All homebuyers and perspective clients interested in refinancing should recognize interest rates are on the rise. The recent successes in the stock market, poor bond market and international speculations regarding the crisis in Egypt and it's possible impact on the global economy are focusing investors cash flows away from the bond market and MBS market; resulting in a selloff in the bond market and a drastic decline in the yield in the treasury market. (Causing higher mortgage rates) Anyone in the market for a mortgage should do their best to get their rates locked in as soon as possible. Many industry experts say that rates will continue to rise as investors are now confident that real estate values have now stabilized. This thought process is echoed even louder as Fannie/Freddie raise their pricing to historic highs. Fannie Mae and Freddie Mac have recently raised their "risk-based pricing hits" and this translates to higher rates and costs to all conventional mortgages. In addition, FHA has recently changed their UFMIP/MIP pricing. They have lowered their up-front funding fee(which is allowed to be financed) and raised their monthly fee, thus allowing them to recognize a higher monthly profit to offset their record high losses. These are all indications that the "powers that be" feel that the real estate market can withstand these higher costs due to the increased demand in real estate now that we have hit rock bottom values. In most regions/zip codes across the country we have seen property values increasing since last summer/last fall and this is getting the federal government more greedy.
DJ Rondeau
Bay to Bay Lending, L.L.C.
501 South Dakota Ave, Suite 2
Tampa, FL 33606
813-489-5562- Office
813-480-6077- Mobile
813-464-2867- Fax
djrondeau@baytobaylending.com
www.tampafloridamortgagebroker.com
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