Archive for the ‘Rate Watch’ 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.


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.




2014 Interest Rate and Real Estate Market Forecast

As we begin a new calendar year, I have been thinking about what we can expect in 2014 with respect to both the residential real estate market in the tri-state area as well as the interest rate environment which has such a large effect on the market itself.

I will address the interest rate prospects first which look to me to be a bit like the gasoline prices we have seen for the past few years. With gas prices, we have seen a range from the low $3s (when we hope that they will fall into the $2s) to the high $3s (when we fear that they will rise into the $4s). Every few months we see seasonal adjustments increasing or decreasing the cost of a gallon of gas by .25-.75 but we never (or rarely) see prices break from that trading range.

I see the same thing for interest rates for most if not all of 2014. In good “rate” times (which will correspond with poor economic news or international issues), we may get close again to 4% on the benchmark 30 year fixed, conforming rate loan. While in bad “rate” times (which will correspond with positive economic news or relative calm in the world) we may get close to 5%.

However unless there are significant improvements in the job market and/or inflationary signals, I do not see the bull run of the stock market foreshadowing a huge upward trend in the interest rates. I expect to see rates in the 4s throughout most of 2014 with a possible break-through into the low 5s if the spring/summer home buying season and the fall holiday shopping season are both exceptionally strong.

As for the residential real estate market, I think that it is getting much better each month and that it is possible that 2014 will see us return to a near “normal” market. Outside of Manhattan and parts of Brooklyn, which have been remarkably strong and apparently resistant to the vagrancies of the mortgage lending environment (mostly due to the apparently unlimited supply of foreigners and cash buyers who have an extra $1M-$5M available to spend on apartments that they do not otherwise need to use), I do not see a consistent “bull run” on real estate region-wise.
That said, there will be pockets of “white hot” areas. And well-priced properties will move quickly and attract multiple bids. But, for the most part, the supply of buyers will be somewhat reduced by the new mortgage regulations that went into effect on January 10th (and additional ones that will go into effect a bit later this year). Those who had the audacity to hope that change in the regulatory environment would come along will likely end the year feeling blue. These new requirements mandate additional documentation and impose more stringent debt to income limits on the amount of money that can be lent. The net result of these new mortgage regulations when coupled with the other regulations from the past 4 years, will be a safer lending environment.

But, in line with “no good deed goes unpunished” it will be an environment with less people able to borrow money to purchase a home. I think that the combination of these requirements along with the high jobless/underemployment numbers will prevent the real estate market from becoming overheated in most areas. I think that these brakes being put on to the recovery of the real estate market are clearly an unintended consequence of the insatiable appetite of the federal government to close, lock, block, and bolt the “door after the horses have left the barn.” Nevertheless, it may actually end up resulting in a very positive outcome for real estate. Overall, this year will be another step toward the return to a normalization of the real estate market in 2014. But, we will not quite get there just yet!

So, those are my thoughts on the mortgage rates and the real estate market. And, much like the definition of an economist, I will tell you next year why the predictions I made this year did not happen!

I welcome any and all thoughts and comments. I wish you a very prosperous year and hope that you flourish professionally and personally in 2014.

LOOK OUT BELOW….Interest Rates Fall to Historic Levels



             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!


1373 Broad Street, Suite 312

Clifton,New Jersey07013

(973) 574-0900


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.

URGENT-Loan Amounts of $625,500-$729,250 Must Be Refinanced by September 30th for Best Pricing!

Since 2008, Fannie Mae and Freddie Mac have made loans available in amounts over the standard conforming (i.e. non-jumbo) lending loan limit of $417,000.  These loans, which are in amounts of $417,000-$729,250 are known as either High Balance Loans or Jumbo Conforming Loans.  These loans were  designed to fill part of the gap in the lower end of the Jumbo loan market that disappeared in 2008 with the collapse of the secondary  market. 

However, the original limits of these High Balance loans was only $625,500. There was a “temporary” 1 year increase of the loan limits to $729,250.  This temporary increase, which was extended year-by-year, is set to expire on September 30, 2011.  The conventional wisdom now is that the loan limits will not be increased again to $729,250.   Therefore, all loan amounts over $625,500 will be considered non-conforming or jumbo loans as of September 30th. This mostly affects 30 year, 15 year and 20 year fixed rate loans since many ARMs are portfolio products (i.e. not sold to Fannie or Freddie) and have consistent pricing up to $1M and sometimes higher.

As such, if anybody has a fixed rate loan in an amount of $625,500-$729,500 and was considering refinancing, you must do so immediately. And, by immediately, I mean this week or next week since the loan must close by September 30, 2011.    Wells Fargo has already announced that it will only honor registrations for this higher loan amount if they are in their system by the end of business on August 15, 2011.  There is a very small window of opportunity left to refinance these loans amounts, and I strongly suggest people take advantage of it before it closes!



With the huge decline in the stock market the past two weeks (and especially the past few days), the bond market has rallied causing a drop in interests rates.  If you missed the last refinance opportunity in the Fall of 2010, there is another chance now.  But, since nobody knows how long this will last, I suggest that anyone considering this contact your mortgage company as soon as possible.  As of the closing of the markets today, 30 year fixed rate loans up to $417,000 are as low as 4.25%; 15 year fixed rate loans are 3.5% and 5/1 ARMs are 3.125%. Rates on loans between $417,000 and $729,000 are not much higher.

Rates Are Up. Still good for purchases and refinances for cash or ARMs to Fixed

30 year-4.875% up to $417k

30 year-5.0% up to $729k

30 year-5.25% -$1M

15 year-4.375% up to $417k

15 year-4.50% up to $729k

5/1 ARM-3.75% (up to $417K)

5/1 ARM-4.0% up to $1.0M

7/1 ARM-4.375% up to $800K

7/1 ARM-4.5% up to $1.5M

10/1  ARM-4.625% up to $1M

All rates are for 45 days with 0 points and made by third party providers.  They assume credit scores of 740 and use of property as a primary residence.  Some products have loan-to-values limited to 60 or 70% (but not the conforming fixed rate loans). All loans are arranged by FCMC Mortgage Corp. a registered/licensed mortgage broker with the NYS and NJ Departments of Banking but made by third parties lenders.