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Drop in Mortgage Rates has Utah Mortgage Refinance Applications Skyrocketing

Posted by Bud Bruening

The recent drop in Utah Mortgage Rates has Mortgage Brokers scrambling to get their clients the very best rate available. According to FHA, Multifamily loan applications have broken previous records.

The FHA fiscal year ends in October. So far, it endorsed nearly 1,100 multifamily loans, seven times the amount three years ago. For only the second time, loan activity surpassed $10 billion.

For the entire industry, commercial and multifamily originations doubled in the second quarter from last year, according to the Mortgage Bankers Association.

“FHA has never been more relevant in making sure the multifamily apartment marketplace continues to function even during these tough economic times,” said Carol Galante, FHA’s acting commissioner. “While we’re seeing record volume, we also recognize we have to accelerate the time it takes us to process these applications so we continue to meet this demand at the very time the market needs us the most.”

USDA Mortgage Financing and VA Financing has also seen a huge increase in loan origination business. USDA and VA Mortgage Financing both offer 100% financing meaning that a prospective buyer can buy a home using these types of loan programs without have a down-payment.

Down-Payment Assistance programs in Utah have also seen a huge increase in applications. Down-Payment assistance programs allow home buyers to get financing without having a down-payment.

For questions about Utah Mortgages and Utah Down-Payment Assistance Programs give the Mortgage Solutions Team a call.

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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It’s Official, It’s Now Cheaper to Buy a Home Rather than Rent!

Posted by Bud Bruening – Utah’s Lowest Mortgage Rates
 
HOMEOWNERSHIP BEATS RENTING IN 74 PERCENT OF MAJOR U.S. CITIES
Trulia Releases Summer Rent vs. Buy Index, Revealing Housing Market Rebound in Miami and Continued Setbacks in Detroit, Fresno and Sacramento

SAN FRANCISCO, August 16, 2011 – Trulia today released its Summer 2011 Rent vs. Buy Index, which compares the cost of buying and renting a two-bedroom apartment, condominium or townhouse in America’s 50 largest cities based on population.

 

Homeownership Affordability Remains High
Based on current market conditions, buying a home
is cheaper than renting in 74 percent of major U.S. cities. Meanwhile, it is clearly better to rent in New York, Fort Worth, Omaha, Seattle, San Francisco and Kansas City. In between both sides of the rent versus buy spectrum, there is a grey area. Depending on personal circumstances, such as one’s tax bracket, it may make more sense to buy a home in Oakland, Austin, San Jose, Memphis, Boston, Los Angeles and Portland, even though it is still relatively cheaper to rent.

Top Five Cities Where Buying Beats Renting

#

City

State

Price:Rent Ratio

1

Las Vegas

NV

6

2

Detroit

MI

7

3

Mesa

AZ

7

4

Fresno

CA

7

5

Arlington

TX

8

Top Five Cities Where Renting is Cheaper than Buying

#

City

State

Price:Rent Ratio

1

New York

NY

36

2

Fort Worth

TX

32

3

Omaha

NE

27

4

Seattle

WA

24

5

San Francisco

CA

24

NOTE: The price-to-rent ratio is the median listing price divided by the annualized median rent. Ratios that are 15 and under indicate buying is less expensive than renting, while ratios that are 20 or higher indicate renting is less expensive than buying.

 

Housing Market Rebounds and Setbacks in Foreclosure Hotspots

Buying a home in cities flooded with foreclosures continues to be considerably cheaper than renting, but this may be poised to change in the coming months. In Miami, for example, it is still less expensive to buy, but a mini-buying boom created by foreign investors and foreclosure freezes have caused its price-to-rent ratio to jump by 112 percent from 6 in January to 13 in July. Meanwhile, recent job gains in the auto industry have not countered Detroit’s falling home prices. For now, the city has experienced a setback since January with its price-to-rent ratio dipping 39 percent. Las Vegas, on the other hand, continues to be the best place to buy instead of rent for the past six months.

