ABBA First Mortgage, Inc. - Wilmington, NC

Another rocky week

February 27th, 2015

The waves of interest rate volatility continued this past week.  What contributed to these ups and downs of the mortgage market place?  Was there any new specific data that one can point a finger at and say that it was all because of that?  No.  It was just more of the same global unrest (the European-Greece situation) and Janet Yellen of the Federal Reserve Board telling us that the Feds are inclined not to raise the short term interest rate until September of this year.  How investors reacted to this news is why we see the see saw movement of mortgage rates and cannot determine if rates are expected to go up or decline.  Stay posted while checking the rates through ABBA First Mortgage.

After 2 weeks of rates worsening…

February 24th, 2015

Many economists and mortgage gurus have this one thing in common- they use historical data and present day circumstances to predict what they believe the future holds for long term mortgage interest rates.  One such analyst predicted about 2 weeks ago that mortgage rates are poised to drop to (possibly) the lowest of the lows that this country has ever seen.  That rhetoric is what many representatives of the mortgage industry have been watching for.  However, this betterment is based upon a domino effect which includes, but is not limited to, global unrest, wars and rumors of war, improving oil prices, national strife, unemployment, housing starts, consumer sentiment, etc.  So we wait, but in the meantime, we see our rates have moved up slightly as we lost ~250 bps in the last couple of weeks.  Can rates improve?  I do believe that possibility exists.  Today is an indication of rates improving slightly.  With rates being amongst the lowest that this industry has ever seen in the last 60 years, I strongly suggest monitoring the rates with me, but locking in at a rate that you KNOW will be beneficial to you and your needs.  If they drop significantly, ABBA First offers a no-cost-to-you-refinance as part of our Loyalty Retention Program.  Call us for a quote as we hope to earn your business and your trust-for a lifetime!

Rates rising slowly

February 17th, 2015

The Markets

  • Fixed rates on home loans rose in the past week in the aftermath of the strong jobs report.
  • Freddie Mac announced that for the week ending February 12, 30-year fixed rates increased to 3.69% from 3.59% the week before.
  • The average for 15-year loans rose to 2.99%.
  • Adjustable rates were also higher, with the average for one-year ARMs up slightly to 2.42% and five-year ARMs increasing to 2.97%.
  • A year ago, 30-year fixed rates were at 4.28%, which continues to be more than 0.50% higher than today’s levels.
  • Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac — “Rates on home loans rose this week following strong economic data. The economy added 257,000 new jobs in January after robust increases of 329,000 in December and 423,000 in November. The unemployment rate edged up to 5.7 percent last month from 5.6 percent in December. Average hourly earnings rose 0.5 percent, following a 0.2 percent decline in December.”

Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Weekly initial jobless claims up over 300K

February 12th, 2015

The media has pointed out the fact that initial jobless claims have been down and this has a direct result on our economy.  True.  Plus lower prices at the gas pump and global unrest have also brought about the highest consumer confidence level in years.  Additionally, with mortgage rates continuing to hover just above the all time lows, ABBA First continues to lead the marketplace with the combination of the following- Low rates, low closing costs and exceptional service.  Although any lender can claim that- only a vey few can actually deliver these results to their clients continuously.  ABBA First can typically meet and/or beat any legitimate mortgage rate and terms based upon your circumstances.  Please give us a try.  We believe that you too will exclaim, just like “Mikey” – I like it!

Rate trends

February 10th, 2015

The Markets

  • Fixed rates on home loans fell in the past week, but the numbers were released before the strong jobs data report came out on Friday which changed everything.
  • Freddie Mac announced that for the week ending February 5, 30-year fixed rates decreased to 3.59% from 3.66% the week before. Today the ABBA First advertised rate is 3.75%.
  • The average for 15-year loans fell to 2.92%.
  • Adjustables were mixed, with the average for one-year adjustables up slightly to 2.39% and five-year falling to 2.82%.
  • A year ago, 30-year fixed rates were at 4.32%, which continues to be more than 0.50% higher than today’s levels.
  • Attributed to Frank Nothaft, vice president and chief economist, Freddie Mac — “Rates on home loans fell this week following the release of weaker than expected pending home sales, which fell 3.7 percent in December. Moreover, real GDP growth for the fourth quarter was 2.6 percent and the Institute for Supply Management reported slower growth in manufacturing last month, both missing market consensus forecasts.”

Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Based on what?

