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!