ABBA First Mortgage News

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Finally- rates did NOT increase this past week and the market saw a little reprieve.

Tuesday, October 23rd, 2018

While rates saw a slight improvement, ABBA First still has the lead in overall low rates.  Call 910-332-0650 and get the rate that you want and deserve just by asking and being approved for that rate and term.  We WANT to meet your mortgage needs and desires!

Rates fell back in the past week after several increases which brought rates to levels not seen for several years.  For the week ending October 18, Freddie Mac announced that 30-year fixed rates decreased to 4.85% from 4.90% the week before.  The average for 15-year loans fell to 4.26% and the average for five-year adjustables increased to 4.10%.  A year ago, 30-year fixed rates averaged 3.88%, close to one percent lower than today.  Attributed to Sam Khater, Chief Economist, Freddie Mac — “The modest decline in rates on home loans is a welcome respite from the rapid increase in rates the last few weeks.  While the housing market has clearly softened in reaction to the rise in interest rates, the economy and consumer sentiment remain very robust and that will sustain purchase demand, particularly in affordable markets and neighborhoods.”

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

Rates up to highest in 7 years but ABBA First is towing the line (and the Feds might too!)

Monday, October 22nd, 2018

Last Week in Review: 
Rates hit seven-year highs midweek on the heels of a confusing Fed message.

Market_Trends_2018-10-22

Our Federal Reserve has a dual mandate – to maintain price stability (inflation) and maximum employment. They also have a 3rd “unstated” mandate, which is to maintain market calm.

This past week, the Fed came up a bit short on that “unstated” mandate and created quite a bit of confusion and market turmoil midweek upon releasing the Minutes from the Sept 26th Fed meeting.

In that meeting we learned there is a group of “hawkish” Fed Members that want to hike the Fed Funds Rate more aggressively into 2019. At the same time, there were other Fed members who think the current Fed Funds Rates is “about right” – meaning no more hikes for now. The Fed talking out of both sides of their mouth was a source of confusion for the markets and home loan rates.

Adding to the confusion is the Fed’s very own inflation forecast which suggests inflation will remain close to current levels through 2021. If we recall the Fed mandate to maintain price stability, one could argue there is no need to raise the Fed Funds Rate if inflation is not rising.

Food for thought – If the Fed’s modest inflation forecast comes to pass, we will likely see home loan rates remain near historically attractive levels.

To our clients for advertising improperly due to a clerical/posting mistake

Tuesday, October 16th, 2018

It had come to our attention that due to an error between the rates that we advertise and how the rate is posted online after calculations, that there was an error in the final tabulation.  It has been corrected and going forward, the rates page and the advertised rates on our advertised websites have been corrected.  We apologize to those of you that saw a rate and/or a term that was advertised this past weekend that was sadly too good to be true.  If you would like, I am willing to offer you better than market rates if you were one of those that were affected and had made yourself known to us this past Monday or Tuesday.

ABBA First 30 year rate at 4.75%- National 30 year interest rate over 5% with a half point charged to you

Friday, October 12th, 2018

Where are the shoppers that want the lowest rate with the least amount of fees to obtain that rate? They should be looking right here at ABBA First Mortgage where if you qualify, the rates are lower than the national average and the service is twice as good!  Call 910-332-0650 and take advantage of the distinct advantage that you can only find at   www.ABBAFirst.com

The volume of applications for mortgages dropped during the week ending Oct. 5 as average contract interest rates rose to record levels, according to the Weekly Mortgage Applications Survey released by the Mortgage Bankers Association (MBA).

The average contract interest rate for all mortgage types increased during the period. The 30-year fixed-rate mortgage with conforming loan balances averaged 5.05%, its highest level since February 2011, up from 4.96%, with points increasing to 0.51 from 0.49. The average for the 30-year fixed-rate mortgages with jumbo loan balances increased to its highest level since July 2011, 4.99%, from 4.93%, with points increasing to 0.35 from 0.31.

Rates for 30-year fixed-rate mortgages backed by the FHA increased to its highest level since April 2011, 4.98%, from 4.95%, with points decreasing to 0.63 from 0.80. The average for 15-year fixed-rate mortgages increased to its highest level since April 2010, 4.44%, from 4.39%, with points increasing to 0.58 from 0.50. The 5/1 ARM averaged 4.29%, its highest level since the series began in 2011, up from 4.24%, with points increasing to 0.52 from 0.48.