February 4th, 2015

Mortgage interest rates!  Why do they experience such swings up and down?  Why must the slightest economic news spook the investors of MBS (Mortgage Backed Securities)?  Is there an answer that is carte blanche and will cover all aspects of what affects the pricing of interest rates?  NO.  The global economy, world unrest, stocks, bonds, treasuries, oil, natural gas, to name a few, all lead to factors that may move interest rates up or down or not change rates at all.  With what we have seen lately, volatile pricing shows that interest rates have been affected by all of these.  The Federal Reserve has talked about raising the short term rates (which affect our prime rate presently at 3.25%) in the near future.  But let’s wait and see what they decide at the next FED meeting in February.  Until then keep an ear open to what is happening with regard to our markets, both nationally and world wide.  Our rates will change…based on the direction that these markets take.

1/26-Home buying: new or existing

January 27th, 2015

Buyers who purchase new homes are paying much more than those who buy existing homes. The price gap between the two types of homes, which historically has been in the 15 percent to 20 percent range, has ballooned to between 30 percent and 40 percent in recent years, according to data from the National Association of Realtors®. “That suggests either existing-home prices are much cheaper in relation to the newly built homes and/or that there is just not enough new homes being produced,” notes NAR Chief Economist Lawrence Yun on NAR’s Economists’ Outlook blog. In November, the median home price of a new home was $280,900. In comparison, the median price of an existing home was $206,200, representing a gap of 36 percent. New-home construction has been at low levels the last few years. Single-family housing starts this year reached 650,000, but a more normal rate for the sector is considered to be 1 million. A shortage of new-home construction is putting higher premiums on new homes, Yun notes. “Persistent underproduction of new homes is one key reason for pushing up prices,” Yun writes on NAR’s blog. “From 2004 to 2014, the price of a typical newly constructed home will have risen by 27 percent.” The price premium could widen more if housing starts do not rebound soon. NAR projects single-family housing starts to rise to 820,000 in 2015, which is still under the historical average. Source: NAR

 

1/22- Rates unchanged this morning from our improved rates of yesterday.

January 22nd, 2015

Initial Jobless Claims was 307K vs est 300K; this is the second straight week of above 300K But this is taking a back seat to the European Central Bank. Mortgage Backed Securities are selling off (-33BPS) as the ECB leaves their rates unchanged and no QE announcement yet.

Heard yesterday one analyst saying interest rates will increase this year; I don’t argue that only because of the present very low rates but we see little ahead that will drive rates much higher. Rates should remain low this year, at least through the first half of the year. Central banks are impotent now and cannot muster anything that will hike the low inflation levels that are major drags on the bullish outlooks. The Fed after three years of stimulus failed to increase the level of inflation to the 2.0% target; why would anyone believe the ECBs stimulus? Not likely but the ECB had to do something.

Volatility is alive and well this morning with the 10 year treasury bond in a 10 basis point rate range, the stock indexes opened better but turned negative fifteen minutes into the day. MBS prices also in wide trading range so keep tuned in.  Better yet, call me at 866-676-3349 or email richsr@abbafirst.com for the latest in mortgage interest rates and how they are being effected by the national and global economies.

1/21- Low Rates = More jobs!

January 21st, 2015

American homeowners are quickly fulfilling their New Year’s Resolution to refinance their home loans. Residential finance applications rose nearly 50% in one week in January, the strongest weekly gain since November 2008, according to the Mortgage Bankers Association, which tracks housing market data. It’s a closely watched metric because applications are a key indicator of not just the real estate market, but the overall U.S. economy, says Diane Swonk, chief economist at Mesirow Financial.

“We’re looking for housing to come back this year,” Swonk says. “There’s no other single change in the economy other than home buying that has such a large effect on spending.” Rates are at their lowest levels since May 2013. Many homeowners rushed to refinance at these rates. People refinancing their home loans made up over two-thirds of the application surge, the MBA reported. In addition, the President announced that the Federal Housing Administration is lowering their mortgage insurance fees.

The low rates are also creating more jobs. Home-building employment increased 7% in December from a year ago. Looking ahead, Swonk sees 2015 as the year that many Millennials, long stuck with poor job prospects, will become home buyers. “We are at a tipping point where we’re finally going to see some of those Millennials leave their parents’ homes, grow some wings and leave the nest,” Swonk says. “They’ll either rent or buy, but the arbitrage is really to buy.”

 

1/16- Positive consumer confidence level causes rates to rise!

January 16th, 2015

With oil prices dropping, we have seen and were hoping to continue to see rates do the same.  But, lower prices at the pump have caused consumers to have more confidence in our economy.  This positive attitude in turn has caused an about face and we are watching rates to go up today- fast.  The improvements that we saw this past week were wiped out in one day.  Do not allow your rate to get away from you!  Lock in at your earliest convenience with our discounted rates through ABBA First Mortgage.  We look forward to doing business with you and for you!

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