ABBA First Mortgage News

Staying low as Feds meet Thursday-Friday to discuss future actions

August 21st, 2019

Rates hold steady as we have seen these lows for a second straight week.  last year, the 30 year fixed rate mortgage averaged 4.53% while this year it has been averaging 3.60%, nearly 1.0% less than it was a year ago.

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.

Current Indices for Adjustable Rate Mortgages 
Updated August 16, 2019

  Daily Value Monthly Value
  August 15 July
6-month Treasury Security 1.86% 2.08%
1-year Treasury Security 1.72% 1.96%
3-year Treasury Security 1.44% 1.80%
5-year Treasury Security 1.42% 1.83%
10-year Treasury Security 1.52% 2.06%
12-month LIBOR   2.189% (July)
12-month MTA   2.447% (July)
11th District Cost of Funds   1.141% (June)
Prime Rate   5.25% (July)

With lower interest rates, the economy is picking up and refinancing of existing homes is strong

August 14th, 2019

It was the week of the “Feds,” as not only did our Federal Reserve Board lower rates by .25% last week, but also other Central Banks around the world weighed in. The Bank of Japan and Bank of England both kept their already low interest rates steady, one week after the European Central Bank also made the same decision. These actions served as a reminder that our economy is linked to the world economy.

One reason cited for our Fed lowering rates was the slowdown in the world economy, which could very well spill over into our own economic situation. Thus far, our economy has been performing decently this year, but the second quarter was definitely slower than the first. The question is–will the Fed’s decision to lower rates bolster our economy? The answer to this question is more complex than it would seem.

Interest rates had already moved down significantly in anticipation of the Fed’s action. Since there was no surprise .50% cut, rates may not have moved much further unless the Fed was expected to act again. And there was no clear-cut signal on that issue which came from the Fed announcement. However, within 24 hours, the Administration announced new tariffs which caused more commotion in the bond and stock markets than the Fed activity. Either way, the lower rates which preceded the Fed’s move and followed the tariff announcement, seem to already be having some positive effects — especially within the housing sector where purchases are picking up and refinances are strong.

So what’s your credit score?

August 7th, 2019
Any score between 700 and 749 is typically deemed “good,” while scores from 650 to 700 are “fair.” Excellent scores are usually those over 750.

 

Call ABBA First Mortgage for help in improving your credit score.  Although we may be able to do mortgages down to a credit score of 500, you may find it much easier to be approved for a loan with a score of 620+ and we can help you get there as quickly as possible if you’re interested.  Call 910-332-0650 and ask to speak to Rich allowing him to explain the process to bring your scores up no matter what your present scores may be.  There’s always HOPE.  Please never give up!

So if you’re thinking about buying a house now or in the next few years, you might want to work on improving your credit score. The Federal Reserve reports that 90% of U.S. home loans taken out in the first quarter of 2019 were by home buyers with a score of at least 650, and 75% had a score higher than 700. The average credit score this year sits at 759, the report found, and only 10% of borrowers had scores under 647. FICO credit scores range from 300 to 850, and the national average is 704.

While you can likely qualify for a home loan with a rate lower than the median, a higher score typically means better interest rates and loan options. A multitude of other factors can also influence the approval process, including the cost of the home, the size of the down payment and your income. But the score is a significant factor. Remember, raising your score won’t happen overnight. Paying your bills on time and lowering credit usage are long-term habits that need to be built and cultivated. To improve your score, patience is key.  The other key is to call ABBA First Mortgage and let them get to work with you and for you with their highly trained credit consulting team that will speak with you about your credit report and discuss the next steps of bringing your dreams to a reality by working with you on your credit scores,  your credit history, and your future credit possibilities.

 

 

Feds reduced the bank rate by .25%- Now what?

August 1st, 2019

We’ve been waiting to see what the Federal Reserve Board would do at their monthly meeting under the direction of Board Chairman Jerome Powell.  Would they hold the bank rate steady?  Or reduce it slightly?  Or lower the rate by a half point which would be a true stimulus to the economy and trigger a mini re-fi boom?  The answer came yesterday as the Feds met and played it safe and for the first time in years lowered the internal rate that the banks use to “exchange” money between banks.  It also affected the short term rates for adjustable rate mortgages, HELOCs, and all short term credit such as credit cards.  The mortgage interest rates will also feel the effect of this rate lowering, but not to the extent that it may have if there was a larger decrease as was hoped for by many in the mortgage industry.  However, the interest rates are close to being the lowest that they’ve ever been in the history of mortgages and the suggestion is to take advantage of this opportunity while the getting is good.  Call ABBA First for the up to the minute rates available for you as the market is always moving and you may catch it at the bottom when you call!  We’re waiting to hear from you at 910-332-0650.

