Friday, September 21, 2012

Mortgage Rates Fall Back to Record Lows

DAILY REAL ESTATE NEWS | FRIDAY, SEPTEMBER 21, 2012

Fixed-rate mortgages are back at all-time record lows or hovering near them, Freddie Mac reports in its weekly mortgage market survey. For those who can qualify for a loan, the ultra-low mortgage rates are pushing housing affordability higher.

"Following the Federal Reserve's announcement of a new bond purchase plan, yields on mortgage-backed securities fell, bringing average fixed mortgage rates to their all-time record lows, which should aid in the ongoing housing recovery,” says Frank Nothaft, Freddie Mac’s chief economist.

Here’s a closer look at the national averages with mortgage rates for the week ending Sept. 20:

30-year fixed-rate mortgages: averaged 3.49 percent, with an average 0.6 point, matching its all-time low. A year ago at this time, 30-year rates averaged 4.09 percent.
15-year fixed-rate mortgages: averaged 2.77 percent, with an average 0.6 point, setting a new record low this week. Last year at this time, 15-year rates averaged 3.29 percent.
5-year adjustable-rate mortgages: averaged 2.76 percent, with an average 0.6 point, rising from last week’s 2.72 percent average. Last year at this time, 5-year ARMs averaged 3.02 percent.
1-year ARMs: averaged 2.61 percent this week, with an average 0.4 point, holding the same as last week. A year ago, 1-year ARMs averaged 2.82 percent.

Source: Freddie Mac

Monday, September 17, 2012

'Mortgage Cops' Target Strategic Defaulters

DAILY REAL ESTATE NEWS | MONDAY, SEPTEMBER 17, 2012

The Office of the Inspector General at the Federal Housing Finance Agency is trying to find strategic defaulters and collect on what they still owe. Strategic defaulters are often underwater home owners who walk away from their mortgages even though they still have the means to pay.

Experian has estimated that 20 percent of all foreclosures are from startegic defaulters. The OIG estimates that strategic defaulters owe more than $1 billion to Fannie Mae and Freddie Mac, and they’re ready to start collecting.

The OIG is reportedly working with Fannie Mae and Freddie Mac to develop a mechanism for identifying strategic defaulters.

"Debts that haven't been repaid don't just go away," an unnamed Treasury Department official told The Chicago Tribune. "It doesn't matter whether it's on your credit report or not."

The OIG has an even harsher warning for strategic defaulters who have failed to disclose that they walked away from a previous loan on any new loan applications. The OIG says such walkaways have constituted mortgage fraud, and the OIG plans to refer them for criminal prosecution.

"We're not just going to demand repayment," says Heather Wolfe, OIG assistant inspector general for audits. "We're going to lock [people] up."

Source: “Mortgage Cops Taking Tough Stance,” The Chicago Tribune (Sept. 16, 2012)