#

City

State

Price:Rent Ratio

July 2011

Price:Rent Ratio

January 2011

% Change

1

Miami

FL

13

6

112%

2

Phoenix

AZ

8

8

1%

3

Las Vegas

NV

6

6

-7%

4

Tucson

AZ

13

14

-10%

5

Mesa

AZ

7

8

-11%

6

Sacramento

CA

8

13

-17%

7

Fresno

CA

7

11

-32%

8

Detroit

MI

7

12

-39%

PRE-APPROVED QUOTES

  • “While recent stock market volatility on top of the slow economic recovery makes homebuyers nervous, it has not destroyed the American dream of homeownership. However, prospective homebuyers, who are ready and qualified to buy, face an uphill battle despite falling home prices and record-low mortgage rates,” said Ken Shuman, Head of Communications at Trulia. “Today, many banks are actually less enthusiastic about approving residential mortgage applications, which has dragged out the home buying process. Until a middle ground on lending practices can be met, many highly-qualified buyers may be forced to be renters by choice for now.”

  • “Many aspiring homeowners are on the fence about renting and buying in today’s market. Should they take advantage of falling home prices and low borrowing costs, or should they continue to rent until the economy stabilizes?” said Ken Shuman, Head of Communications at Trulia. “Price alone should never be the sole factor in deciding to purchase a home. Instead, buyers should first ask themselves if they plan to live in the home for at least seven-to-10 years, could make monthly payments on the house, and have enough cash in the bank for a down payment and an additional six to eight months worth of mortgage payments. If you can answer ‘yes’ to each of these questions, then the cost of buying a home definitely outweighs renting in most cities.”

 

METHODOLOGY
Trulia calculated the price-to-rent ratios for the 50 largest U.S. cities using the median list price compared with the median rent on two-bedroom apartments, condominiums and townhomes listed on Trulia.com as of July 1, 2011. To view the complete methodology including sample price-to-rent ratio calculation, interpretation key for the ratio and definitions, click
here.

 

The Mortgage Solutions Team in Utah has that resources you need to get you the very best Mortgage Programs and lowest  Mortgage Rate available. If you are looking to Purchase a home or Refinance your existing home, give us a call. We work one on one with our clients and tailor a mortgage program to fit your needs. We create solutions for all your Mortgage needs.

 

 

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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Utah Mortgage Rates Hit Record Lows….. Actual Record Lows, not just the fluff you’ve heard on the T.V. and Radio for the past 4 years either.

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I saw this article on KSL.com and had to share with you. The average rate on a 30-year fixed mortgage has fallen to its lowest level on records dating to 1971.

The rate on the most popular mortgage dipped to 4.15 percent from 4.32 percent a week ago, Freddie Mac said Thursday. Its previous low of 4.17 percent was reached in November.

The last time long-term rates were lower was in the 1950s, when 30-year loans weren’t widely available. Most long-term home loans lasted 20 or 25 years.

Few expect record-low rates to energize the depressed home market. Over the past year, the average rate on the 30-year fixed mortgage has been below 5 percent for all but two weeks. Yet prices and sales remain unhealthy and are holding back the overall economy.

Five years ago, the average 30-year fixed rate was near 6.5 percent. In 2000, it exceeded 8 percent.

Most homeowners are paying rates more than a full percentage point higher than the current average. The average rate on all outstanding mortgages is 5.3 percent, Freddie Mac said, citing data from the Bureau of Economic Analysis.

After previous recessions, housing accounted for 15 percent to 20 percent of overall economic growth. This time, in 2009 and 2010, housing contributed just 4 percent to the economy.

“The housing market is not going to turn around because of this, because it isn’t the mortgage rate that matters,” said Joel Naroff, head of Naroff Economic Advisors. Naroff blamed the “horrendous” process of qualifying for a mortgage despite tougher lending standards. He said trying to sell a home in many markets is just as difficult.

Many would-be buyers can’t take advantage of the low rates. The unemployment rate is 9.1 percent, few Americans are getting raises and many are struggling to shrink their debt loads.

Banks are also insisting on higher credit scores and larger down payments for first-time buyers. Many repeat buyers have too little equity invested in their homes to qualify for loans. Others are too nervous about the economy or their job security to invest in a home.

