Archive for the ‘Market Report’ Category

BREAKING MORTGAGE NEWS-Rates to Plunge on Brexit!

Last night, the United Kingdom shocked the world by voting 52% to 48% to leave the European Union. Though their Prime Minister David Cameron campaigned hard against the withdrawal, the British people decided that it was in their best interest to do so. This vote is seen as an anti-immigrant one as the UK wants to limit access to its borders. As a result of the financial uncertainly this has caused, MORTGAGE RATES WILL BE PLUMMETING today and at least in the short term.

Brexit

So, what does this have to do with mortgages? Well, I am glad you asked! As the financial analysts and traders were blindsided by the result of the vote, the world stock markets are in turmoil. The British Pound is at a 30 year low v. the dollar and the Dow Jones is down 3% before the open. As a result, the yields on the 10 year US Treasury, which is one of the indexes that effects mortgage rates is down 22 points. That means that mortgage rates are going to open significantly lower today.

If you can act fast, there may be a unique opportunity to refinance and take advantage of what may be a significant “blip’ in the market. This could last for some time until the markets stabilize but there is no way to know. What I can predict with relative accuracy is that today, mortgage rates should be the lowest they have been for the year.

Contact me today and find out how you can save hundreds of dollars on your monthly payment by refinancing! Have a great weekend.

Regards,

Dan

Here’s a useful guide for your real estate investments in 2015.

A Better Outlook for the Home Mortgage Market in 2015

Millennial-Workforce

The real estate market in 2014, while better than the prior two years, was not an especially strong year as the market was hampered by stricter lending guidelines. The good news is that interest rates didn’t rise like many pundits predicted and are now actually at their low point for the year. Check the trends that are developing in 2015… (cont)

What effect will the cold, snowy winter have on the spring housing market?

Happy Valentine’s Day to All. And, what a fine intro that makes to this email on the cold, snowy winter and the spring housing market (see Reason 4 below for context).

So, here goes…I believe that due in a large part to this winter’s weather, the spring housing market will be extremely strong. The top 5 reasons (in no real order) are as follows:

1. After years of procrastinating due to both indecision and depressed housing prices, the “younger” senior citizens (i.e. those from 60-75 years old) will finally have had enough of the cold and snow. They will put their houses on the market in large numbers to either move to warmer climates or to maintenance free townhouses and apartments. No more large heating bills or snow shoveling for them!

2. After putting off buying a home for years due to lack of funds or the fear of another housing bubble, the Millenials, who have been living with their parents will having finally had enough of this togetherness after being cooped up too long in too little space during this winter. They will be ready to either buy an apartment, or depending on where they are looking to live, possibly a starter house.

3. Similarly, young married couples with either children or imminent plans for them, will realize that they cannot live much longer in the small apartments they either own or rent and will be ready to “trade-up” to a larger apartment or a house. Being cooped up in a small space with children (or even just a spouse) for long periods of time with too little to do, gets old fast!

4. We are in store for a huge, mini-baby boom in the Fall. As we all know, there are only 8-12 new episodes of Downton Abbey, Game of Thrones, Homeland, etc. and a limit on the number of re-runs of Seinfeld and Friends, you can watch. So, many of those Millenials, Generation X’s, etc. will likely be doing some “nesting” this winter. Therefore, by mid Spring (i.e. the second trimester), we should see a lot of motivated buyers looking for homes.

5. The cold winter has put a “damper” on the housing market outside of New York City. It is too cold to look for houses; impossible to see what the outside of the property looks like; and seller’s do not want lots of folks tramping through their homes with wet, muddy shoes. But, come March 1st or the first week of consistent 40+ degree weather, and the real estate agents’ phones will be ringing off the hook. People will be ready to put the cold weather behind them and engage in that other annual Spring rite of passage, buying a house!

With mortgage rates still in the low to mid 4s, and the above reasons indicating a strong spring housing market, I believe that this will be the best year since 2007 for buyers and sellers of residential real estate.

