Happy New Year to all!  ABBA First Mortgage is continuing to monitor the new legislation that is affecting everyone in the mortgage industry- especially our clients and prospective clients. The parameters of lending are constantly changing, but we still allow our borrowers to obtain the lowest rates and closing costs advertised in the industry.  As an example of the changing marketplace, some borrowers were fortunate to lock a 30-year fixed mortgage rate sometime during the last week in November.  Very fortunate!.  They were probably able to obtain a rate of 4.875% without having to pay high points or origination fees.  Contrast that with December 1st, the mortgage market turned into an extremely volatile time with rates worsening considerably. During the month of December ‘09, mortgage pricing deteriorated by nearly 3 points.  On December 1st, one could lock a 30-year fixed rate loan with 0 points and a 1% origination fee at 4.75%.  On December 31st, the same rate of 4.75% came at a cost of nearly 3 points.  Having to pay that many points to get the exact same rate 30 days later, is huge.  Not a pleasant situation for one to be in!

What was it that caused rates to worsen so drastically?  That is a question debated by many mortgage insiders and no one knows the answer with any degree of certainty.  There were signs that the housing market was improving coupled with a steady trend of fewer jobless claims.  That is great news for America!  But was that enough of an indicator that we, as a nation, were showing a stronger economy?  I don’t think so.  Although rates have worsened since the lows of ‘09, the new year has been showing that rates may slightly improve!

So, without predicting the future of rates I would like to make a suggestion.  Don’t give up!  Instead, let’s persevere together.  Our objective will be to know when to pull the trigger as we avoid the pitfall of rate deterioration, thereby moving away from your desired objective.  However, please remember that although you may qualify for a mortgage today, because of many circumstances beyond your control, you may not qualify for a loan tomorrow.  Lender guidelines, home values, job losses, and higher interest rates are some of the many key reasons why you may want to consider financing now before waiting to take advantage of the low rate environment that we are presently in.  This is where I may be able to point you in the right direction.

Please continue to follow the rates on our website and call me if you have any additional questions and/or desires as you move forward with ABBA First Mortgage.  You can even put your desired rate and term in to the Rate Tracker on our website and when the rate hits that point you will be notified by email.  What a great way to follow the market without having to be cognizant of every twist and turn that the mortgage industry may take!

We look forward to working with you and for you.  Thank you for considering ABBA First Mortgage, Inc. for all of your mortgage financing needs!

At ABBA First Mortgage, Inc. we are busy preparing for the upcoming mortgage rule changes in 2010.  Needless to say, many other mortgage professionals around the country are busy doing the same as well.  Our friend and colleague Rhonda Porter shared this poem today.  In the spirit of the season, I thought it was great and worth sharing with all of you too!

T’was the week before Christmas

When all through the lands,

LO’s and Closers were wringing their hands.

RESPA Changes are coming,

They all started to worry,

We’d better get trained, and trained in a hurry!

We all kept on hoping

There would be a delay.

But HUD said, “No Way,” it’s all here to stay.

“We love our new HUD

And our new GFE,

Don’t fret, don’t worry, it’s as simple as can be.”

We all shook our heads,

Threw our hands to the sky.

What were you smoking?  You must have been high!

You took a one page doc

And changed it to three.

Easier?  More simple?  How can that be?

The Regs don’t match up,

So now what do we do?

HUD says, “No comment, It’s all up to you.”

No info on TILA,

HMDA, REG B.

We are totally screwed, why can’t they see??

In a time when some borrowers

Think lenders are scary,

You’ve given 3 pages to make them more wary.

This doesn’t make sense,

Not one little bit.

We are all trying hard to not throw a fit.

So we all do our best

To put borrowers at ease.

But make more reform, please, please, please!

Please bring someone in

Who knows what to do.

What is best for both borrowers AND lenders too.

We are all still waiting,

Though not holding our breath

And hoping the government doesn’t “Reg” us to death.

So on this week before Christmas,

I’d like to wish you

Good luck with RESPA, I need it too!

A special thank you to Rhonda Porter at The Mortgage Porter for her permission to re-post this!  If you are on Twitter, you can follow Rhonda by clicking here.

ABBA First Mortgage, Inc. would like to wish you a very Merry Christmas and Happy New Year.

Thank you for the opportunity to help you obtain your mortgage financing objectives this year.  The trust that you place in us every day is not something that we take for granted!  We look forward to serving all of your mortgage needs in 2010.

- The ABBA First Mortgage Team

Further government intervention may be coming to help struggling homeowners facing foreclosure.

WASHINGTON (MarketWatch) — With the nation’s jobless making up a major part of future home foreclosures, advocacy groups are meeting with top Obama administration officials to seek ways to help keep the growing wave of unemployed borrowers in their homes.

