Tag - mortgage rates

Low Mortgages Rates are Propelling Wave of Cash-Out Refinances

The continuation of favorably low interest rates has propelled a wave of cash-out refinances, the most we have seen since the financial crisis of 2008. Many think this is cause for concern, but its not; at least not yet. Given the rapid growth in the home process in the last year, the share of cash-out refinances isn't terribly high. There were more during earlier housing booms, including the housing crash 15 years ago. A cash-out refinance allows a borrower to swap their current loan for a new one with a higher balance. So, homeowners can pay off their old mortgage and still have cash left over. A recent report found that in 2020 the amount of equity tapped into through cash-out refinances increased by 42%. These days, it appears that most borrowers are using the funds to pay down other debt and to update their homes. Home improvement spending sky-rocketed during the pandemic. Homeowners are sitting on a lot of home equity right now and what a lot of people are doing is taking this money, getting a cash-out refinance, and using the cash to make renovations to their home. Many projects from adding a screened-in porch, updating a bathroom, creating a home gym or adding an official home office all add to overall value of a home. These are smart moves to make as the improvements are actually going to help their home sell for a significantly higher amount of money in a few years. It's important to do home improvements that are low cost but add the biggest value to your home. Interested in looking into the amount of equity you could tap into? Reach out about a cash-out refinance. Whether you are looking to pay off some debt or complete a home remodel, we can help guide you ever step of the way. Call today! 801.206.4343

*Source: Kiplinger Letter: Vol.98, No.10**


Mortgage Rates Move Lower after Last Week’s Fed Announcement

Monday Mortgage Rate Update

March 26th 2014

Mortgage rates stabilized this week in the wake of reaction last week to the Fed's hint that they would raise their rates sooner than the anticipated target date of late 2015. Even though the Fed fund rate is not directly tied to mortgage rates, even the smallest news that the Feds will hike their target rate can have a profound effect on the financial markets. Last Wednesday, when the announcement came out, mortgage rates rose from 4.43 to 4.53, a full tenth of a percent. Because the financial markets had already had time to ponder news of the coming rate hike at length, however, reaction was not as extreme as it might otherwise have been. It now remains to be seen whether rates will come back down to the lower levels seen at the beginning of last week. Get a Customized Rate Quote Today The 30 year mortgage fixed rate mortgage declined a bit this week from the high of 4.56 percent seen last Thursday, the day following the Fed statement. This week, the rate declined a bit from Friday's closing figure of 4.53 and has held steady at 4.51, with only sideward movement. There are a few events this week that might affect rates. On Wednesday the Treasury will auction 5-year notes, and on Thursday it will be auctioning off 7-year notes. Demand for U.S.-backed debt is generally good for the mortgage rates, so if the auction results are strong, there might be a slight decline in rates toward the end of the week. Check to Get the Your Competitive Rate Quote Today Although the rise in rates of almost .125 of a percentage point last week may seem like a disadvantage to buyers, it is important to consider that the busy real estate season is approaching and that even a small additional rate increase, combined with greater demand for housing, will boost the cost of home ownership considerably. Especially if rates drop slightly by the end of the week, now could be a good time to lock your mortgage rate.

March 10th 2014

  Following last Friday's release of a stronger-than-expected Employment Situation report -- the most important gauge of the nation's economic health --  the Utah mortgage rates immediately rose to their highest level in 2 months.  Although rates rebounded slightly by the end of the day, last week was overall the worst for mortgage rates since August, 2013, with rates reaching levels not seen since January 15. Get a Free Utah Mortgage Rate Quote Treasury Rates were also influenced negatively by good news on the job front.  The interest rate on the 10-year Treasury note closed 5.5 basis points higher at the end of the week, at 2.790%.  The 10-year note interest rate for the week as a whole rose 13 basis points, which represents the largest weekly gain since early December. The Federal Reserve will hold their next policy meeting on March 18-19 to determine whether it should continue to scale-back the central bank's bond-buying stimulus. Get Today's Salt Lake Rates Customized for You The Employment Situation Report contained an interesting piece of data concerning the effect of winter weather on the job market.  On average, 70,000 workers lost a full week of work in February due to inclement weather, but this year the figure was 120,000.  One way to interpret that data is to argue that the payroll prints, which have declined significantly in the last few months, would have been stronger were it not for the severe weather. However, some analysts feel that there may be another element of volatility that is affecting the lag in payroll creation.  If payroll creation remains at its current average even once the weather improves, it will be good news for those who want mortgage rates to remain low.  Right now it is a waiting game. Call 888-425-9035 to get a free customized rate quote. Many mortgage analysts predict that rates could move still higher by the end of the week.  The advice for those floating Utah mortgage rates in anticipation of a quick closing is to lock your rate soon.  Source: http://www.mortgagenewsdaily.com/consumer_rates/347735.aspx; http://www.mortgagenewsdaily.com/mortgage_rates/blog/347607.aspx; http://www.marketwatch.com/story/10-year-treasury-yield-highest-since-january-2014-03-07  