Mortgage Industry Update

I am pleased to announce that I, along with my co-owner and the staff of FCMC Mortgage Corp., have now joined Classic Mortgage LLC.   Classic Mortgage is a mortgage banker in New York, New Jersey and Connecticut.  At Classic, we will be able to offer the same excellent service; low lender interest rates and variety of brokered mortgage products as we did at FCMC Mortgage Corp.

However, in addition to brokering loans, since Classic Mortgage LLC, is a mortgage banker, Classic will make the loans themselves on many conforming, high balance conforming and FHA loans. As a mortgage banker, we will have more flexibility over the transactions. This will allow us to provide superior service to our clients with quicker approvals, better control over the loan process and easier closings. .

I would like to thank all of you who have allowed FCMC to serve your mortgage needs and those of your clients, friends and family since 1995.  It has been my pleasure to work with all of you.

I look forward to many more years of assisting with your mortgage financing needs. Please contact me any time with any mortgage related inquiries, questions or issues.

My new contact information is set forth below:

Dan Shlufman (MLO #6706): dshlufman@classicllc.com

CLASSIC MORTGAGE LLC.. MLS ID# 31149 25 E. Spring Valley Ave., Ste. 100 Maywood, New Jersey 07607 201-368-3140 (tel) 201-909-5839 (fax) www.classicmortgagellc.com

LOOK OUT BELOW….Interest Rates Fall to Historic Levels

NEWSFLASH!!

       DON’T BE LATE –BEAT THE RUSH AND REFINANCE NOW! 

             As you likely have heard, interest rates have now fallen to their lowest levels in decades!. You may want to consider refinancing your current fixed rate mortgage. If you have an ARM with a few years left on it,  you may want to convert into a fixed rate loan or just lower your monthly payments by taking out another ARM.    In addition, if you have a 30 year loan and want to save on interest expense by shortening the term, you may want to consider converting it into a 20 year or15 year fixed rate loan.  

                The mortgage market is a rocky place now with difficulty navigating the waters.  Working with a reputable broker will help you navigate these waters and provide you with an advocate for your loan.  Don’t go it alone.  

                 Also, on many of our loan products our lenders offer a float-down option.  So, if the rates go down further, before you close, we may be able to lower your rate as well.  Therefore, there is no need to wait and see where the rates go to before starting a refinance.  

                 As the NY lottery says, “You have to Be in It to Win It.”  So, be a winner and contact Dan as soon as possible!

FCMC MORTGAGE CORP.

1373 Broad Street, Suite 312

Clifton,New Jersey07013

(973) 574-0900

www.fcmc.net

WHO LET THEM LOW RATES OUT, WHO, WHO?

After all the bad news that has been coming out recently about the real estate market generally and the mortgage industry, specifically, I am here to finally report some good news.  Unbeknownst to most homeowners, interest rates on conforming/non-jumbo loans (i.e. loan amounts of $625,000.00 or less) have now fallen enough that we are firmly entrenched in a refinance market. 

 Interest rates on these loans are now available in the low 4s on 30 year fixed rate loans and the low 3s on 15 year fixed rate loans.  Due to the tightening in the lending markets, banks are requiring that borrowers have good credit (with scores at least in the mid 600s) and equity of 10% or more in their homes.   In addition, borrowers will need to be able to verify their income and employment to qualify for these rates.  However, there is a government program know as HARP (Homeowners Affordability Refinance Program) that allows for refinances even when houses have negative equity!

 For anybody who purchased a home recently and has a 30 year fixed rate interest rate of 4.75% or more, it will be worth exploring the possibility of refinancing. If the monthly savings on the new loan, due to the lower rate, are enough to repay the closing costs within 2 years, it is worth refinancing.

 Also, for someone who has an adjustable rate mortgage (i.e. an ARM) that will be resetting in the next year or two, this is the time to replace it with a fixed rate loan.  Since most of those ARMs have interest rates in the upper 2s or low 3s, the fixed rates are now low enough to replace them without incurring a significant increase in payment.

 Finally, there are many people who have large balances on their home equity lines of credit at interest rates that are tied to Prime.  As a result, it is worth considering refinancing to consolidate these lines of credit with a first mortgage to lower the rate and payment. 