Groups are meeting with officials at the Treasury Department, Housing and Urban Development, and in the White House’s National Economic Council to have them take part of an existing $75 billion program to help homeowners modify mortgages and put it in a program that would help the jobless stay in their homes.

The program would go beyond a measure included in sweeping bank reform legislation that would use $3 billion in bank bailout dollars to give the jobless fixed-rate, low interest rate loans.

For more click here.

If we can do anything to help you stay in your home it would be our highest honor.  Please feel free to contact us at 866-676-3349 to discuss how we can save you money on your mortgage.

I always find these sorts of stories interesting- experts crunching data without any feel for the “man on the street”.

Based on credit performance of 27m consumers, national credit bureau TransUnion projects mortgage delinquencies of 60 or more days to drop nearly 3% by year-end 2010 to 6.39%, from an expected 6.56% at year-end 2009.

Recent years marked a series of “unprecedented” year-on-year increases, TransUnion said, with delinquencies rising in the the 11th straight quarter during Q309.

“Tied directly to anticipated unemployment rates and housing values, the decrease in delinquencies should be gradual…

Read more here.

I am not saying that we won’t see TransUnion’s findings come to fruition.  In fact, I earnestly hope that we will see mortgage delinquencies decline in 2010- that would be wonderful news for anyone that owns a home in our great country.  However, it seems like these sorts of findings are intended to rally the economy and not actually report on our current state.  I mean, they are simply speculating based on mathematical equations and probability.

I am not knocking TransUnion- I hope they are right.  But as you talk to your family, friends and neighbors do you get the feeling that things are really turning around?

“The U.S. housing market has been in a slump for the past four years. When will it ever end?

In recent years, real estate has proven as jittery and unreliable as any other market. The average U.S. home price nearly doubled between January 2000 and April 2006, according to the First American LoanPerformance index. Since then, the average has fallen about 30%. The drop has been 53% in the Las Vegas metropolitan area and 39% in Miami, where about a quarter of all households with mortgages are behind on their payments or in foreclosure. The value of your home might be determined more by whether the neighbors keep their jobs than whether the house has ample light and closet space.

Here is a guide to navigating a fractured and volatile market…”

To read more of this great article click here.

“While plenty of drivers affect the housing market, there may be none more important than how the Federal Reserve handles interest rates. All things being equal, the lower the interest rates charged by the Federal Reserve, the lower the mortgage rate you will be able to get when it comes time to buy (or refinance) your home.

Before we talk about what the Fed will do next, let’s step back to put everything in perspective…”  To read more of this insightful article from Business Week click here.

There is little doubt that rates are on their way up.  Remember, when rates start to climb all of the people that were watching the rates will try to get the process started at once.  When this happens, you can bet that we will see the banks raise the rates even more quickly to control the flow of new business.  We’ve seen this happen before.  Now may be the best time to get your application started so that you can be in front of the line when rates start to climb.  Please contact us at 866-676-3349 to discuss the next steps or complete our online mortgage application.

With a slew of economic news raising hope during the past couple of months, Federal Reserve Chairman, Ben Bernanke, boldly claimed that the “recession is very likely over.” After an enduring time lapse, both stocks and bonds rallied in tandem with the Dow Jones Industrial Average (DJIA) inching closer to the magical 10,000 level, while the 10-year Treasury rate continued its downward descent to 3.40 percent. On the banking front, some bankers will be carefully observing the developments that will come out of Friday’s G-20 summit in Pittsburgh, particularly since leaders representing 20 countries have kept up the intense pressure for a deal to curb bankers’ pay and bonuses since the group’s last meeting in Europe…

With the signs of economic recovery becoming more evident by the day, some market participants have begun to wonder whether the FOMC might begin to withdraw market support in the coming months, either by winding down its remaining asset purchase programs more quickly, or perhaps moving to exceptionally low federal fund rate levels.. With growing evidence of progress toward stability in the financial and housing markets, the outlook for Fed policy now hinges more on traditional criteria: how strong will the incipient recovery be, and what does it mean for inflation? However, many experts believe that there is no need to make decisions on the agency debt or MBS purchase programs until at least the November meeting, since these programs are currently scheduled to run through the remainder of the year. This week’s statement should feature more upbeat language about the growth outlook. Meanwhile, the FOMC is expected to leave the fund rate target at 0.25 percent when it concludes its two- day meeting on Wednesday. Many expect that the jobless recovery pattern of the 1991-1992 and 2001- 2003 periods may be repeated with slow growth in 2010. This may prompt reticence on the FOMC’s part to raise the funds rate target from its near-zero current setting until such time confidence is restored and the unemployment rate reaches its cyclical peak.

