By Ismat Sarah Mangla,
Money Magazine

Finding an affordable house is no longer a problem but qualifying for a mortgage can be. Here are six tips to getting a mortgage and a good rate.

1. Put your credit on ice.

The higher your credit score, the lower your rate: The best rates go to those with a 760 or more, says credit-score expert John Ulzheimer.

So keep that plastic in your wallet (and don't apply for new cards or other loans) for at least three months before you go loan shopping. One large balance -- even if it's paid off at the end of the month -- can ding your score by 20 points or more.

2. Ask for time.

Most sales contracts give you only 10 days to nab a loan or the seller can move on. Negotiate for an additional five to 10 days to give you some room to shop around.

3. Get at least six quotes.

Rates on a 30-year fixed conforming loan can vary at least as much as a quarter of a percentage point. Get quotes from national lenders at mortgagemarvel.com and find out what your local credit union or regional bank is offering as well. Inquire about fees; while lenders aren't required to give you a good-faith estimate of closing costs (which average 2 percent of the loan balance) until you actually apply, some will provide it if you ask.

4. Match the lock period to the loan.

You now need 60 days or more to close a loan, says Wharton professor and mortgage expert Jack Guttentag of mtgprofessor.com, and getting an extension on a lock will cost at least a couple of hundred dollars. Ask your lender how long it's taking to close loans like yours -- and don't lock for less.

5. Opt for an ARM.

If you know you're not going to be in a house for more than seven years, adjustable-rate mortgages can mean big savings, says Guttentag. The monthly payment on a $300,000, seven-year ARM at the recent rate of 3.23 percent is $1,302, vs. $1,455 for a 30-year fixed at 4.13 percent.

6. Talk to a broker.

Those who need a jumbo loan or have an unusual situation (say, you're self-employed) will get the best deal from a mortgage broker who has access to and experience with a lot of lenders. Find a fee-only one at upfrontmortgagebrokers.org.

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View the original article here

Although the recently confirmed 3.875% Best-Execution level remains intact for 30yr fixed, conventional loans, Mortgages Rates moved slightly higher today in terms of the costs required to obtain those rates.  Weakness in Treasuries today was more pronounced than MBS, the "mortgage-backed-securities most directly responsible for determining mortgage rates.  (learn more about how we calculate Best-Execution in THIS POST). 

Initially driving today's market movements was news that political leaders would meet in Greece to vote on a soon-to-be-drafted bailout package.  Greek officials have been reluctant to stand up in favor of creditor-imposed austerity.  Even though they likely realize the dire implications of such reluctance, the political backlash from Greece's populace is pretty dire in it's own right.  But that realization has been slow to work its way through markets, which seem to be willing to wait in upbeat anticipation for new developments in Greece that never seem to happen--at least not on time.  

It was the same again today.  Markets were initially upbeat on the promise of ongoing negotiations being concluded.  When we say "markets" in this context, it's more to do with equities/stocks, whereas mortgage rates are part of bond markets.  When markets are upbeat in this way, it decreases the demand for less risky investments such as Treasuries and MBS.  When demand decreases for MBS, prices fall, and that means that lenders will earn less by selling pools of loans on the secondary market, and must raise rates to keep pace with their various cash-flow considerations. 

Even after news came out that the meeting in Greece would not take place until tomorrow, stocks only faltered momentarily, deciding that the nature of the news (no material objections to the proposal on the table, simply a delay in getting it drafted) wasn't enough to reverse the current course.  Bond markets, however, were able to put an end to a somewhat ugly slide weaker.  The damage had already been done as far as mortgage rates would be concerned, but the silver lining is that it only amounted to minimal increases in borrowing costs while most scenarios will still be best-executed at the same rates today as yesterday's.

With the NEW potential resolution on Greek negotiations tomorrow as well as an important 10yr Treasury Auction, there are some sizable risks ahead for mortgage rates, which heretofore have done a good job of holding onto 3.875% Best-Execution through some rough waters.  As always, markets and rates can move in either direction, but we would point out that those movements could be bigger-than-average tomorrow.

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, less 3.75 today, 4.0's getting closer
FHA/VA -3.75%
15 YEAR FIXED -  3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

View the original article here

Google Ends Mortgage Ads; Streamlines to be Nixed from FHA Compare Ratios; Servicing Agreement Bumping Along

This is Black (African-American) History Month. The event began as Black History Week in 1926. For many years, the second week of February was set aside for this celebration to coincide with the birthdays of abolitionist/editor Frederick Douglass and Abraham Lincoln but then expanded in 1976 into Black History Month. The 2010 census counted 42 million black (either a single ethnicity or a combination of races) people in the U.S., nearly 14% of the population. Looking at the states, New York had the highest population with 3.3 million blacks, followed by Florida, Texas, Georgia, California, North Carolina, Illinois, Maryland, Virginia and Ohio. In terms of percentages of overall state population, Mississippi led the nation with 38%, followed by Louisiana (33), Georgia (32), Maryland (31), South Carolina (29) and Alabama (27).

