March 11, 2010
The foreclosure rate fell 2 % nationally in the month of February in a monthly comparison, according to a report released by Reatly Trac. The total number of repossessions dropped to 78,683 compared to the 87,648 in January. There are many reasons that could be linked to the drop in the foreclosure rate that are being taken into consideration by economists.
One of the main concerns is the foreclosure prevention programs. While lenders are determining whether or not the distressed home owner qualifies for the mortgage modification program, the home owner is not put into default at that time, temporarily affecting the status of the foreclosure. Which would mean the report by Realty Trac could be “artificially depressed.” Due to this fact, it is possible that the numbers of foreclosures in March could be higher than would be expected.
Six of the states across the nation accounted for 60% of all of the foreclosures filings, those state were Arizona, California, Florida, Illinois, Michigan and Texas.
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March 8, 2010
It’s been another great week for those looking to refinance or purchase a home, as mortgage rates have dropped below 5% again! Mortgage rates were 5.05% last week, coming in at 4.97% this week, the mortgage rates on a 30-year fixed rate mortgage have dropped to a level that was unexpected by many economists.
Mortgage giant, Freddie Mac collects mortgage rates Monday through Wednesday each week, from national lenders. As rates are closely tied in with treasury bonds, it is not uncommon for them to fluctuate significantly even from day to day.
The FED has pumped $1.25 trillion into mortgage backed securities in an effort to keep the mortgage rates at or around 5%. This program is set to expire at the end of this month; however there has been talk about extending the program, if the economy weakens.
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February 26, 2010
Mortgage rates are collected Monday through Wednesday of each week by mortgage giant, Freddie Mac. This week’s results show that the interest rates have jumped from 4.93% last week to 5.05% this week. Although these rates appear high in comparison to the last few months, they are still attractive to potential homebuyers or those looking to refinance.
The FED has been pumping $1.25 trillion into mortgage backed securities in an effort to maintain the mortgage rates at around 5%. This program is scheduled to expire at the end of March, however the FED has mentioned being open to extending the program if the economy begins weakening.
Mortgage rates do not include add-on fees, also known as points, each point is the equivalent of 1% of the total loan amount.
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February 23, 2010
According to RealtyTrac, the number of homes across the nation that are facing foreclosure increased 15% in January, during an annual comparison. Just in the month of January alone, 315,000 homeowners across the nation have received some form of foreclosure notice.
Do keep in mind; this number is down nearly 10% from the end of 2009! Although these numbers appear to be declining, economists still believe that these figures indicate another surge of foreclosures that will be hitting the market by the spring of this year.
One drastic change in the market will be the expiration of The Homebuyer Tax Credit, a program that provides an $8,000 tax credit for qualified first time homebuyers as well as a $6,500 tax credit for qualified repeat homebuyers. Scheduled to expire during the spring of this year, the loss of this program could result in a brief surge in home sales by those looking to take advantage of this government program, but it’s not expected to last.
Mortgage rates have managed to remain around 5% due to the FED purchasing $1.25 trillion in mortgage backed securities from Freddie Mac, Fannie Mae and Ginnie Mae. This program is also expected to be expiring by the end of March.
The sequence of these events will leave the troubled market to fend for itself by the end of this year. Do you think the market will be strong enough by then? Do you think it’s ready to stand on its own two feet? With all the money the government has been pumping into the real estate market, will it be ready to function on its own? These are the very questions that many economists are pondering today.
Locally, Florida was one of the last states to recover from the recession, which puts us in a good news/bad news scenario. The bad news is the length of suffering that we’ve endured over the last few years; the good news is that residents of the other states that have recovered will more than likely be vacationing in Florida.
It is forecasted that many visitors will be looking to get in on the tax credit before it expires. And as spring is Florida’s “real estate buying” season, perhaps many will be looking to purchase homes while they are here.