Some economist feel that inflation is not a significant threat in the short term despite the highly expansionary fiscal and monetary policies in place, as these policies have been implemented to combat a large and growing gap between actual and potential output. Under any reasonable economic scenario, the aggregate U.S. output gap will be huge. The gap is currently about 8 percent of GDP and could potentially grow to as much as 10 percent, thus requiring years of above-trend growth to eliminate. Foreign investors are ramping up their purchase of Treasuries, betting that inflation will remain subdued. Investors outside of the U.S. bought 43.1 percent of the $1.41 trillion of notes and bonds sold by the Treasury Department this year, compared with 27.1 percent of the $527 billion issued at this point in time in 2008.

After a successful run for “cash for clunkers,” the US and other developed nations are aggressively pursuing the policy of “cash from bunkers.” Thousands of Americans must decide by September 23rd whether to disclose accounts to the IRS and possibly face back-taxes, fines and penalties, or keep their assets undeclared and risk criminal prosecution. The IRS reportedly has given tax evaders more time to disclose accounts i.e. until October 15th. Following a crackdown by the U.S. authorities, the Italian government launched its own investigation into as many as 170,000 “rich” residents suspected of sheltering billions of euros from taxes, largely through Swiss banking operations. Those taking advantage of the amnesty have until April 2010 to declare their foreign accounts and pay a one-time 5 percent penalty on the total. The estimated money hidden behind those safe “Swiss bunkers” may exceed trillions of dollars. Who knows, if all the “rich” countries could have gotten back part of these hidden moneys, we might have avoided all the taxpayer-sponsored bailouts and stimulus packages.

The week’s economic calendar includes the FOMC meeting on Tuesday and Wednesday and the G-20 meeting on Thursday. The market is more likely to be focused on any potential Fed discussion of an exit strategy from the liquidity measures that have been implemented over the last year. Economic reports of interest include Thursday’s Existing Home Sales and Friday’s Durable Goods Orders and New home sales. Meanwhile, enjoy the week ahead.

ABBA First Mortgage, Inc. is pleased to announce that we now offer Veterans Administration Home Loans or VA loans.

The VA loan was designed to offer long-term financing to American veterans or their surviving spouses (provided they do not remarry). The basic intention of the VA direct home loan program is to supply home financing to eligible veterans in areas where private financing is not generally available and to help veterans purchase properties with no down payment.

Some of the benefits of a VA loan include:

• 100% financing without private mortgage insurance.
• VA loans allow veterans to qualify for loans amounts larger than traditional Fannie Mae / conforming loans.
• VA will insure a mortgage where the monthly payment of the loan is up to 41% of the gross monthly income vs. 28% for a conforming loan assuming the veteran has no monthly bills.
• VA allows the seller to pay all of the veteran’s closing costs as long as the costs do not exceed 4% of the sales price of the home.
• The maximum VA loan amount with no down payment is $417,000 and can be as high as $625,500 in certain high cost areas.

We are thrilled to be able to bring our level unparalleled customer service to the brave men and women that have so selflessly served our country.  If you would like to take advantage of this program, please apply online right here on our website- be sure to complete the Full Online Application. Once we receive your application, one of our experienced loan officers will contact you to review the application and discuss the next steps.

Please feel free to contact us if you have any questions. Thank you for the opportunity to EARN your business and your trust- we do not take it for granted!

ABBA First Mortgage, Inc. will be closed on Monday, September 7th in observance of Labor Day. We will resume normal business hours on Tuesday, September 8th. We look forward to serving all of your mortgage needs… enjoy the holiday weekend!

“You can’t make this up,” New York appraiser Jonathan Miller riffed in his entertaining blog, Matrix, back in June.

Miller was recounting the frustration of a real estate salesperson who was trying to refinance her own New York apartment with her current lender. According to Miller’s telling, the out-of-town appraiser walked into the apartment, threw his hands in the air, and asked “How am I supposed to appraise this thing?”

That story sums up the feeling of many in the real estate industry toward the new Home Valuation Code of Conduct, a set of rules created to prevent those who stand to profit from a real estate transaction from putting undue pressure on the appraiser.

The rules, which went into effect May 1 for all conventional, single-family loans destined for sale to Fannie Mae or Freddie Mac, prohibit mortgage brokers and real estate brokers from ordering appraisals and require that lenders erect a firewall between loan production staff and the appraiser. Sounds reasonable. After all, the appraiser is there to assure that the lender’s funding decision is sound, right?

Since the rules took effect, however, they’ve set off a firestorm of protest around the country…”

To read more of this great article click here.