When NASA first started sending up astronauts, they quickly discovered that ballpoint pens would not work in zero gravity.  To combat the problem, NASA scientists spent a decade and $12 billion to develop a pen that writes in zero gravity, upside down, underwater, on almost any surface including glass and at temperatures ranging from below freezing to 300 centigrade. The Russians used a pencil. There's a lesson in that amusing tale for mortgage bankers and Realtors - I just don't know what it is. I do know that the definition of "deleveraging" is, "The process or practice of reducing the level of one's debt by rapidly selling one's assets." As it turns out, Equifax reported that U.S. consumers sharply reduced their debts by 11% last year, from $12.4 trillion to $11.1 trillion.

This news will prompt many lenders to throw a ticker-tape parade that will rival the NY Giants football event today. HUD and the FHA have long promoted the FHA Streamline Refinance as a useful tool to allow responsible homeowners to save thousands of dollars by refinancing at today's low interest rates. FHA-insured borrowers must be current, and in theory they can refinance into today's lower rates without requiring additional underwriting. "However, it has become apparent that some of our lending partners are reluctant to offer this product widely because of concerns about taking on the risk of a loan which they may not have underwritten and the potential adverse impact such a loan may have on their FHA Compare Ratio. In order to expand the availability of this product for eligible borrowers, FHA will make changes to the way in which FHA Streamline Refinance loans are displayed in the Neighborhood Watch Early Warning System (Neighborhood Watch). Streamline Refinances will be removed from the public compare ratio in Neighborhood Watch, but lenders will still be able to view their own traditional compare ratio (with streamlines included)." The Announcement

All eyes are on California as the deadline approaches for state officials to sign onto the multibillion-dollar foreclosure abuse settlement.  As the largest remaining holdout, California appears to leaning towards signing, which could potentially increase the settlement from $19 billion to upward of $25 billion. New York seems to be acting on the same lines. (Do you think the AG's are texting with each other?) Part of the deal for these two states would be the preservation of the right to investigate banks' past misdeeds and adding regulation to ensure that financial institutions adhere to the deal and that the money actually reaches struggling homeowners.  As it stands now, the deal would allocate $17 billion specifically for principal reductions and other relief for up to one million borrowers whose homes are underwater. The 750,000 families whose homes have been foreclosed would receive checks for about $2,000. A deal has been in the making for the past 13 months, as the settlement has been delayed on multiple occasions, so a lot is riding on the decisions of the California and New York Attorneys General - if they do sign on, a finalized deal will come much sooner than later.

As the foreclosure abuses settlement deal finalizes people are getting a better idea of the numbers involved.  The amount that home mortgage securities investors will have to pay is now projected to be up to $40 billion, which, according to the government, would act as a "down payment" for future principal reduction initiatives from future settlements. The White House plans to litigation as a key tool for procuring additional sums from large financial institutions that will be used to further aid for struggling borrowers.  This is part of a trend that has seen the Obama administration escalate efforts to help US borrowers-in addition to the finalization of the foreclosure and loan abuses settlements, a new state and federal unit has been created to investigate mortgage-related fraud.

I will never be an internet mortgage marketing whiz kid. And I guess Google thinks something similar - on the heels of several office closures, Google has discontinued its mortgage rate advertising platform Google Mortgage Advisor after two years of operation.  Apparently the decision was based on the product's poor performance and a company initiative to de-clutter by shutting down programs that aren't as successful as projected. From the Google website: "Google Advisor mortgages has been discontinued We’ve been prioritizing our product efforts across Google, which means taking a hard look at products that haven’t been as successful as we would have hoped. To that end, we’ve closed down the mortgage search feature of Google Advisor and are focused on building continued improvements into the rest of the product."

"Recent changes to the Home Affordable Refinance Program (HARP) present both opportunities and challenges to lenders and services. DataQuick, a provider of advanced real estate information solutions powered by data, analytics and decisioning, has already responded with timely new offerings that quickly identify eligible loan modification candidates. Through the application of proprietary analytics on its nationwide property database, DataQuick has identified 6.7 million borrowers who meet the new eligibility requirements and will most likely benefit from the revised program. Lenders and servicers can easily match their current portfolio to the database to identify the best candidates for loan modification. HARP eligibility requires that candidates have no late mortgage payments in the past six months and no more than one late payment in the past 12 months." Sounds pretty nifty - for more information contact your DataQuick sales representative or Wendy Barnett at wbarnett@dataquick.com. (And nope, this wasn't a paid ad.)

I am not an expert in compliance, but this caught my eye: in the January 24th Federal Register, HUD has proposed a rule  (ECOA/Reg B) that prohibits banks from discriminating against borrowers based on ethnicity, religion, national origin, gender, marital status, age (provided the applicant has the capacity to contract), income from public assistance, or the exercise of any Consumer Credit Protection Act.  The Fair Housing Act prohibits discrimination on account of familial status or handicaps. These are very, very recent developments-both rules go into effect on March 5.  It boggles the mind a bit, but better late than never, one supposes. The January 24th Federal Register entry can be read by clicking http://edocket.access.gpo.gov/2011/pdf/2011-1346.pdf.

