Do banks still do mortgages?

By
Mortgage and Lending with Connecticut Home Mortgage

Do banks still do mortgages?

 

 

I have been getting quite a bit of questions lately such as are banks still doing mortgages?  Do you have to put 20% down?  Do you have to have perfect credit?  Are there any no income verification loans?  Are rates going down?

So I thought I would share the answers:

Banks are very much still doing mortgages.

Fannie Mae, Freddie Mac, FHA will all still do loans with as little as 3% down at still very attractive rates.  VA and CHFA still do 100% financing

FHA will still write loans with credit scores as low as 580.  Fannie Mae and Freddie Mac are looking for 620 or better.

You can still do no income verification loans with as little as 25% down.

The Fed has been cutting the Fed Funds rate (a half of a percent this week to 1%) but fixed rates have stayed between 5.875 and 6.875 with no points.  The state of the economy and the housing market should have caused fixed rates to drop well into the 5's.  However, everything the Fed is doing:  cutting the Fed Funds rate, injecting billions of dollars into the banking system, the numerous bailout packages and stimulus packages have all been inflationary.  Fixed rates hate inflation.  Coupled with that is the fact that investors do not want to buy mortgage backed securities, now viewed as risky, at 5% when they can buy 10 year treasury notes at 4%.  This is keeping fixed rates in the 6's.  Still a historically awesome rate.  Try to get your clients off of the rate game and focus more on the great value they are getting now by buying both at low prices and low monthly payments.  As the economy and the housing market gets better and all this financial stimulation takes traction fixed rates should rise.

 Keep the questions coming and thanks for the business,

 

Dan Ianniello
Senior Mortgage Planner
Connecticut Home Mortgage
Cell:  203-910-7772

DanIanniello@cthm.com

 

I appreciate your referrals!

Comments (6)

Eric McGowan
Moody, AL

Dan, Good points. The media needs to get off of the "platform" about how bad everything is. When rates were even in teens in the 80's people were still buying houses and can do so still today.

Oct 31, 2008 07:05 AM
Associate Broker Falmouth MA Cape Cod Heath Coker
https://teamcoker.robertpaul.com - Falmouth, MA
Heath Coker Berkshire Hathaway HS Robert Paul Prop

Numbers are coming in higher in many parts of the country already.  Some banks are lending somewhere.

Oct 31, 2008 07:41 AM
Randall Schrader
Competitive Insurance of Dundee - Dundee, FL

Right on Eric, but if news was good we wouldn't need Obama to save us so badly.

Oct 31, 2008 08:00 AM
The Ward Team
Coldwell Banker Residential Brokerage - Newtown, CT
Realtors, ABR

Dan, excellent first post to AR - keep 'em coming.

Nov 01, 2008 08:06 AM
Hector Avila Mortgage Banker
Envoy Mortgage - Torrington, CT

Dan,

 

Great post, nothing can be further from the truth..

Nov 10, 2008 04:39 AM
Paul McFadden
Responsive Pest Control - Seattle, WA
Pest Control, Seattle, WA.

Thanks, Dan. I asked all my BNI group members to do me a favor today. That is spread the word that loans can be had! Take care.

Nov 10, 2008 01:18 PM