The average rate on a 15-year fixed mortgage, which is popular for refinancing, fell to 3.36 percent, also a record low. It’s the third straight week of record lows for the popular refinancing option. Freddie Mac’s records date to 1991, but analysts believe the new low on the 15-year mortgage is the lowest ever.

Borrowers who qualify have rushed to refinance and take advantage of the low rates. Refinancing accounted for 70 percent of mortgage applications in the first half of the year, Freddie Mac said. Refinances  tend to provide less benefit to the economy than home purchases do.

Mortgage rates typically track the yield on the 10-year Treasury note. Economic fears have drawn investors to the safety of Treasuries, driving down the yield on the 10-year note to barely above 2 percent. That has helped lower mortgage rates.

The Federal Reserve offered a dim outlook of the economy last week, saying it expects growth will stay weak for two more years. As a result, the Fed said it expects to keep short-term rates near zero through mid-2013.

Roughly 14 million Americans remain unemployed. And the economy isn’t creating enough jobs to rapidly trim that figure. The economy grew at an annual rate of just 0.8 percent in the first six months of this year, the slowest such pace since the recession officially ended more than two years ago. In June, consumers cut spending for the first time in 20 months.

Fewer Americans bought previously occupied homes in July for the third time in four months, the National Association of Realtors said Thursday in a separate report. It said sales fell 3.5 percent last month to a seasonally adjusted annual rate of 4.67 million homes. That’s far below the 6 million that economists say must be sold to sustain a healthy housing market.

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

The average rate on a five-year adjustable-rate mortgage fell to 3.08 percent, its lowest level on records dating to January 2005. Last week’s reading of 3.13 percent also was a record low. The week before was, too.

The average for one-year adjustable-rate loans fell to 2.86 percent, the lowest on records going back to 1984. Last week’s average of 2.89 also set a record.

As always, for questions regarding mortgage refinances and home loan purchases in Utah give the Mortgage Solutions Team a call. We offer mortgage advice and free mortgage rate quotes.

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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European Banking Crisis Spilling Over?

Face it: there is no quick fix for the problems in Europe, or in United States. The situation in Europe is worsening, and the fear that sovereign debt would spread has done just that: French, German, and Spanish banks are now viewed as vulnerable since they hold a good amount of poor European debt from Greece, Italy, Spain, Portugal, and Ireland. Germany and Holland can’t save the rest of Europe. German Chancellor Angela Merkel and French President Nicolas Sarkozy said they will encourage euro-zone nations to more closely integrate their economies, proposing stricter oversight and deficit rules to tackle the sovereign-debt crisis. The leaders rejected the idea of expanding the region’s rescue fund or introducing Eurobonds.

Do the problems over there influence our mortgage rates? Well, to be concise and simplistic, European concerns have not pushed our rates higher, and in fact, in a roundabout way, have helped to push US Treasury debt rates lower, and mortgages along with them. But analysts are quick to point out that the trouble there is likely to spread to other economies, especially if austerity measures are implemented. And great rates are only part of the lending picture – the borrower and the property still have to qualify.

And the problems there certainly, in the long run, overshadow “small” economic news releases here, although measures of our economy certainly move rates in the short run. Yesterday we had some import & export price numbers, along with housing starts and building permits, and then Industrial Production (+.9% in July, the quickest pace in seven months) and Capacity Utilization (which rose to 77.5% from a revised 76.9% in June). But stocks dropped on disappointment in the results of Merkel-Sarkozy talks, and bonds rallied. 

In mortgages , traders reported “a big migration” in MBS investors as they sold higher coupon securities and bought lower coupon bonds. Selling from originators totaled around $1.7 billion and consisted of 75% in 4% coupons and 25% in 3.5%’s. (And there are now actually prices on 30-yr 3% coupons, containing 3.25-3.625% 30-yr mortgages!) MBS prices improved by roughly .5 on current-coupon production, resulting in some intra-day price changes from lenders. But it is a big concern for lenders to close the loans that are locked in their pipelines, and following market price changes does not seem to be paramount.

This morning we learned from the MBA that last week’s applications were almost 79% refinances  – not a shock. Overall apps were up about 4%, but while refi’s were up 8% purchase apps dropped over 9%. Much of the slicing and dicing done by mortgage research firms suggest that while supply and prepay risk is increasing, it looks to be “contained”, unless the government comes up with some program to stimulate the housing market which odds are deemed very low of this occurring. We also have the Producer Price Index numbers, but currently the 10-yr sitting around 2.24% and MBS prices worse by about .125.