The markets certainly don't care about marital status or gender, and yesterday we saw a nice little half-point rally (improvement) in the U.S.10-yr with it closing at 1.90%. With no scheduled news in this country, Treasuries gained today as "risk aversion" was back on worries about Greece. MBS prices improved from nearly .5 on 30-year 3.0% coupons to just roughly unchanged on 4.5's through 6.5's, as one would expect. And then overnight Greece's main political parties reportedly missed a deadline for responding to demands for more austerity measures. Negotiations between Greece and its private creditors are on hold while officials work on a rescue program with the EU, the International Monetary Fund and the European Central Bank. Greece faces a 14.5 billion euro bond repayment in less than six weeks. It won't be able to make the payment without international help.

Here in the states, once again there is no news of substance although we do have a $32 billion 3-yr note auction at 1PM EST. Chairman Bernanke is scheduled to repeat his recent testimony before the House Budget Committee to the Senate Budget Committee beginning at 10AM EST, but don't look for anything new. MBS Prices are down.

HIGH SCHOOL -- 1957 vs. 2010 (Part 2 of 2)
Scenario 5:
Mark gets a headache and takes some aspirin to school.
1957 - Mark shares his aspirin with the Principal out on the smoking dock.
2010 - The police are called and Mark is expelled from school for drug violations. His car is then searched for drugs and weapons.
Scenario 6:
Pedro fails high school English.
1957 - Pedro goes to summer school, passes English and goes to college.
2010 - Pedro's cause is taken up by state. Newspaper articles appear nationally explaining that teaching English as a requirement for graduation is racist. ACLU files class action lawsuit against the state school system and Pedro's English teacher. English is then banned from core curriculum. Pedro is given his diploma anyway but ends up mowing lawns for a living because he cannot speak English.
Scenario 7:
Johnny takes apart leftover firecrackers from the Fourth of July, puts them in a model airplane paint bottle and blows up a red ant bed.
1957 - Ants die.
2010 - ATF, Homeland Security and the FBI are all called. Johnny is charged with domestic terrorism. The FBI investigates his parents - and all siblings are removed from their home and all computers are confiscated. Johnny's dad is placed on a terror watch list and is never allowed to fly again.
Scenario 8:
Johnny falls while running during recess and scrapes his knee. He is found crying by his teacher, Mary. Mary hugs him to comfort him.
1957 - In a short time, Johnny feels better and goes on playing.
2010 - Mary is accused of being a sexual predator and loses her job. She faces 3 years in State Prison. Johnny undergoes 5 years of therapy.

If you're interested, visit my twice-a-month blog at the STRATMOR Group web site located at www.stratmorgroup.com. The current blog discusses residential lending and mortgage programs around the world, part 2. If you have both the time and inclination, make a comment on what I have written, or on other comments so that folks can learn what's going on out there from the other readers.

View the original article here

Following Friday's employment data, Mortgages Rates moved quickly higher.  In most cases, the changes were seen not in the quoted interest rates themselves, but rather in the closing costs required to obtain those rates.  A small number of lenders' Best-Execution rates rose to 4.0%, but a majority stayed at 3.875%.  (learn more about how we calculate Best-Execution in THIS POST). 

For a given interest rate, there are a range of costs at which it could still be a best-execution candidate.  Whereas Friday basically took these costs from the low side (about as low as they'd even been) to the high side, today's improvements serve to moderate that movement back toward somewhat of a middle ground.  In another way of looking at things, you could think of the past three days as 3.875% best-ex rates being in question on Friday afternoon, but are "safe" once again, at least for today. 

Indeed, "safety" is a relative term.  All we can ever truly know is what rates are available on the day we're looking at them.  Even then, rates can change several times a day.  They don't usually do this more than once a day, but it does happen.  While we don't necessarily expect any violent movements in the near future, we can't ever rule out potential volatility.  In that regard, we can at least identify the events and possibilities that could stand as the culprits for such volatility, in the same way we prepared for Friday's jobs report as a high-risk event. 

Of the high risk events this week, some are scheduled while others are not.  The key scheduled events are the US Treasury auctions this week, particularly the 10yr auction on Wednesday and the 30yr auction on Thursday (these two are more pertinent to the MBS--or "Mortgage Backed Securities"--market which most closely governs mortgage rates).  The other "potential event," is a lingering LACK of resolution to an ongoing debate between Greece and it's bond-holders to determine whether or not Greece will receive it's next lump of bailout funds or face default.  It's actually this uncertainty (Greece defaulting would be bad, economically speaking) that's helping rates bounce back from Friday's jobs data.

