April 21, 2007

Yes I'm still here. There hasn't been much of anything going on in the mortgage market other than the issue with lenders going under. Not to make it sound like it's not a big deal, but I advised everyone of this a month ago so it shouldn't be news to you. We're continuing to see a lot of fallout from the subprime industry. Probably the biggest change is in the 100% financing arena. If a borrower has to do stated income, 100% financing, the minimum credit score is now at 680...and that's with very few offering it at all. Before all the mess, we could go as low as 620. Bottom line, just be diligent in making sure your clients are qualified so the deal doesn't fall through in the middle of escrow. I predict, as we get further into the year, there will be more lenders offering stated income, 100% financing at lower credit scores.

As for rates, not much movement. There was a brief panic in the bond market earlier this month from the March jobs report. Basically the labor market showed much more strength than anticipated sparking wage inflation fears and sending the bond market downward. We witnessed a small spike in bond yields and that translated into a small spike in mortgage rates. Despite the great rates, mortgage applications continue to drop from week to week due to the shake up in mortgage lending. Right now a conforming 30 year fixed is at 5.875% with jumbo 30 year fixed hovering right around 6.125%. Going with an adjustable rate product won't save you a whole lot as a 5 year fixed is at about 5.625%. It's the same story, rates won't move significantly until the FED decides it's necessary to lower interest rates. Right now the economy is growing with little worry of immediate inflation so I don't think the FED will lower rates anytime soon. The DOW is flirting with the 13,000 level for the first time and there doesn't seem to be anything to stop it from going higher.

I'll keep you posted!

CC

NEW ADDITION!
My newest addition is the MP3 audio clip library. Having received many questions, I decided to answer them the same way I answer them if you call me....by talking through the topic. They are a lot of fun and are a great addition to all the written materials on the site.

If you are shopping for a home right now and need to get prequalified for a home loan, click here for my easy-to-use form that you can fax back to me.