The Federal Reserve Board's Open Market Committee lowered two key rates today. The Fed Funds Rate and the Discount window rate by 1/2 percent. This should create some easing of mortgage rates. Thus far even without the action by the federal reserve mortgage rates have been declining into this September meeting. I would anticipate that the lowering of these rates will assist the market in relaxing the credit crunch to some extent. However, many of the systemic issues that are currently plaguing the mortgage market will persist. There's good news for Tulsa and Oklahoma in general - the Greater Tulsa Association of Realtors statistics through July 2007 show the area as fairly stable with slightly rising property values. I would expect this area to remain stable. On the mortgage side, our team here at Cityscape Home Mortgage has been able to fund every loan submitted through Brett for our clients this year. Although there have been some challenges with tightening guidelines we're still providing money for home buyers.
Brett.......
I have been watching the news the afternoon and I think this could help the housing market start to pick pack up. I guess we watch and see what happens.
Brad,
I hope you're right. I notice you're in Arizona, is that correct? I am very concerned about the guideline issues in the background. If the credit freeze doesn't thaw soon, then we will see increasing requirements placed on borrowers and only the best of the best will get through the maze. The adjustment now of 100% financing moving from the 580 credit score of January to 600 in February, 620 in April and now some at 640 is a problem for many borrowers without the 5-10% down payment. Also, the lack of higher LTVs in the Jumbo market place is also stressing borrowers. I think that we will need to see more negotiations for a seller carry second in the weaker credit groups, and this will be a problem in areas of low or negative appreciation. So, while the relaxing of credit at the federal reserve level is generally a good thing, there are still a lot of issues remaining to wash out of the mortgage markets.
Best,
Brett
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