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, less 3.75 today, 4.0's getting closer
FHA/VA -3.75%
15 YEAR FIXED -  3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

View the original article here

The monthly Employment Situation Report was released at 8:30am this morning, with much better-than-expected results.  Stocks rallied sharply and most every interest rate in fixed-income markets moved higher.  The economic optimism created by this sort of data tends to increase demand for riskier investments like stocks and lower demand for things like fixed-income notes and bonds.  MBS (the "mortgage backed securities" that most directly govern mortgage rates) fall into this fixed-income sector, and definitely weakened following the jobs data.  As a result, Mortgages Rates moved higher at their fastest pace in some time, traversing most of this week's territory, but leaving Best-Execution rates mostly at 3.875%.  (learn more about how we calculate Best-Execution in THIS POST). 

We'd said yesterday that MBS were looking like a runner in baseball taking a "lead-off," waiting to find out whether or not the jobs data would be "a hit."  We went on to say a stronger than expected report would result in MBS simply moving back to the safety of the base to wait for the next pitch.  That's essentially what's transpired today.  Our heroic little base-runner was clearly spooked by the data, and clearly backtracked to previous ground.  But in the process, we see "the base" metaphor emerging as a real possibility, in that markets weakened, but were able to dig in and hold firm after a certain point.  Bottom line, the runner is back on the base, but was not "tagged out," at least not today.

The next pitches will be thrown next week in the form of US Treasury auctions.  While it's true that mortgage rates are based on MBS and NOT on Treasuries, the Treasury Auctions are still a significant event for MBS, especially the longer maturity issues on Wednesday and Thursday.  Things are less certain on Monday and Tuesday, and it's possible rates could be weaker if markets extend today's movements against the backdrop of limited economic data on those first two days of the week.  We'll know a lot more about how longer-term trends are evolving with the passing of at least the first important auction, Wednesday's 10yr Notes.  Between now and then, 3.875% Best-Execution is STILL on the table, albeit at a higher cost than yesterday.  The point is that if you didn't lock yesterday, today is not so much worse that you should just hold off indefinitely.  For those who are taking the risk floating into next week, things could get bumpy, but we'll know a lot more about that on Wednesday. 

On a final note, we have to put out the constant caveat that European headlines do not adhere to a schedule and certainly have the potential to move markets in unexpected ways, by unexpected amounts, at unexpected times.

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, less 3.75 today, 4.0's getting closer
FHA/VA -3.75%
15 YEAR FIXED -  3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

View the original article here

On the eve of the Nevada primary, in which housing policy will weigh heavily on residents of the foreclosure-ridden state, PBS' "Need to Know" takes a closer look at what the housing crisis looks and feels like for locals. In the video special below, which airs in full at 8:30 p.m. EST tonight, the "Need to Know" team explores the pitfalls of trying to attain a mortgage modification. Claims about lenders who require borrowers to become delinquent before they can help them are legion, and "Need to Know" speaks with a Nevada woman whose story echoes the frustration of thousands of underwater homeowners. Watch a clip from the show below.

View the original article here

By Andrew Scoggin

New York Attorney General Eric Schneiderman filed a lawsuit Friday against three of the nation's biggest banks and Mortgage Electronic Registration Systems over allegedly fraudulent foreclosure actions.

In the complaint, Schneiderman (pictured) said the creation of MERS led to a system that resulted in homeowners and public servants being unable to track their own mortgages.

MERS, in response, said that is not operating outside the law and that pass judgement will exonerate the validity of the electonic registry's actions.

Read the full story on HousingWire.com.

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
Finds homes for rent in your area.

View the original article here

WASHINGTON -- The average rate on the 30-year-fixed mortgage fell this week to a record low, the ninth time that has happened in the last year. But even with the cheapest rates in history, the housing market remains depressed.

Mortgage buyer Freddie Mac said Thursday that the rate on the 30-year loan dropped to 3.87 percent this week. That is below the previous record of 3.88 hit two weeks ago.

The average on the 15-year fixed mortgage fell to 3.14 percent, also a record low. Records for mortgage rates date back to the 1950s.

Mortgage rates tend to track the yield on the 10-year Treasury note, which fell below 1.9 percent this week.

Rates have been low for more than a year, and the average rate on the 30-year loan has hovered near 4 percent for more than three months. Yet few people can afford to buy a home or qualify for a loan. Many of those who can have already done so.

High unemployment and scant wage gains have made it harder for many others to qualify for loans. Still others don't want to sink money into a home that they fear could lose value over the next few years.

Sales of previously occupied homes were dismal last year. New-home sales in 2011 were the worst on records going back half a century.

Builders are hopeful that the low rates could boost sales next year. But so far, they have had a minimal impact.

Mortgage applications have risen slightly over the past four weeks, according to the Mortgage Bankers Association. But they are coming off extremely low levels.

To calculate the average rates, Freddie Mac surveys lenders across the country Monday through Wednesday of each week.

The average rates don't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for the 30-year loan rose to 0.8 from 0.7; the average on the 15-year fixed mortgage was unchanged at 0.8.

For the five-year adjustable loan, the average rate fell to 2.80 percent from 2.85 percent. The average on the one-year adjustable loan rose to 2.76 percent from 2.74 percent.

