We all know the mortgage industry, and the requirements to qualify have tightened. The two big areas that affect a majority of the population are credit scores and down payment requirements. In the last 18-24 months, guidelines now require the borrower to have a little better credit score to qualify for the same type of loan program. Also, the required credit score to be granted maximum financing has increased…..most loan programs used to require a 580 credit score and now most loan programs require 620. In addition, mortgage programs do not allow the borrower to ignore as many open collections/charge offs. So the need for credit repair services have skyrocketed to the point where new companies are popping up and advertisements are everywhere. When considering a credit repair company, make sure you are not employing the services of a Consumer Credit Counseling Service (CCCS) that negotiates lower rate/payments as lenders view this as the equivalent of a bankruptcy. Think about this, a bankruptcy court provides relief by forcing creditors to accept a lower payment and a CCCS negotiates a lower payment for you. Both of these are the result of financial irresponsibility and taking on more debt than you can handle….which is not what you want a potential lender to think of you.

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     Interest rates are offered with varying costs. If you call a lender today and get quoted 5.0% for a 1% origination point (1point = 1% of the loan amount) and hear tomorrow that rates have dropped, it doesn’t necessarily mean that the same 1% (or 1 point) gets you a lower rate. Example: Today the following rate/fee combinations are offered 4.75% for 2.0 points, 4.875% for 1.5 points and 5.0% for 1 point. So the next day you hear rates have dropped and think you are going to get lower than 5% for the same 1 point fee, but are told the following: 4.75% now costs 1.875 points, 4.875% now costs 1.25 points, and 5.0 costs .75 points. This causes confusion for people who are not in the industry because they think they are going to get a lower rate for the same amount of fees. The confusion lies in the fact that it’s not the rate that is dropping; it is the cost for any given rate that you choose.

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Stock Rally Pushes Mortgage Rates Higher

     While the economic data released during the week generally matched expectations, the outlook for future economic growth improved due to strong earnings reports, tame inflation data, and a revised forecast from the Fed. Stronger economic growth was good news for the stock market, and the Dow rose over 500 points. It was unfavorable for the bond market, however, and mortgage rates ended the week moderately higher.

     On Wednesday, the Fed released its minutes from the June 24 FOMC meeting, and most of the news was negative for mortgage rates. The minutes revealed an upward revision to the Fed's forecast for economic growth and inflation in 2009 and 2010. In addition, Fed officials expressed a strong reluctance to increase any further the program to purchase mortgage-backed securities (MBS). Mortgage rates are largely determined by MBS prices. When the Fed initially announced its MBS purchase program in November, mortgage rates immediately dropped, and they dropped again significantly when the Fed announced an increase in the program in March. The Fed has a substantial involvement in MBS markets, and any change in this program would have a major impact on mortgage rates.

     The housing sector data released during the week showed improvement. June Housing Starts rose 4% to the highest level in seven months. Building Permits, a leading indicator, jumped 9%. The national Association of Home Builders (NAHB) sentiment index increased to the highest eric.glick@bankofamerica.com level since September 2008. According to the NAHB, the first-time homebuyer tax credit, low mortgage rates, and "attractive" home prices are helping home sales.

Week Ahead

     The economic calendar will be very light next week. Leading Indicators will come out on Monday, Existing Home Sales will be released on Thursday, and Consumer Sentiment will come out on Friday. In addition to the economic data, Fed Chief Bernanke will be testifying before Congress on Tuesday. Finally, Thursday's announcement about the size of upcoming Treasury auctions also may have an impact on mortgage rates. To learn more about news impacting interest rates and mortgage markets, go to www.mbsquoteline.com To learn more about the newsletter, please call 800-627-1077 All material Copyright © Ress No. 1, LTD and may not be reproduced without permission.

Report courtesy of Eric Glick

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When someone asks me: What works for you when trying to sell a home? I give them a very straight forward answer: virtual tours. When I first started looking back on things to do differently, and things to change to make my business better, this stuck out like a sore thumb.

Real estate agents, even though only a few were actually taking advantage of it, were having virtual tours done on their homes for sale. I watched a few - it captivated me to watch them walk through the home, showing and explaining every inch of the house. I did not even have to leave my home to know if I was going to like the home or not! From that point on, I knew I had to change. I looked into different options for myself and finally came upon a small company that does this exact thing: Creative Media Factory, located here in Savannah Ga. I contacted them, had my first virtual tour completed (I must say it was a little odd stepping in front of a camera for the first time), and was amazed by the results. No doubt my homes with virtual tours get more looks and more calls into the office.

I must say, I am surprised it works so well, but pleased all the same.  We have sold homes to military that have been deployed overseas and others that just don’t have the luxury of seeing the home in person.You might catch a few virtual tours here: www.realestateranger.com

When time is of the essence to purchase a home, this helps speed up the process greatly. Some of the times, I have seen many listings with no pictures or very few pictures. I’ve noticed buyers won’t even take the time to look at these. I have also noticed that it helps make the customers more adapt to contacting the agent.

I must say, I take pride in paying professionals to do particular marketing techniques for us, for the simple fact that they specialize in it and know far more than I do about it!

Anyone have any similar experiences? Do you use virtual tours?