Once again rates are down

August 1st, 2019

For the week ending July 25, Freddie Mac announced that 30-year fixed rates moved down to 3.75% from 3.81% the week before. The average for 15-year loans decreased to 3.18% and the average for five-year ARMs moved down slightly to 3.47%. A year ago, 30-year fixed rates averaged 4.54%, more than 0.75% higher than today. “Rates continued to hover near three-year lows and purchase application demand has responded, rising steadily over the last two months to the highest year-over-year change since the fall of 2017. While the improvement has yet to impact home sales, there’s a clear firming of purchase demand that should translate into higher home sales in the second half of this year,” said Sam Khater, Chief Economist, Freddie Mac.

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.

After some ups and downs, steady is the name of the game.

July 16th, 2019

Rates were stable for the second straight week. For the week ending July 10, Freddie Mac announced that 30-year fixed rates remained at 3.75%. The average for 15-year loans increased to 3.22% and the average for five-year ARMs moved up one tick to 3.46%. A year ago, 30-year fixed rates averaged 4.53%, over 0.75% higher than today. Attributed to Sam Khater, Chief Economist, Freddie Mac — “The recent stabilization in rates on home loans reflects modestly improving U.S. economic data and a more accommodative tone from the Federal Reserve to respond to the rising downside economic risk from trade tensions and soft global economic data. On the housing front, the latest weekly purchase application data suggests homebuyer demand continues to rise, which is consistent with the slowly improving real estate data from the last two months.

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.

Like a “tug of war”, rates inched higher when compared to last week when they dropped slightly.

July 8th, 2019

We are seeing mortgage interest rates move up and down as if on a slow moving see saw.  After the previous week’s three-year low, the 30-year fixed-rate mortgage average (FRM) has inched up to 3.75% for the week ending July 3.

According to Freddie Mac’s Primary Mortgage Market Survey, the latest 30-year fixed-rate FRM average is only slightly higher than the 3.73% it averaged in the week ending June 26 – but still significantly lower than the same time a year ago, when the 30-year FRM averaged 4.52%.

Meanwhile, the 15-year FRM averaged 3.18%, up from the previous week when it averaged 3.16%. Lastly, the five-year Treasury-indexed hybrid adjustable-rate mortgage averaged 3.45%, rising from the previous week’s rate of 3.39%.

“We’re seeing a tug of war happen as the fixed income market flashes warning signs while the equities market continues to march higher with optimism,” said Sam Khater, chief economist at Freddie Mac. “The data suggests the economy is weakening but is still on very solid ground with high consumer confidence and a strong labor market. Closer to home, the housing market continues to slowly improve and gain momentum as we head into the second half of the year, which is good news and should keep the economy growing.”

So still we wait to see the strength of the consumer confidence working alongside a growing economy for now which is good for the US.  Until such time when it can no longer sustain such growth and it begins to falter and reverse itself.  When there is bad news for the economy, there is typically good news for mortgage rates.  Keep your eyes open and be ready to call ABBA First to refinance your 4%+ interest rate down!

Compare this 2/bedroom apartment rent to a 3/bedroom mortgage payment.

July 5th, 2019

I’m shocked when I read that a two bedroom unit averages a rental cost of $1469 nationally when one can purchase a very nice 3 bedroom/2 bath home in here in Wilmington through ABBA First Mortgage for less than $1295 all inclusive with 3.5% down.  That’s right.  Today, a first time home buyer or buyers waiting for the right home to come along, can buy a home with less than $6900 out of pocket.  Please call ABBA First Mortgage as we have seen 2 or 3 of these homes come on the market within the last week or so.

To justify our request to look at these homes through one of our real estate agent friends that is keeping us up to date on what is available locally, July saw increased rental prices across the US, according to data from Zumper’s new National Rent Report.

The report found that the national one-bedroom rent rose 0.3% to $1,220 in June. Meanwhile, rental price for a two-bedroom unit slightly fell 0.1% to $1,469 nationwide. Both units’ prices came up 0.8% and 1.9% annually.