March 3rd 2014

Over the last week of February, mortgage bonds that serves as a benchmark for many mortgages have gone up in value, slightly lowering Utah mortgage rates. Get a Free Rate Quote Based on daily treasury yield curves from the U.S. Treasury Department, the 10-year Treasury closed last week at a yield of 2.73 percent, down from the monthly high of 2.80 percent set on February 12. While the treasury's yield ticked upwards during the beginning of the week, by the end of the week, bond values surged, dropping its yield to a much lower 2.66 percent. This correlates to lower mortgage rates by about 0.125% lower in rate. The current yield represents a three week low for the benchmark bond. Much of the increase in its value comes from traders and investors that are seeking safety in the aftermath of the political tension in the Ukraine. The fear caused by the unrest related to disputes with Russia over the Crimea, balanced out good economic news in the Midwest, growing interest in home buying and positive measures of consumer confidence. Get Today's Rates Customized for you While the economic recovery remains weak, global signs remain positive. All of this points to ongoing support for the Federal Reserve's tapering policy. As the Fed continues to taper bond buying, the next step is to allow interest rates to gradually return closer to historical norms. Higher interest rates will impact the cost of borrowing across the board, making everything from car loans to residential and commercial real estate loans more expensive. While this week's fluctuations in mortgage rates were largely due to external forces, they remain a reminder that the market is ready to move yields around. Given the pressure from the Federal Reserve, it is likely that utah mortgage rates will continue to whipsaw in an overall upward direction for the foreseeable future, making it risky and potentially expensive to wait to take out new financing. Call 888-425-9035 to get a free customized rate quote. We recommend cautiously floating, but being ready to lock in at a moments notice. Sources: http://www.bloomberg.com/news/2014-02-28/treasuries-drop-as-euro-area-inflation-beats-economist-forecasts.html           http://www.treasury.gov/resource-center/data-chart-center/interest-rates/Pages/TextView.aspx?data=yield            http://www.cnbc.com/id/101456776

Weekly Update on Mortgage Rates and 3 Things You Need to Understand

mortgage ratesAlthough mortgage rates started out yesterday (Feb 19) a bit lower than they did the day before, this didn't last for long.  In fact, by yesterday at mid-morning, bond markets were already losing ground.  Because of this, lenders began issuing negative reprices.  All in all, this week's mortgage rates are causing home buyers to look at higher closing costs if they don't lock in over the next couple of days.  The best borrowing rate as of right now is generally being issued at 4.375%, and this is for a 30-year fixed loan.  There has been no detectable drama in this week's mortgage rates.  Because of this, there is no clear indicator as to how the future market for mortgage rates is going to go.   We've only seen two major moves in 2014, with the big move towards lower rates occurring in January, and then back up to higher rates last week.  Because there has been no major move this week, some market specialists are predicting there to be no major move for the next few weeks.  In fact, some experts are predicting no move will take place until the harsh winter weather conditions get behind us.  

Top 3 Things to Understand about Mortgage Rates

How to secure the best mortgage rate: The best mortgage rate comes at a time in which mortgage rates are low and you have a good credit score.  Most times, when mortgage rates are historically low, you will do best to secure a fixed rate mortgage loan because this will guarantee the low rate for the life of the loan. How mortgage rates affect the housing market: When mortgage rates are high, people tend to steer clear of buying homes.  When they are low, people of course flock to their nearest mortgage lender and apply like crazy for a loan.  Because mortgage rates tend to fluctuate on a daily basis, this means the housing market is affected from one day to the next as to whether or not people are interested in buying a home; however, when it is predicted that mortgage rates will stay somewhat low for an extended period of time, this is when the housing market booms. Things that affect mortgage rates: There are three main factors that affect mortgage rates: Type of loan, the Federal Reserve and your credit score.  Each factor plays its own part in the type of rates that you will qualify for; however, the two most influential are your credit score and the Federal Reserve.   If you would like more information on current mortgage rates, or info on securing a mortgage loan, please don't hesitate to contact Anthony VanDyke at ALV Mortgage today.