $500 a year, or roughly $41.66 a month in interest charges. Resets on some adjustable-rate mortgages will be slightly better. Many ARM interest rates are based on an average of Treasury note yields coupled with a fixed margin, now at about 2.75 percentage points. At Tuesday’s 10-year yield of 4.49%, the rate is 7.24%. In July, it was at 7.77%. That makes the monthly payment on a $200,000 mortgage $1,363, about $73 less than it was in July. But Treasurys could head even lower following the Fed action. Rates on credit cards, which have taken on a bigger role in consumer financing in recent months, are likely to dip a bit too, lowering minimum monthly payments. Savings-deposit rates will go down, meaning that your bank balances won’t appreciate at the same rates you’ve seen all year. Ditto on money market rates, hurting those on fixed incomes — generally the elderly — who rely on cash generated from such safe investments. Interest rates on new loans for cars will fall, though it won’t have any effect on loans already in place. But Brian Bethune, the U.S. economist with Global Insight, urges consumers to wait until contract negotiations between autoworkers and their bosses are done this month. “They could pull out all the stops,” he said about automakers’ desire to unload inventory. And if the Fed lowers rates again next month, all the better.
Bait and switch is a sales tactic that seems to infiltrate every segment of industry. The words “sorry, that’s no longer available, but we have this ___(fill in the blank) available” could fit the car, computer, electronic, et. al. industries.
When your dealing with your homes financing, the last thing you really want to hear is that your mortgage term and rate are no longer available. However, in today’s mortgage world, the mortgage program that you were offered probably was available yesterday but may not be available today.
Home buyers and owners refinancing mortgages are increasingly finding at the closings that their lender isn’t honoring the deal they thought they had locked up.
Read the full story: Tough words on mortgage fraud
The Denver Post explores the mortgage credit crisis from the seller’s perspective:
Gone are the days of a quick sale and a hefty profit. The slumping market has homeowners slashing prices just to garner interest.
Staging is recommended as a means to get your home to sell faster. Also included were staging tips:
Get rid of clutter. Throw out or file stacks of newspapers and magazines. Pack away most of your small decorative items. Store out-of-season clothing to make closets seem roomier. Clean out the garage.
Wash your windows and screens to let more light inside.
Keep everything extra clean. Wash fingerprints from light-switch plates. Mop and wax floors. Clean the stove and refrigerator. A clean house makes a better first impression and indicates that the home has been well cared for.
Get rid of smells. Clean carpeting and drapes to eliminate cooking odors, smoke and pet smells. Open the windows.
Put higher wattage bulbs in light sockets to make rooms seem brighter.
Make minor repairs to problems that can create a bad impression. Small problems, such as sticky doors, torn screens, cracked caulking or a dripping faucet may seem trivial, but they’ll give buyers the impression that the house isn’t well- maintained.
Tidy your yard. Cut the grass, rake the leaves, trim the bushes and edge the walks. Put a pot or two of bright flowers near the entryway.
Patch holes in your driveway and reapply sealant, if applicable.
Clean your gutters.
Polish your front doorknob and door numbers.
Staging aside, here’s the advice most realtor’s worth their grain of salt will say: A HOUSE, PRICED RIGHT, WILL SELL.
Read the full article: SELLERS: New homes can undermine prices
Last December I had a subprime loan not go through underwriting with an approval. It was awkward for me since I pride myself on being thorough. The start reality is that it was the start of the meltdown of subprime mortgage companies.
The Denver Post explores this issue in depth:
Gone are the days of easy loans. Foreclosures and a subprime loan-market meltdown have left buyers scrambling to ante up.
The article is full of stories from buyers, sellers, investors, et.al. who have been impacted by the credit crunch.
Read the full article: BUYERS: Lenders tighten loan standards
The article is fairly accurate
I’ll always like sports more than mortgages so here are some very random sports observations:
Whenever the national and local media fails to deliver news that really means something, the Onion picks up their slack and delivers this gem:
There’s actually a blog devoted to Lower My Bills ads.
Mortgage banner ads aren’t nearly as irritating as mortgage telemarketers, mortgage offers in the mail, and mortgage spam.
Inman, a leading real estate news outlet, has an article entitled: Mortgage data links higher-priced loans with delinquencies
Blacks and Hispanics were also more likely to be stuck with higher-cost loans than whites. Under HMDA, higher-cost loans are defined as first-lien loans with annual percentage rates that exceed the interest rate on Treasury securities of similar maturities by 3 percent or more. The threshold for junior loans is 5 percent.
These statistics are often misleading. However, Inman does state:
Part of the difference in both denial rates and the incidence of higher-cost loans between ethnic groups can be explained by factors such as property location, income relied on in underwriting, and loan amount, Federal Reserve Board analysts said.
So this really issue isn’t black or white, it’s grey.