Demand for rental spaces in San Francisco drove prices up, with the price of a one-bedroom unit rising $20 to $3,720. San Jose followed, and Boston came down at third. Washington, D.C., ranked as the fifth priciest city, surpassing Los Angles, while Oakland slid to the seventh spot.

A one-bedroom rent in New York, on the other hand, dropped after reaching its three-year peak in Zumper’s last rent report. It now costs $2,940 to rent a one-bedroom apartment in NYC and $3,380 for a two-bedroom unit.

Year-over-year, rental prices in the mid- to lower-tier markets cooled off, experiencing larger amounts of double-digit declines.

By far, Raleigh’s annual rent growth was the fastest last month, up 5.1%. Chicago and Bakersfield had the biggest dips, both coming down 5.1% from 2018.  Why rent when you can buy?  Let us help you get there.  Call ABBA First Mortgage at 910-332-0650.

ABBA First Mortgage wants to help you obtain the lowest rate for your home with a refinance

July 3rd, 2019

I want you to know this- for this is something that I truly believe is coming our way-MORTGAGE INTEREST RATES ARE GOING LOWER-AND POSSIBLY TO THEIR LOWEST!  If this is something that you’re interested in taking advantage of for your home, you must have all your paperwork in place, otherwise you’ll miss the opportunity to be the one that hits the jackpot and catches it when it’s down at its lowest.  For me to lock in your rate when we think it has hit the bottom (for it’s not there yet), as we listen to the concerns of the talks in China, and the unrest of the Middle East, we’re talking of bad global economic news for the USA, which is good news for the US Treasury Bonds and in turn, great news for mortgage interest rates.  Other factors such as the Fed cutting rates at their next meeting and if they do at the end of July- will it be a .25 pt. or might they cut even more?  Other foreign global economies are cutting their bond rates as noted below in the article written by one of the gurus for the mortgage marketplace.  But we could see a touch and go situation which I’ve seen perhaps only 3 times during my 21 year mortgage industry career. It could be there and gone within hours as it was one time when the surge of people wanting to get a mortgage was phenomenal and the banks had to stop taking in any more loans as they could not handle the flow!  This I can tell you without hesitation that it was only the fortunate few that had their loans already in process and ready to go that were able to take advantage of such a wonderful opportunity and get locked in to have their mortgage loan eventually closed at that rate, for they were in process and ready to go.  So let’s be ready together.  Please.  I don’t ever want to beg you to save money- but this is coming.  The following is what this mortgage advisor is suggesting for us to do.  Another is simply saying- be prepared.  It could happen at any moment, just like something as terrible as 9/11 did. No comparison other than to say it would be my advice for you to set the table and complete the online application at your earliest convenience as part of being prepared.  It is found at:

 

https://5329129220.mortgage-application.net/WebApp/Start.aspx?oempage=1

 

Once submitted, and before anything else is done, I will call you, go over the possibilities of what your new loan will look like, ascertain that your new loan will be beneficial for you and your desires, and then move forward according to  whatever you want your next steps to be.  Please call me at 910-332-0650 if you have any questions whatsoever.

Rent or Buy? 45% of renters regret not buying.

July 1st, 2019

More people in the US have said that they regret choosing not to buy a home compared to those who already purchased one, according to the Zillow Housing Aspirations Report.

Almost half (45%) of the respondents said that one of their greatest regrets is renting rather than buying – which is five times the number of homeowners (8%) who regret buying instead of renting.

Meanwhile, more than half of the tenants were disappointed that they could not build equity, customize or even improve their rentals (52% in each case). The other half (50%) wished their rent wasn’t so steep.

Renters were also dissatisfied with their home, saying it’s too small (40% versus 21% of homeowners) and that they do not have private outdoor space (49% versus 25% of homeowners).

The report also found that older homeowners and renters were less regretful. Ninety percent of renters aged 18 to 34 have at least one regret about their place, compared to 82% of renters age 55 and above.

Between those age groups, 38% of millennial renters said pet ownership is too limited, compared to 21% of older renters. Additionally, younger renters (40%) said there was not enough parking, compared to older renters (25%).

Children were also a factor in renters’ regrets. Renters with kids (93%) were more likely to have at least one regret about their home, compared to those without (86%). According to the report, 59% of tenants with children were more likely to regret renting instead of buying, compared to 42% of renters without kids.