Adjustable-rate mortgages, known as ARMs, are back, despite having earned a bad reputation at the height of the housing crisis. Post-crisis borrowers saw them as risky because of their changing interest rates, and blamed the glut of foreclosures on the inability of homeowners to handle higher payments when the loans reset. “ARMs became a four-letter word after the housing crisis,” said Ann Thompson, a retail sales executive for Bank of America in San Francisco. “They got a bad rap and were lumped in with ‘pick-a-payment’ loans, which allowed people to pay as little or as much as they wanted on their mortgage.” Lately there’s been a resurgence in ARMs. In January 2019, 8.6 percent of new mortgage loans had an adjustable rate, compared with 5.5 percent in January 2018, according to Ellie Mae, a software company that processes 35 percent of mortgages in the United States. One reason for the resurgence could be the safeguards in place that make … [Read more...] about Are adjustable-rate mortgages worth the risk?
20 year fixed refinance rates
By Jeff Lazerson | | PUBLISHED: August 9, 2018 at 12:45 pm | UPDATED: August 9, 2018 at 12:46 pm What’s up with mortgage rates? Jeff Lazerson of Mortgage Grader in Laguna Niguel gives us his take. Rate news summary From Freddie Mac’s weekly survey: The 30-year fixed rate averaged 4.59 percent, down 1 basis point from last week’s 4.60 percent. The 15-year fixed rate averaged 4.05 percent, 3 basis points better than last week’s 4.08 percent. The Mortgage Bankers Association reported a 3 percent decrease in loan application volume from the previous week. The refinance index is now at its lowest level since December 2000. Bottom line: Assuming a borrower gets the average 30-year fixed rate on a conforming $453,100 loan, last year’s rate of 3.92 percent and payment of $2,142 is $165 lower than this week’s payment of $2,307. What I see: Locally, well-qualified borrowers can get the following fixed rate mortgages for a 1-point cost: 15-year at 3.5 … [Read more...] about First time ever: Standalone fixed-rate second mortgages allow 100% cash-out
The Reserve Bank of India is likely to raise interest rates on Wednesday while retaining a neutral policy stance as it aims to strike a balance between rising inflationary pressures and still recovering growth.The pound fell on Thursday despite the Bank of England lifting interest rates from crisis-era lows, after Governor Mark Carney said monetary policy needed to "walk not run" and expressed concern about the risks of a cliff-edge Brexit.It also fleshed out its thinking on how far it is likely to go with its planned rate hikes by publishing a new long-term forecast for what it called Britain's trend real interest rate, or "R*", of zero to 1 percent, more than 2 percentage points below its pre-financial crisis level.Still, a sizable numbers of analysts and market participants believe the RBI could hold off and not hike interest rates, noting that the recovery is nascent and bank credit to corporates is not yet free flowing. This time too, RBI has maintained neutral stance with an … [Read more...] about RBI monetary policy: Repo rate hiked by 25 bps
The Federal Reserve did not raise interest rates Wednesday, but it did set the stage for a September hike. That gives consumers time to firm up their finances. Fed officials, including Chairman Jerome Powell, have already raised interest rates twice this year and pointed to two more increases before the end of 2018. Yet just last month, President Donald Trump criticized the Fed, saying rate increases are hurting the economy. Despite the long-standing convention that monetary tightening is necessary to temper inflation, Trump favors holding rates down in the face of economic growth. For the average American, rising inflation, which pushed the central bank into hiking rates back in 2015, isn't necessarily bad. It's generally considered an indication that the economy is doing well, and paves the way for raises and a better return on your savings. However, in daily life, higher interest rates mean that you'll have to pay more to access credit. "The cost of … [Read more...] about The Fed Didn’t Raise Rates This Time, But Will Again. Here’s How to Prepare for the Next Hike
Kathy Orton, The Washington Post Published 9:19 am CDT, Thursday, July 26, 2018 Photo: Phillip Spears/Getty Images Image 1of/1 CaptionClose Image 1 of 1 According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average rose to its highest level in a month. According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average rose to its highest level in a month. Photo: Phillip Spears/Getty Images Signs point to mortgage rates rising, making home-buying more expensive 1 / 1 Back to Gallery Mortgage rates, which have been in a rut the past couple months, began moving higher this week. According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average rose to its highest level in a month. It grew to 4.54 percent with an average 0.5 … [Read more...] about Signs point to mortgage rates rising, making home-buying more expensive