 

Last week interest rates were one tick down after many ticks up with many more ticks up predicted

Wednesday, October 10th, 2018

Rates were steady in the past week; however, they started rising again towards the end of the survey period.  For the week ending October 4, Freddie Mac announced that 30-year fixed rates decreased slightly to 4.71% from 4.72% the week before.  The average for 15-year loans was also down one tick to 4.15% and the average for five-year adjustables increased to 4.01%.  A year ago, 30-year fixed rates averaged 3.85%.  Attributed to Sam Khater, Chief Economist, Freddie Mac — “Rates on home loans inched back a little in this week’s survey, easing one basis point to 4.71 percent after hitting a seven-year high last week.  There is upside risk with regard to rates as the economy remains very robust and this is reflected in the very recent strength in the fixed income and equities markets.  However, the strength in the economy has failed to translate to gains in the housing market as higher rates have contributed to the decrease in home purchase applications, which are down from a year ago.  With interest rates expected to track higher, it’s going to be a challenge for the housing market to regain momentum.”

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

With rates on the rise, NOW is the time to buy!

Tuesday, October 9th, 2018

ABBA First Mortgage will work with you to make that happen!  With our wide assortment of financing programs and several lenders in the wholesale market that we have a relationship with, the opportunity to obtain a mortgage through us could never be better.  If you have excellent credit, we will reward you for having obtained that status by reducing your rate and offering you lower points than the average market client.  Should you be struggling with your your credit scores and/or have lower than average market scores, you’ve come to the right place as well as we work with you to either obtain a mortgage immediately or work to build up your credit quickly to be able to obtain the right credit score to be able to move forward with your desires of home ownership.

We are here for you!  Call and find out how we can meet your needs.  Want a lower rate than advertised?  Call me at 910-332-0650 and ask for the owner of ABBA First Mortgage- Richard Biagini.  Let’s see if I can put something together for both of us that will create the right loan for you and have you smiling while you close your loan through my company.

CLOSED THIS SATURDAY-OCTOBER 6th

Friday, October 5th, 2018

Due to a fundraiser for our favorite charity that we sponsor as a company and support monthly, Operation Pretty Things*, the ABBA First office will be closed from 3PM on Friday Oct 5th and will not reopen until Monday Oct 8th.

*www.operationprettythings.org

Operation Pretty Things

is dedicated to LOVING and EMPOWERING women victimized by domestic violence.  Please see the full scope of how this wonderful non-profit organization comes alongside victimized women and gives them HOPE for a brighter future by clicking on the link above.

 

Buyers- BUY NOW! Rates are going up, NOT to come back down anytime soon!

Thursday, October 4th, 2018

We see buyers still waiting for rates to possibly go lower.  That’s not going to happen according to all data that’s being gathered and calculated as part of the future of mortgage interest rate predictions.

“The rise in mortgage rates this summer to their highest level in seven years has made it more difficult for potential buyers to afford a home,” said Dr. Frank Nothaft, chief economist for CoreLogic. “The slackening in demand is reflected in the slowing of national appreciation, as illustrated in the CoreLogic Home Price Index. National appreciation in August was the slowest in nearly two years, and we expect appreciation to slow further in the coming year.”

ABBA First Mortgage like to offer clients a dscount for using our company to obtain their interest rate NOW rather than wait until such a time that it is past the time of being as beneficial for your needs as it is today.

Sellers still playing the waiting game
Although the national figures suggest cooling, most markets continue to see prices rising and that’s leading potential sellers to wait for higher returns.

CoreLogic’s data shows that among the top 50 markets based on housing stock, 46% were overvalued, 12% were undervalued and 42% were at value.

“In some markets, homebuyers and sellers are remaining cautious and taking a pause as price appreciation continues to rise,” said Frank Martell, president and CEO of CoreLogic. “By waiting to sell, homeowners believe they will get the greatest return on their investment; the more money they have for a down payment, the easier the purchase payments will be for their next home.”

Rates move higher. Call for unadvertised specials!

Tuesday, October 2nd, 2018
ABBA First recognizes that for many people, mortgage interest rates seem to be very high as the 30 year national average has reached 4.75%.  However, for those of us who purchased homes in the late 1970’s or early 1980’s, having a mortgage rate less than 10.99% was awesome!  It’s all relevant!  While rates are still amongst the lowest in recorded mortgage history, may I suggest that you take advantage of the even lower rates that ABBA First Mortgage offers than the national average by calling 910-332-0650 and asking for the owner, Rich Biagini, and our unadvertised specials!