The average fee on the five-year adjustable loan rose was unchanged at 0.7; the average on the one-year adjustable-rate loan was unchanged at 0.6.

Copyright 2012 The Associated Press. The information contained in the AP news report may not be published, broadcast, rewritten or otherwise distributed without the prior written authority of The Associated Press. Active hyperlinks have been inserted by AOL.

Also see:
Open Houses of the Week: Super Bowl Weekend
Distressed Sales Undercut Home Prices in 2011, Study Says

View the original article here

After setting new record lows yesterday, Mortgages Rates rose slightly today, though 3.875% best-execution remains intact.  Rather than affect the prevailing rates being quoted, today's weakness is most likely to be seen in the form of slightly higher borrowing/closing costs for the same rates quoted yesterday (learn more about how we calculate Best-Execution in THIS POST).  The increases run counter to today's market movements as well.  

Treasury yields are lower again today, and MBS (the "mortgage-backed-securities" that most directly govern interest rates) are slightly improved as well.  One reason that loan pricing hasn't adjusted to match that fact is that MBS weakened late in the trading session yesterday.  Not all lenders priced that in by issuing adjusted rate sheets, instead reflecting the changes in this morning's rates.  The MBS market was indeed weaker this morning, so if we're comparing the time of day that most lenders put out their first rate sheets, today was indeed worse than yesterday.  Beyond that objective explanation, we also have to consider the fact that continued rate improvements from all-time lows are going to continue to be slow and hard-fought.  Lenders have little incentive to offer lower rates if current offerings are generating more-than-sufficient demand.  (read more on this topic in this previous post)

Finally, and although it's not the only other potential factor, this Friday's Employment Situation Report (aka "jobs report," or "NFP") represents a high-risk situation, ESPECIALLY with mortgage rates at or near all-time lows.  NFP, which stands for the the reports chief component "Non-Farm-Payrolls" is generally regarded as the single most important piece of economic data each month.  Even against the current backdrop of European headlines exerting more and more influence on domestic markets, it's immensely important.  Based on where markets sit right now, we think that rates are somewhat vulnerable if the report is better-than expected.  In other words, there's a certain natural level of "push-back" at current rate levels anyway, and a bullish jobs report would probably accelerate that. 

This, of course, is contingent on the report coming in with better-than-expected results.  If the opposite happens, rates could still improve.  It's just that those improvements would likely be slower and smaller than the losses would be in the opposite scenario.  It's also very much contingent on rates not moving much between now and Thursday afternoon, which may or may not be the case.

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, with a few lenders on either side of this
FHA/VA -3.75%
15 YEAR FIXED -  3.25%, some lenders venturing lower, some completely stuck at 3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

View the original article here

Mortgages Rates are just slightly better than unchanged on the day.  Best-Execution remains at 3.875% for conventional 30yr fixed loans, and the slight improvements seen today have benefited the borrowing costs required to obtain those rates.   (learn more about how we calculate Best-Execution in THIS POST).  Some of the stratification between lender offerings seems to be lessening now that underlying markets have demonstrated the ability to hold recent levels.  

Particularly, MBS (the "mortgage-backed securities" that most directly affect mortgage rates) recently reached new all-time highs.  The fact that this is occurring at the same time rates are back at new all-time lows is no coincidence.  But it also means that there are some physics-based considerations for MBS prices (higher prices = lower rates).  Of course we're not talking about real physics, but consider the adage "what goes up, must come down."  Now, this isn't a universal truth in bond markets, and certainly it was heard on several occassions over the past 5 months, with everyone who mentioned it turning out to be wrong.  So we're not saying MBS prices are destined to go lower simply because they've hit their all-time highs (meaning rates would likely move higher off all time lows). 

What we ARE saying is that things have never been as good as they are right now in terms of MBS and the rates that lenders are offering.  We certainly don't rule out the possibility that things could get even better, but we'd sure hate to have missed out on this opportunity if they don't.  The comforting caveat is that if things do improve, that progress will likely be slow and potentially limited in scope.

Tomorrow is the last day until Friday's Employment Situation Report (aka "jobs report," or "NFP") brings a high-risk situation into the mix.  NFP, which stands for the the reports chief component "Non-Farm-Payrolls" is generally regarded as the single most important piece of economic data each month.  Even against the current backdrop of European headlines exerting more and more influence on domestic markets, it's immensely important.  Based on where markets sit right now, we think that rates are somewhat vulnerable if the report is better-than expected.  In other words, there's a certain natural level of "push-back" at current rate levels anyway, and a bullish jobs report would probably accelerate that. 

This, of course, is contingent on the report coming in with better-than-expected results.  If the opposite happens, rates could still improve. 

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, increasing presence at 3.75%
FHA/VA -3.75%
15 YEAR FIXED -  3.25%, some lenders venturing lower, some completely stuck at 3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

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It's happened before and it happened again today: Mortgages Rates hit new all time lows today.  Please note, that the actual interest rate you would have been quoted last week and this week may not have changed, but based on raw data from more than 20 leading lenders as well as feedback from the MBS Live community, the average Best-Execution rate, before rounding to the nearest eighth, hit its lowest level on record, 3.81%.  Although 3.81% is closer to 3.75% than 3.875%, we won't declare 3.75% to be the Best-Execution champ until the average from our lender survey falls to 3.75 or lower, and we're not there yet.  (if the last paragraph is confusing, we went into some more detail on these methodologies in THIS POST).