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February 22, 2010
The answer to that is “Yes”!! Even though the foreclosure situation is still an issue, it appears that less people are faltering on their home loans. According to the Seattle Times, the Mortgage Bankers Association stated the percentage of homeowners missing only one loan payment dropped .2% in the 4th quarter of 2009 from the 3rd quarter. The Nevada Appeal printed that numbers are down for the first time in 3 years of borrowers that are delinquent on at least one payment but where the foreclosure process has not yet begun. These are very good indicators that recovery is in sight!
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February 16, 2010
During the fourth quarter of 2009, home prices rose in over 40% of the cities nationwide! According to the National Association of Realtors (NAR), the median sales price for previously occupied homes was $172,900 by the end of December.
The surge in home sales is believed to be mostly contributed to the federal tax credit for first time homebuyers. The $8,000 tax credit was scheduled to expire on November 30, 2009, however the federal government extended and expanded the program to continue until the spring of this year.
Two things are concerning economists:
1. Will the huge backlog of foreclosures turn the home prices downward once they hit the market?
2. Will the slightly visible recovery in the real estate market make a U-Turn once the FED pulls back support?
Only time will tell…
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February 15, 2010
Despite all the talk of mortgage rates staying above 5%, they fell slightly this week, bringing the rates on a 30 year fixed rate mortgage to 4.97% according to mortgage giant, Freddie Mac.
Low interest rates are attractive to first time homebuyers as well as those looking to refinance their current mortgage. Due to the FED pumping nearly $1.25 trillion into mortgage backed securities, the current mortgage rates have managed to hover around 5%. The government program is scheduled to expire this spring, causing many economists to believe that the days of low mortgage rates are coming to an end.
Rates are collected from Freddie Mac weekly Monday through Wednesday from lenders nationally. Rates can fluctuate drastically, even in a given day as they are closely tied to treasury bonds.
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February 9, 2010
The extreme low home prices are attractive to first time homebuyers as well as investors. Investors however, are coming to the table armed with cash, making purchases difficult for first time homebuyers looking to finance.
Here in Florida home prices have declined drastically making it a perfect target for the real estate battle on homes priced below $300,000. Financing has become more difficult over the past year, giving cash buyers an upper hand in the battle. A survey conducted by the trade association revealed that nearly 22% of all previously owned homes that were sold nationally in December were purchased with cash. This marks the highest level since spring of 2009.
According the Jed Smith, researcher for the National Association of Realtors (NAR), “Even though a first-time buyer may be offering the same price as an investor, or a higher price, the investor has the edge, the investor may actually pay less, but it’s cash, right now.”
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February 5, 2010
According to Mortgage giant Freddie Mac, rates on a 30 year fixed mortgage rose slightly this week to 5.01% from 4.98%. Rates are still significantly lower than last years 5.25% and still attractive to homebuyers and those looking to refinance, however many economists believe that the rise in rates is only the beginning.
As the Federal Reserve has put $1.25 trillion into mortgage backed securities in an effort to keep the rates hovering at approximately 5%, the program is expected to expire this spring. The mortgage rates do not include add-on fees also known as points. According to Freddie Mac’s survey, the fee averaged .7 point for 30 year and 15 year mortgages nationwide.
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February 2, 2010
In an effort to clear out the tens of thousands of properties that Mortgage Giant, Fannie Mae has in their inventory, the company announced last week that it will begin to provide aid towards the closing costs for homebuyers that purchase foreclosed homes.
Last year Fannie Mae created the HomePath website to help sell the continuous growing number of foreclosures. The offer to pay for closing costs is only applicable to qualified homes located on the website. Any buyer that closes on the purchase of one of these homes by May 1, 2010 may be eligible to receive 3.5% of the closing costs or an amount that is equal to the purchase of new appliances.
According to Terry Edwards, the executive vice president of Credit Portfolio Management, “Attracting qualified buyers to the market and reducing inventory of vacant homes is critical to stabilizing neighborhoods and helping the market recover.”
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