Danny Salas

Archive for the 'Interest Rates' Category

HARP Changes to Reach More Borrowers

News Release obtained from http://www.fhfa.gov/webfiles/22721/HARP_release_102411_Final.pdf

FEDERAL HOUSING FINANCE AGENCY News Release: 10/24/11

 

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The Smart Consumer’s Guide To Home Ownership

The Mortgage Guide Book

New FHA Loan Limit Beginning October 1, 2011

The PDF below provides notice of the posting of the comprehensive update to the Federal Housing Administration’s (FHA) single-family loan limits which are effective on or after October 1, 2011 through December 31, 2011. These limits apply to forward mortgages insured under section 203(b)(2) of the National Housing Act and  reverse mortgages insured under section 255 (Home Equity Conversion Mortgages (HECM)). A mortgagee letter providing further guidance has been issued August 19, 2011.

Links below are for any additional information you may need.

Complete schedules of FHA mortgage limits for all areas for forward mortgages will be available through the downloadable file links found at https://entp.hud.gov/idapp/html/hicostlook.cfm The website also provides a current look-up tool that will have the capability

Market Analysis Brief: http://portal.hud.gov/hudportal/documents/huddoc?id=FHA_Loan_Limits_HERA.pdf

FHA publications at HudClips: http://www.hud.gov/offices/adm/hudclips/index.cfm  Order hardcopies at: http://portal.hud.gov/hudportal/HUD?src=/program_offices/administration/dds

 FHA forms: http://portal.hud.gov/portal/page/portal/HUD/program_offices/administration/hudclips/forms

 FHA Homeownership Centers: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/hoc/hsghocs

 Events & Training Calendar: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/events/events

 Contracting Opportunities: http://portal.hud.gov/portal/page/portal/HUD/program_offices/cpo

 Career opportunities: http://www.usajobs.opm.gov/

 Grant opportunities: http://portal.hud.gov/portal/page/portal/HUD/program_offices/administration/grants/fundsavail

 Presidentially Declared Disaster Areas: http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/nsc/disaster

 Foreclosure Assistance: http://portal.hud.gov/hudportal/HUD?src=/i_want_to/talk_to_a_housing_counselor

 Making Home Affordable: http://www.makinghomeaffordable.gov/pages/default.aspx 

This list does not provide HudHome property listings. To see the latest list of all HudHomes nationwide please visit: http://hudhomestore.com/HudHome/Index.aspx

 This list will often provide training opportunities and event announcements for non-profit and local government HUD partners. HUD does not endorse the organizations sponsoring linked websites, and do not endorse the views they express or the products/services they or their community/business partners offer. For more information on HUD’s web policies please visit: http://www.hud.gov/assist/webpolicies.cfm

Statistics Merit: Best Time to Buy in 40 Years

 

Danny Salas on Real Estate Today Radio Explains why now is the most affordable time to buy.

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The National Association of Realtors’ Housing Affordability Index recently shed light on something quite exciting:  A forty-year record level reading! 

The index has been reporting data, on housing, since 1970, and it’s never been more affordable to purchase a new home.  If you want to purchase a home, keep in mind I’m only speaking statistically; this is the time to buy! It’s imperative that you study your financial strength with a competent financial advisor, and mortgage banking specialist, to determine if you’re ready to buy.  Do you have your financing in order, or your housing budget at a comfortable level?  If you’re considering around a five-year, seven-year, or longer, investment, than it just might not get any better than the present.

The Composite Index of Housing Affordability read at 182.7.  This is, again, the highest level in the forty-one years of reporting the data.  In 1981, the index was the lowest it has ever been, at 68.9  Interest rates were at approximately 18%.  Think about that…it’s more than two and a half times more affordable to buy a home, than it was in 1981. 

Some of the data that is considered, regarding the Housing Affordability Index is the Median Sales Price, Interest Rates, monthly payments, and qualifying income.  Obviously, sales price and interest rates, determine payments, but what’s interesting is qualifying income.  With unemployment levels so low, nationally and locally, the surprising statistic might be qualifying income, however, bear in mind that with prices SO low, and interest rates SO low, as well…income simply doesn’t HAVE to be as high, to qualify for that median priced home.  Very exciting news! 

You will want to take somewhat of an urgent move, if you’ve positioned yourself structurally sound to buy.  Keep in mind that if rates move just one percent upwardly, home values would have to fall OVER ten percent in order for you to keep the same monthly payment.  If the United States’ debt ceiling issue creates more panic, in the markets, like Lehman Brothers’ panic, post mortgage credit crisis, and rates move to 7.5%, then you’ll need values to drop over THIRTY PERCENT, in order to keep your payments at the same levels.  This index is not going to stay at these level forever!  I did write about this, on my blog-page, back in November of 2009.  Even then, most experts felt that rates will steadily increase over that next twelve months, however, as European Countries struggled financially, mortgage-backed securities, and other bonds, were a safe-haven for investors, keeping our rates low.  This, also, will not last forever, and if you’ve determined that you’re ready to buy…BUY! 

Check out the Blog Article at:  http://accessloans.net/2009/11/11/why-buy-now-why-rate-outweights-price/

 

Where Are Interest Rates Going?

 First of all, QE II has ended.  There are mixed feelings regarding how this effected The United States.  First, you cannot ignore that since the announcement of QE II, Stocks have increased an average of 34%.  So, while QE I was primarily designed to purchase bonds, and keep interest rates low, QE II focused on pumping more money into Stocks and other commodities.  This is generally, not good for interest rates, however, again, with European concerns, bonds and Mortgage-Backed Securities remained a healthy, safe investment, for foreign markets, keeping our rates low.  The effect of QE II, on the economy, is also argumentatively, positive.  When you lift the market, you lift the spirit of investors.  When investors’ spirits are up, they spend.  However, it hasn’t done much for employment, or eighty, or more percent, of the nation.  So, the help in the economy really came indirectly.  QE III?  Perhaps.  If they announce another plan to print money, and buy stocks, or US Treasuries, Bonds, etc., it might just scare the market too much, and the value of the dollar could plummet.  So, the QE III plan, might just be a statement from the Federal Reserve that they are, “interested in keeping the markets moving, by a structured, secure purchasing plan of Stocks, Bonds, AND Commodities.”  Who knows?  If there isn’t a release of QE III, expect higher rates, to gradually occur, if there’s a release of QE III…and they print more money…expect higher rates when the result of more printed money, is inflation (interest rates’ worst enemy).

One of the only factors that could keep rates lower, would be if the economy starts to heat up, enough, for investors, and banks, to start purchasing the US Treasuries that our government has already purchased…to keep the market moving.  When and if that ever happens…rates will stay low.  My money’s on one of the earlier comments, as when have you seen Banks come to the rescue of the United States?  Or, is that an oxymoron?