Last week, we noted a high degree of stratification in rates as lenders responded to the bond market rally at different paces.  This continues to be the case today, but perhaps to a slightly smaller extent.  When we say that rate offerings are more stratified, we're talking about various lenders offering increasingly different rates to the same type of borrowers.  Among some lenders in our survey, best-execution rates are still at 4.0%, while the bulk have moved down to 3.875% and 3.75%.  The important point here is to not believe everything you read about mortgage rates these days, unless the source examines multiple lenders and offers the caveat that they can only report averages while individual experiences may vary. 

For instance, several lenders are priced WORSE today than Friday.  It's far more important to be working with someone you trust in a process that is more likely to hit its deadlines than to go overboard in pursuing the lowest possible quotes.  In the current market, overfocus on lowest possible rates can lead to delays which can result in a higher rate than the one you were originally trying to avoid!

Today's BEST-EXECUTION Rates

30YR FIXED -  3.875% mostly, with a few lenders at 3.75%.  Less 4.0's today
FHA/VA -3.75%
15 YEAR FIXED -  3.25%, some lenders venturing lower, some completely stuck at 3.25%
5 YEAR ARMS -  2.625-3.25% depending on the lender

Ongoing Lock/Float Considerations

Rates and costs continue to operate near all time best levelsCurrent levels have experienced increasing resistance in improving much from hereThere are technical reasons for that as well as fundamental reasons
Lenders tend to get busier when rates are in this "high 3's" level and can throttle their inbound volume by raising rates or costs.While we don't necessarily think rates are destined to go higher, given the above facts, there seems to be more risk than reward regarding floatingBut that will always be the case when rates operating near historic lows(As always, please keep in mind that our talk of Best-Execution always pertains to a completely ideal scenario.  There can be all sorts of reasons that your quoted rate would not be the same as our average rates, and in those cases, assuming you're following along on a day to day basis, simply use the Best-Ex levels we quote as a baseline to track potential movement in your quoted rate).You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

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The Mortgage Bankers Association (MBA) provided its annual assessment of The State of the Mortgage Industry in a press conference Wednesday afternoon.  Michael Young, MBA Chairman said that the states that have been hardest hit by the housing crisis are and will continue to deal with the aftermath but there are signs that in much of the nation 2012 will bring a recovering market.

One bright spot, Young said, is that the turmoil in the single family market has actually helped the multi-family sector; the rental market has tightened and more lenders have moved into the sector, especially life insurance companies.  In the residential market, he said, the one topic that is discussed everywhere is the lack of financing and what can be done about it.

David H. Stevens, MBA President and CEO said that lack of financing can be traced to a single factor, market uncertainty.  Part of it is uncertainty about international markets and how they might ultimately impact the domestic situation but there is also a tremendous amount of uncertainty about regulation.  Dodd-Frank, he said, has 300 regulations that have yet to be fully promulgated and the new Consumer Financial Protection Bureau (CFPB) and other regulators all have or are considering regulations about how loans can be provided and serviced.  There is uncertainty surrounding repurchases as well and while MBA believes lenders should be held accountable for their mistakes, they should not be held accountable for the loans performance if it failed solely due to changing economic circumstances.  For that reason MBA supports a time limit on the repurchase obligation.

Addressing three areas in particular, he said, would decrease a lot of the insecurity.  New regulations regarding Qualified Mortgages (QM) and Qualified Residential Mortgages (QRM) are eminent and QM will in effect, define what loans get made.  Mortgages which do not meet QM as laid out by CRPB will simply not get made because lenders will feel there is too much liability involved.   MBA supports certain parts of the QM such as the requirement for full documentation but other parts such as the point and fee cap lack flexibility and will disproportionately affect the pricing of small loans.  

Most of all, he said, the proposed regulations are too general.  There needs to be specificity in the underwriting standards such as in the definition of what constitutions "ability to repay."  Without a bright line in the regulations that enable a safe harbor for lenders, he said, any lending is going to be restricted on the margins and any loans that fall into the gap between QM and QRM will see significant price adjustments to reflect the liability.

While MBA also supports risk retention and much of the intent of the QRM such as eliminating no-docs and interest only and other exotic loans, regulators are going beyond the intent of Congress by adding debt to income and loan-to-value ratios.  The requirement for a 20 percent down payment will create a dual class system under QRM, with lower income borrowers, unable to amass the down payment; forced into FHA loans while there will be a private market for upper income borrowers.  Stevens said MBA will be "very aggressive" in making sure these changes to QRM are pulled back.