Rates moved to their highest level of the year in anticipation of the Federal Reserve hiking short-term rates. For the week ending September 27, Freddie Mac announced that 30-year fixed rates increased to 4.72% from 4.65% the week before. The average for 15-year loans rose to 4.16% and the average for five-year adjustables increased to 3.97%. A year ago, 30-year fixed rates averaged 3.83%. Attributed to Sam Khater, Chief Economist, Freddie Mac –“The robust economy, rising Treasury yields and the anticipation of more short-term rate hikes caused rates on home loans to move up. Even with these higher borrowing costs, it’s encouraging to see that prospective buyers appear to be having a little more success. With inventory constraints and home prices starting to ease, purchase applications have now trended higher on an annual basis for six straight weeks. Consumer confidence is at an 18-year high, and job gains are holding steady. These two factors should keep demand up in coming months, but at the same time, home shoppers will likely deal with even higher interest rates.

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

 

Downpayments rise with stiff competition for homes

Friday, September 28th, 2018

*Please call ABBA First Mortgage to find out details on how you can be qualified for a mortgage based upon your financials and credit score. 910-332-0650

With homes for sale in short supply, it’s been tough out there for would-be homebuyers competing against multiple other buyers. To sweeten offers and beat the competition, homebuyers have been shelling out some of the largest downpayments in years, tracking data suggests.

The U.S. median downpayment in the second quarter was $19,900, a record high and up 18 percent compared to the same quarter in 2017, according to Attom Data Solutions.

The downpayment amount will naturally tend to go up as home prices rise, but it also is rising as a percentage of the overall sales price, according to Attom Data Solutions.

In the second quarter, the median downpayment represented 7.6 percent of the median sales price, a nearly 15-year high and up from 6.6 percent a year earlier.

Attom Data Senior Vice President Daren Blomquist said this reflects the present realities for buyers.

“Despite some signs of cooling off, the housing market continues to be extremely competitive,” Blomquist said. “Buyers with higher down payments are better-positioned to qualify for loans and therefore win out in multiple-offer situations.”

Blomquist also said that while credit standards are loosening, lenders are requiring “more skin in the game” in return for taking on riskier borrowers.

“A lender might qualify a lower-credit, higher debt-to-income ratio borrower if that borrower is able to provide a higher downpayment,*” he said.

Other tracking data provides a mixed message on downpayments, though.

Surveys from the National Association of Realtors (NAR) suggests that fewer homebuyers are making very small downpayments, but also fewer are making large downpayments.

NAR reported that 58 percent of first-time homebuyers in August made a downpayment of less than 6 percent of the sales price. That ticked up a bit from July, but is down from a recent-era high-water mark of 68 percent, and has generally declined since 2011.

On the other hand, the survey also found that fewer homebuyers — first-time homebuyers and buyers of all types — are making downpayments of more than 20 percent. The percentage of all buyers putting down at least 20 percent was down to 51 percent in August, falling from a high-water mark of 63 percent in early 2012.

“In general, rising prices force borrowers to use smaller downpayments,” said Ken Fears, NAR’s senior policy representative. However, he also noted a larger downpayment signals to a seller’s agent that the buyer is more prepared to close on a deal. And some buyers have also been putting more down to reduce their monthly payments and interest, especially as rates rise.

“In an environment of strong competition for few houses, the potential buyers with larger downpayments and better credit profiles are likely winning and have been for some time,” Fears said.

According to the American Enterprise Institute (AEI), loan-to-value ratios (LTVs) have been stable for the past five years. The median LTV was 95 percent in June, which was unchanged from the June 2017 rate. This implies that at least half the borrowers of loans guaranteed by the government agencies or Fannie Mae/Freddie Mac put 5 percent or less down.

The average LTV has also been stable for several years at 89 percent, according to AEI’s data, which is based on the actual reported loan data. AEI’s figures refer to loans on primary homes, and exclude investors and second homes.

Ed Pinto, co-director of AEI’s Center for Housing Markets and Finance, said LTVs have already maxed out, and have nowhere to go.

“It is already so high,” Pinto said. “The median is 95, so half the people have less than 5 percent. It can’t go much higher.”

Pinto said while downpayments have been stable, borrowers have been bidding up properties. That has increased their debt loads on mortgages. The average debt-to-income (DTI) ratio has jumped 1.4 percentage points, to 39.9 percent, over the 12 months through this past June.

“That is a significant increase,” Pinto said.

(Excerpts of article from Scotsman Guide-a leading resource magazine for mortgage originators)

*Please call ABBA First Mortgage to find out details on how you can be qualified for a mortgage based upon your financials and credit score. 910-332-0650