Fed's announcement last week is aimed at keeping mortgage rates low for a long time and spur housing and economy. The trillion dollar question is - will it actually achieve that aim? It sure faces a lot of hurdles. (By the way if you missed Fed's announcement, Read the news here reported on this site.) The Fed's $1.25 trillion of mortgage bond purchases that ended in March 2010, is widely believed to have substantially brought the mortgage rates down. According to Mahesh Swaminathan, Senior Mortgage Strategist at Credit Suisse, the new action by…
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Breaking News – California Mortgage Rates Sink After Fed Announcement
Ben is at it again. Guns Blazing, Fed announced they are all in for as long it takes. Earlier this morning Fed made the statement that they would buy $40 billion each month of agency mortgage-backed securities on an open end basis. Fed would even extend those purchases and buy additional assets if the job market doesn't improve. I know you are going like "Shashank - thats too much technical stuff. What does that really mean to me?". Well one sentence answer - a much better mortgage rate. Lets see how it works.…
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California Mortgage Loans to become more expensive – Courtesy of G-Fees
FHFA (Federal Housing Financial Agency) recently announced increase in Guaranteed Fees (aka G-Fees) for all Conforming Fannie Mae and Freddie Mac loans originated in California and rest of the country. Let's try to understand what the G-Fees is and how does it impact you. G-Fees defined (From Fannie Mae website) A guaranty fee, also referred to as a “g-fee, is one of the costs reflected in the interest rate on a single-family mortgage loan. This fee represents the charge by government-sponsored enterprises (GSEs) like Fannie Mae and Freddie Mac to guarantee that an…
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Fannie Mae Guideline Changes Coming to a California Loan Near You
Fannie Mae is set to release a new version (9.0) of its automated underwriting system called DU (Desktop Underwriter) over the weekend of Oct 20th, 2012. Fannie Mae tightened some underwriting guidelines based on their performance data. Here are some highlights: Limited Review for Condominium to be capped at 80% (currently at 90%) - So if you are buying a condo in California with less than 20% down, you would need to provide more documentation related to the condo project. Usually these documents are provided by the HOA office. In some cases these…
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How will the Fed Announcement Impact California Mortgage Rates?
Fed chairman Ben Bernanke strongly defended the Fed $2.3 trillion in bond purchases since 2008, strengthening the case for another quantitative easing. He claimed it has helped create more than 2 million jobs and he was considering another installment. Top Fed officials believe that such programs help drive down long-term interest rates in California and rest of the country. The actual announcement is expected on Fed's next policy meeting scheduled on on Sept 12 and 13. Get a Live Mortgage Rate Quote Mortgage Markets reacted favorably to his statement with Fannie Mae 3.0%…
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In Most US Cities Buying Beats Renting – Not So Much in San Jose, San Francisco
Record low mortgage rates, discounted home prices and rising rents are making home buying extremely attractive in most US cities. More and more data released by several research are pointing towards buying making more financial sense than renting. According to RentJungle, rents have climbed 20% over the past 3 years. On the other hand, home prices have fallen 45% in five years. In a recent announcement, real estate valuation and listing site Zillow reported that in 75% of the 200 metro areas, homeowners would reach a "break-even point" in 3 years or less.…
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California Mortgage Rates for Refinance and Purchase Jump to 2 Month High
California Mortgage Rates for both Refinance and Home Purchase are now at a 2 month high - at their worst levels since early June. Freddie Mac today in its Primary Mortgage Market Survey announced that in the week ending Aug 16th, the 30 Year Fixed Rates climbed to 3.62%, 15 Year Fixed Mortgage to 2.88% and 5 Year Adjustable Rate Mortgage (ARM) to 2.76%. All these rates are with 0.6% points and standard closing cost. So on a $400k loan in California, that could be a total closing cost of approximately $5000. Also,…
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June 11, 2012 – Reduced FHA MIP For Some California Streamline Refinances
Starting June 11, 2012 some FHA Streamline Refinance borrowers in California, Washington and Oregon will be eligible for reduced FHA Mortgage Insurance Premium - both UFMIP (Up front Mortgage Insurance Premium) and Annual MIP. Launching its own version of HARP 2.0, HUD (Housing Urban Development) announced that these reduced FHA MIP would be available for homeowners who currently have an FHA loan "endorsed" before May 31, 2009. Note that FHA Loan endorsement date could be few days (or longer) after the loan closing date. Why should I consider doing an FHA Streamline Refinance?…
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Good News about Principal Reductions and Underwater Mortgage Refinances
After years of a declining housing market and no solutions in sight, there are two terms that are making the light of day: Principal reduction and Underwater mortgage refinance. As everyone knows, the housing recession began in 2007 when housing values started falling and homeowners could not sell their homes. Then people who were over their heads in mortgages they could not afford started defaulting on their loans. The rest is housing meltdown history. Now, five years later, it appears that a few members of the calvary are riding in with principal reductions…
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5 Ways to Pay Off Your California Mortgage Debt Faster
such as mortgage, credit card debt, student loan and so on. However, it is important to evaluate one own personal financial situation before implementing any such debt relief tips. This is to ensure that you benefit from such advice and not further pile up debts that you become responsible for. So, here are 5 strategies to repay your california mortgage faster. Make Extra Payments: If there is no pre-payment penalty, you can make extra payments on the mortgage loan. The extra amount of money is taken off from the principal mortgage amount. For…
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