Another area of uncertainty is the 50-state settlement with servicers.  Borrowers don't care about their servicers until they get into trouble with their mortgages but then the multiple state and federal laws that govern servicing cause stress for the borrowers and for servicers and investors as well.  The settlement may provide a framework for national standards which would remove some of the uncertainty in this area.  In the same vein, Stevens said that President Obama's new fraud task force must be careful to avoid redundancy with other investigations and carefully measure how it impacts borrowers or it could create trepidation among lenders and further reluctance to lend.  

The present structure of the mortgage market with 90 percent of lending having some government involvement through the GSEs or FHA is simply unsustainable, Stevens said.  The private sector must be brought back into the market and the major players in the industry are close to agreement on what the future of the secondary market should look like.  This is very close to a model proposed by MBA some years ago which would have the following characteristics:

Transactions would be funded with private capital from a broad range of sources.The federal government should have a role in promoting stability and liquidity in the core mortgage market. This role should be in the form of an explicit credit guarantee on a class of mortgage-backed securities and the guarantee would be paid for by risk-based fees.Taxpayers and the system itself should be protected through limits on the mortgage products covered, the types of activities undertaken, strong risk-based capital requirement, and actuarially fair payments into a federal insurance fund.

In answer to a reporter's question about the chances of President Obama's streamlined refinancing program being approved, Stevens said it would be an uphill climb.  FHA is legislatively limited to loans with a maximum LTV of 97.5 percent so to go as high as 140 percent which Steven's said he expected the legislation to attempt will require full approval of Congress.

Jay Brinkmann, Senior Vice President and Chief Economists said he expects jobs to be created at about a 150,000 per month pace in 2012 but this will be uneven by location and dependent on an individual's education.  The length of unemployment hit a record high in November and persons with a high school education or less are remaining unemployed longer than those with a college degree.

According to Brinkmann, mortgage originations will drop from $1.26 trillion in 2011 to $992 billion in 2012 with most of the loss coming in refinancing.  The purchase market will be largely unchanged or will rise slightly.  This does not, however, reflect any changes that might be made in the HARP program or any unforeseen outside events.

You can see a list of all comments on MND by clicking the 'Read the Latest Comments' option under the 'Community' menu.

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How much residents of each state owe on their mortgages is an interesting statistic. For the most part, residents of the states with the highest average mortgage debt are not in trouble. While the average home price in these states dropped in value during the recession, the foreclosure rates in these states are among the lowest in the country. The reason: Residents of these states can generally afford to lose and owe more money than their counterparts in other states. (Click the gallery below to see the full list.)
24/7 Wall St. examined a recent report by Credit Karma to find the 10 states with the highest average mortgage debt. Most of the states on our list have extremely high mortgage debt because of the size of their initial mortgages. States like Connecticut and Massachusetts, which have among the highest median home values in the U.S., also have among the highest mortgage debt. Hawaii, which has the second-highest average mortgage debt per person, has the highest median home value of $525,400.

Many of the states on the list also experienced the steepest declines in home value during the recession. Home prices in seven of the states with the highest mortgage debt declined during the recession. In states like California and Nevada, properties lost more than 30 percent of their value. Even in states like New Jersey and Maryland, which fared relatively well during the recession, homes lost between 7 percent and 10 percent of their value.

Sharp declines in home values, coupled with high mortgage debt, should translate to financial disaster. However, while home values dropped more than 7 percent in Maryland, Massachusetts and New Jersey -- states where mortgage debt is the highest -- foreclosure rates stayed low.

Meanwhile, states with the lowest median home value and relatively high mortgage debt tend to have the highest foreclosure rates. Illinois, Michigan and Florida all have median home values below the national average and relatively high mortgage debt compared to housing prices in the state. These states also have among the highest foreclosure rates in the country.

More from 24/7 Wall St.:
10 Cities Crushed by the Global Recession
Americans Want Federal Aid for Housing, But Lack Ideas
Worst Cities for Retirees to Find Work

Also see:
Report: Foreclosures Down, But Discounts Abound
New Home Sales 2011: Worst Year on Record

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
See celebrity real estate.

View the original article here

By Jack Guttentag for Inman News

Millions of mortgage borrowers who can no longer afford their mortgage payments but can afford a lower payment can avoid foreclosure by getting a modification of their loan contract. While the path to a modification remains torturous, it is not quite as bad as when I addressed the issue in a 2009 column. Here are six steps on the path to getting one.

1. Are you unqualified?

It is not possible for borrowers acting on their own to determine whether they qualify for a modification because they don't have access to all the criteria. Some is kept under wraps by loan servicers. However, borrowers can determine that they are not qualified for a government-supported modification by accessing a questionnaire provided by the U.S. Treasury Department.

Bear in mind, however, that servicers also offer modifications outside of the government's program. You might qualify for one even if you don't meet the government's requirements.

2. Compiling the information the servicer wants

The single most important step in obtaining a loan modification is providing the servicer with the exact information the servicer needs to make a decision. Each servicer has its own set of forms that must be completed, and its own requirements for the documentation you must provide.