 All loans arranged through FCMC Mortgage Corp.  a NY/NJ Registered/Licensed Mortgage Broker with State Banking Departments and made by Third Party Lenders. NMLS Number 6654.

5 Tips to Get the Best Deal on Your Refinance

1.   Apply NOW: Apply for your loan (i.e. forward paperwork to your broker/banker) in the next two weeks. If possible, do it this week.  Don’t wait to see if rates go lower because “the economy is terrible” and  your  ____________ (fill in the blank) “knows” they will.  Apply now and see below for a resolution of the potential lower rate problem.   You need to apply, because as the New York Lottery says, “You Need to Be In It To Win It.” And you are not in it until you start the refinance process even though you believe you are since you are “monitoring” rates.

2.  Lock at Application: Lock in your interest rate when you apply for the loan.   When you lock-in the rate, make sure that the rate lock is good for at least 60 days.  It is going to take this long to close your loan even if you it does not seem like is should!  Many brokers and internet sites entice you with lower rates but only offer a 30 day rate lock.  That has not been enough time to close for 2 years and is definitely not enough time to close now.  For example, as result of new regulations, an appraisal cannot even be ordered (let alone performed) for at least 5 days (and often for as many as 8 days) after an application has been submitted.  I want to reiterate that a 60 day lock is the minimum you need.  We lock all our borrowers now for 60 days and have for a long time. I would also ask about the cost of extending the rate beyond 60 days since you are possibly going to need a rate lock extension especially if anything unusual arises (which it almost always does now).

3.  Floatdown Option Request that the loan be locked with a bank that has a “floatdown” option.  That way, if rates go lower after you lock in your rate, you will be able to take advantage of it. But, if the rates don’t, you will not risk losing today’s low rates by gambling for a slightly lower rate in the near future.  Most lenders offer floatdowns now since they do not want to lose the loan by having the borrower go elsewhere for a lower rate.  We use lenders that offer this on 90% of the deals we close and on all of the refinances we have originated in the past month.  Note that floatdown policies differ with some lenders offering you their current rate (i.e. the lowest rate) if rates go down and others offering their current rate plus an additional amount to account for the cost of the funds.  These additional amounts are typically about .125% but can be as high as .375% above the banks’ current rate.

4.  Reputation is King: Use a reputable broker or banker (i.e. one who was referred to you by friend, family or professional).  I know that this is common sense, but maybe not so much anymore.   This is not the time to chase every last .125% by using an internet mortgage company or by getting the broker/banker to convince you to lock for 30 days because they can close in that time.  With the increased regulations, decreased staff and continually increasing underwriting turn-times, you want to make sure that you actually close on the interest rate you locked.  It does you no good to be locked at an interest rate and not be able to close on it.   Think of the old Seinfeld bit at the Chinese restaurant and the “reservation.”  Jerry and his friends could not eat at the restaurant, though they had made a reservation, since the restaurant had failed to “hold the reservation.”  Jerry then pointed out that the importance of a “reservation” was the “holding” of the reservation not the “making” of it since you cannot eat at the restaurant if the reservation was not held!   It is similar logic on interest rates where just “locking” the rate does you no good if you cannot “close” with that rate. 

5. Be Responsive:  If your broker or bank requests that you provide additional documentation, explanation letters, disclosures, etc., provide them as soon as you can.  Do this even if you cannot understand why they are needed or think the request is ridiculous (which it likely may be) .  Also, it does you no good to argue with the broker or the bank about these requests or point out to them that you “took out a loan a few years ago and did not have to provide these items”  NEWSFLASHWe know, the lenders’ know, and it doesn’t matter.  As they say in the securities industry, “past performance is no guarantee of future results.”   The past is the past. This is especially true in the mortgage business.  Since things take a long time anyway now, you don’t want to be the cause of any unnecessary delay on your refinance which may result in your rate lock expiring.  Moreover, if you respond timely to all requests and the delay in closing is mostly/solely as a result of bank delays, there is a good chance that the bank will extend your rate for a short time at their cost if you cannot close within the 60 day rate lock period.  But, if you don’t you will definitely need to pay for an extension.

Follow the above steps and you will likely be able to enjoy a successful refinance and save hundreds of dollars on your mortgage!