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Tim Hall:
Licensed Real Estate Broker, actively selling since 1993. Co-founder of Re/Max Central Properties, with my wife, Bell Hall, and team-leader for a team of 7. BA from Capital University and a US Navy Veteran CU-60 U.S.S. Saratoga. Father of 3 - Alicia, Erica, and Amber; and grandfather of 1, Ava.
Home > Blogs > Greater Dayton Home Report > Archives > 2008 > January > 17 > Entry
Rates Falling, Refi’s Rising ! Bernanke economic “Stimulus Package”
According to the Inman News Service, an excellent real estate centric reporting agency, mortgage application volume during the second week of January posted a huge increase as interest rates continued to decline, per the Mortgage Bankers Association report released last night. Why, because the SMART MONEY takes advantage of short-term opportunities!
An excerpt of the article follows. Now COMBINE this with the highly anticipated Fed economic stimulus package and you get a “Grand Slam” for existing home owners.
Let me explain.
- Congress passed legislation to soften the tax impact to home owners forced to sell their homes via short sale, or forclosure. This will speed up the transition to a blanced supply.
- Home builders have reduced their new construction over 60% from the highs of 2005; 700K new homes in 2007 versus 1.7 million homes in 2005.
- Rate cuts, BIG cuts, are ahead.
Here is how to make the most of this opportunity. If you don’t have to sell, don’t. If you have a mortgage, find out TODAY what the terms are. You need to know the balance, the interest rate, the years remaining and if you have any pre-payment penalty.
Seriously, I believe that the INSTANT there are signs of the housing slump hitting bottom, that the cost of mortgages goes back up. The FED doesn’t want a repeat of what got us into this mess to begin with. SO, you win if you are thoughtful enough to gather the above information and watch rates. I happen to own some rentals, my personal residence and a commercial building. I can’t watch rates constantly so I leave that to my banker. If you want him to watch rates for you, send me your contact info at tim@timhallteam.com and he will get in touch. These rates can turn on a dime, and my goal is to catch historic lows, just like I did in the past.
Tim
Here’s the excerpt
Home loan apps jump 28%
Refis see another large gain as interest rates slide
Inman News
Mortgage application volume during the second week of January posted a huge increase as interest rates continued to decline, the Mortgage Bankers Association reported today.
The group’s market composite index, a measure of home loan application volume, climbed 28.4 percent on a seasonally adjusted basis between the first and second weeks of January. This double-digit gain comes on the heels of a 32.2 percent rise in the index one week earlier, the largest in four years.
The index that tracks refinancings posted the largest gain, rising 43.4 percent last week on a seasonally adjusted basis from the week before, while the index tied to purchase loans grew 11.4 percent.
According to MBA, the average contract interest rate on 30-year fixed-rate mortgages sank to 5.62 percent from the previous week’s 5.73 percent, and the average rate on 15-year fixed loans dropped to 5.07 percent from 5.21 percent. Rates on adjustable-rate mortgages (ARMs) fell sharply during the period, with the average one-year ARM tumbling from 6.04 percent to 5.77 percent.
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Comments
By John
January 24, 2008 11:51 AM | Link to this
I would like to see rates on 30 year fixed go under 5%. I think people would then start paying attention. I would.By Tim Hall
January 29, 2008 4:14 PM | Link to this
I think we may see it, but I know I won’t wait for 5% to refi my loans! If you look at the 10 Year Treasury, stock cymbol TNX, you will see its price change tick by tick. The 10 Year is an index that generally reflects loan rates. I feel that if anyone can shave 1/2 point off their loan, OR if they can go from variable to fixed, go for it! Just demand no pre-payment penalty!