In my first stab at this problem, I placed the information required by each of the major servicers on my website. Now borrowers can access the DMM Document Wizard, provided at my request by Default Mitigation Management LLC, which is a lot better. Based on your answers to the questions it asks, you will be provided with a customized list of forms you must complete and documents you must provide. It is free and will take the guesswork out of what you need.

3. Don't exaggerate your financial shortcomings

Warning: The servicer will examine your statements of income and expenses to determine whether you can afford a reduced payment. Exaggerating your financial weaknesses may open his heart but close his purse, if it makes you appear to be a lost cause.

4. Assuring accuracy

Having the right form is one thing, but filling it out correctly is something else. Some industry executives estimate that about 95 percent of all packages submitted are incomplete or contain errors. A package with obvious errors may fall to the bottom of the pile, or it may lead the servicer to conclude that you do not qualify for a loan modification when, in fact, you do. Remember what you were taught in second grade: Neatness counts!

In addition:

a. Use a cover sheet that identifies all documents in your package.

b. Write your name and loan number on every page.

5. Assuring delivery

Preparing an accurate and complete set of documents is one thing, but delivering the package to the servicer is something else. Servicer systems have been overwhelmed by requests for help, and documents routinely get "lost." You want to minimize the chances of that happening to you.

Using fax or certified mail: Make sure you have the correct contact information. Treasury provides addresses and fax numbers of every mortgage servicer. Certified mail is more reliable than fax, but neither guarantees prompt attention by the servicer, or even that the documents won't subsequently be misplaced or lost.

6. Using the DMM portal: The best way to deliver documents to servicers is to use the DMM portal, available through the DMM Document Wizard by clicking on "Submit," or visit www.dclmwp.com. I have no financial interest in DMM.

Using the portal, your documents are delivered to the servicer electronically, and the portal then becomes a direct communication channel to the servicer. The servicer uses the portal to acknowledge receipt of your documents and to request additional information or documents. You use the portal to make corrections, to send additional information, and to update yourself on what has been completed and what remains to be done.

Questions by you are automatically directed to the specific employee who can answer them. All communications are time-stamped and remain in the portal as a record of borrower/servicer exchanges.

Unfortunately, not every servicer subscribes to the DMM Portal. The list of those that do is shown on the DMM Wizard.

7. Follow up, and then follow up again

Because the process of modifying mortgages remains slow and error-prone, you may need to nudge the servicer. If you faxed your documents, you should follow up to make sure the papers haven't been lost and the case is in an active queue. But even if you use the DMM Portal, you should follow up with the servicer regularly to make sure your application is on track.

My special thanks to Igor Roitburg for assisting in my research for this column.

The writer is professor of finance emeritus at the Wharton School of the University of Pennsylvania. Comments and questions can be left at www.mtgprofessor.com.

More from Inman News:
10 Real Estate Markets to Watch in 2012
10 Metros With Biggest 1-year Rise In Real Estate List Prices
Must See: A House That's For The Dogs
Starbucks Coffee: Now Served In Cargo Containers

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Tracy Morgan is no stranger to controversy, but it's not often that a comedian can count his mother among his biggest critics.

The "30 Rock" funnyman is being accused of not helping to save his mother from foreclosure on her Ohio home, the New York Daily News reports.

Morgan's mother, Alicia Warden, told the Daily News that she owes approximately $25,000 on her home. After an apparent spat with Warden, in which Morgan accused his mother of speaking with the media behind his back, she claims that he reneged on his offer to help with the mortgage. Instead, he is currently offering a $2,000 "one-shot deal," Warden told the paper.

If Warden does not make a minimum payment toward the mortgage by Feb. 23, the lender will initiate foreclosure proceedings.

"He's never been a nice person," Morgan's younger sister, Asia, told the Daily News. She described her brother as a "d--- bag," who has gotten worse with fame and fortune. Morgan is worth an estimated $18 million.

Of course, Morgan's off-screen behavior is regular grist for the gossip mill, so much so that it's melded with that of his Tracy Jordan character on "30 Rock." Less than two weeks ago, Morgan passed out at a Sundance Festival awards ceremony shortly after giving what some called an incoherent acceptance speech, reported TMZ.

Neither drugs nor alcohol were found in Morgan's system, and a spokesman for him claimed that it was high altitude and fatigue that caused the spell, the San Francisco Chronicle said.

Last summer, Morgan was asked to apologize by the Gay & Lesbian Alliance Against Defamation, when he said during a standup routine that he would stab his son to death if he was gay. Morgan issued the apology, and the topic was lampooned in a recent episode of "30 Rock."

When, if ever, this episode in Morgan's real-life family drama becomes sitcom fodder remains to be seen.

Also see:
Songwriter Denise Rich Lists New York's Most Expensive Co-op
Chef Gordon Ramsay Bites on $6.75 Million Bel-Air Home
Joe Montana Drops Home Price by $14 Million

More on AOL Real Estate:
Find out how to calculate mortgage payments.
Find homes for sale in your area.
Find foreclosures in your area.
See celebrity real estate.

View the original article here