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Market & Product Update (March 07, 2013)

The US housing market is in the midst of a robust recovery aided by low interest rates, pent up demand, an increase in cash buyers, low inventory and rising prices. It’s the perfect combination of factors we haven’t seen in a very long time. Home prices are up 14% in California and many areas are experiencing inventory drops of 50 to 70 percent. To compete in this market, we strongly recommend buyers get preapproved for a mortgage. We can provide a Pre-Approval letter quickly and at no cost to you. Our purchase underwriting turn times are currently at 48 hours and for refinances 72 hours.

What we are hearing…

FHA Mortgage Insurance Premium Increases:
FHA will increase its annual mortgage insurance premium (MIP) by 0.10 percent for loans under $625,500 and by 0.35 percent for loans above that amount. Examples: For a conforming loan of 417,000 the monthly premium will go from $434 to $469, for loan amounts of 625,500 from $651 to $703, and loan amounts up to 729,500 (FHA Max) from $759 to $972 per month. Upfront premiums (UFMIP) will also increase by 0.75 percent. These increases are scheduled take effect within the next few months.

Dignity Mortgage?
With home prices and interest rates rising and builders re-entering the market, some housing advocates are calling for a new kind of loan for buyers with lower incomes or credit issues. They are calling it the Dignity Mortgage, but it has another name we are all familiar with…subprime. These applicants lost their jobs, their homes and damaged their credit scores four or five years ago during the mortgage meltdown. Many have since found new jobs and saved up enough for a 5%-10% down payment. This new product will be designed to help these types of borrowers.

Reduction in Loan Limits:
A bipartisan housing commission is recommending a gradual reduction of the current Fannie Mae, Freddie Mac, FHA and VA loan limits. This is part of a strategy to wind down the role of Government Sponsored Entities and encourage the private sector to play a larger role in home financing. Stay tuned.

HARP 2.O Refinance Program Update:
We recently changed the loan to value (LTV) requirement for non-owner occupied (Rental/Investment) properties from 105% to 150% LTV. (LTV for owner occupied properties is still unlimited) This will help responsible landlords refinance their “under water” mortgages and take advantage of current rates. Should the mortgage on your rental be 150% or less of the property’s estimated value, please call us so we may begin the process to lower your rate.

Mortgage Rates:

Most forecasters are predicting that mortgage rates will rise in 2013. The Federal Reserve is doing all it can to keep mortgage rates low by buying $85 billion a month in treasuries and mortgage-backed securities, so any rise in rates will be muted by their efforts. We see mortgage rates staying close to where they are now for the first half of 2013 and rising slightly through the remainder of 2013

 

Current Conforming Rates (Pmyts based on a average loan amount of $250,000) for a historical perspective on rates please visit my blog on our website

Loan Program

Monthly Pmyt

Rate

APR

Points

30YF

$1140

3.625%

3.75%

0

20YF

$1449

3.50%

3.87%

0

10YF

$2414

3.00%

3.125%

0

15YF

$1711

2.875%

3.125%

0

5/1 ARM

$1037

2.875%

3.125%

0

7/1 ARM

$1070

3.125%

3.375%

0

FHA 30YF

$1105

3.375%

3.87%

0

FHA 15YF

$1696

2.75%

3.00%

0

 

Current High Balance Rates – Max Loan Amount $625,500 (Pmyts based on a avg loan amount of $550,000)

30YF

$2941

3.875%

4.00%

0

15YF

$4357

3.125%

3.87%

0

5/1 ARM

$2595

2.875%

3.00%

0

7/1 ARM

$2637

3.00%

3.25%

0

FHA 30YF

$2808

3.50%

4.00%

0

 

Disclosure: These are our current conforming and High Balance rates based on primary residences only, your actual rate could be higher depending on several “Risk Factors” such as credit score, LTV, Cash-out, Investment prop, 2nd home, zero cost etc. Please call us for an accurate custom quote including jumbo loans up to $2 million and beyond

The cornerstone of Trulending Mortgage is a fierce commitment to integrity, service and expertise and these core values have, thankfully, resulted in client relationships for life. We appreciate the opportunity to work with you on your next refinance or home purchase transaction. Visit our testimonial section to see what our customers are saying. Please pass this along if you think we can help any of your close friends or family.

 

 

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