Whether you are a Real Estate Professional, Home Buyer or someone looking to Purchase a home down the road, the Mortgage Solutions Team can help you achieve your goals. Give us a call today!

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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www.mymtgsolution.com
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Loan Modifications just not Happening for Homeowners, there are Alternatives Available

loan-officer-couple1

Posted by Bud Bruening

Wednesday, August 10th, 2011, 12:52 pm

The mortgage industry completed 558,000 mortgage modifications in the first six months of 2011, down 42% from the same period one year ago, according to the Hope Now alliance of servicers, investors and counselors.

Nearly two-thirds of the workouts came through private programs, totaling 375,000 compared to the roughly 183,000 under the Home Affordable Modification Program. Private mods dropped 41% from last year, while HAMP modifications fell 45%.

However, the amount of delinquent homeowners showed a decline. There were 2.7 million homeowners in 60-day delinquency or worse in the first half of 2011, down 27% from the same period last year, according to Hope Now.

Foreclosure sales dropped 25% to roughly 432,000 in 2011, and foreclosure starts decreased 9% to 1.13 million.

With sales and starts combined, the amount of foreclosures is 1.5 million, nearly three times more than the 558,000 modifications completed in the first half of the year.

Much of the slowdown in foreclosures stems from self-imposed delays due to documentation problems. In its second-quarter financial filing, Freddie Mac pointed out it took an average of 500 days to complete a foreclosure, up from 451 days last year. This, Freddie said, was hampering mortgage holders’ ability to shed these assets in a timely manner.

Faith Schwartz, the Hope Now executive director said the decrease shows more homeowners are receiving assistance.

“There were 1 million less delinquent homeowners in the first half of 2011 than there were for the same time period last year,” Schwartz said. “The decrease in delinquencies combined with the drop in foreclosure starts and sales shows that more homeowners are getting assistance through the many options available to them.”

There are many options for those looking to lower their rate. Loan Modifications are not happening like they were years ago. There are mortgage programs available if you are upside down on your mortgage or have less than perfect credit. If you have been on the fence about refinancing or buying, now is the time to make the call. We would love to help you take advantage and get a great mortgage.

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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New Push for REO Rentals Coming!!

Posted by Bud Bruening

The Obama administration will begin working on new strategies for how to better sell previously foreclosed homes held by Fannie Mae, Freddie Mac  and the Federal Housing Administration, which may include renting more REO.

The Federal Housing Finance Agency, the Treasury Department and the Department of Housing and Urban Development put out a request for information, seeking new ideas from market participants for selling REO. Currently, the government owns roughly half of the REO inventory in the U.S.

The agencies called on private property managers to submit ideas on how to reduce the REO portfolios at the GSEs and the FHA in a cost-effective manner. They also seek new ideas on property repair, sales strategies in specific hard-hit areas and new analysis of when to sell or even rent these properties.

There are 92,000 properties currently for sale from HUD, Fannie and Freddie. Inventory is different as many properties are held up and not currently on the market due to delays in the process or state and federal regulations. Fannie Mae held 135,719 REO properties at the end of the second quarter, and Freddie held an inventory of roughly 61,000 REO.

The agencies said there could be new programs developed for allowing the previous owner to rent the home or to allow current renters to become owners. They are also looking for private holders of REO to partner with the government in the effort.

Sen. Jack Reed (D-R.I.) recently sent a letter to the FHFA, urging the Fannie and Freddie to convert their repossessed properties into rental units and pool them for sales to investors.

“FHFA, Treasury and HUD anticipate respondents may best address these objectives through REO to rental structures, but respondents are encouraged to propose strategies they believe best accomplish the objectives,” the agencies said.

FHFA Acting Director Edward DeMarco said Fannie and Freddie will continue marketing individual REO for sale, but they will also look at possibly pooling these properties in some areas to reduce credit losses and stabilize neighborhoods.

“Partnerships involving enterprise properties may reduce taxpayer losses and meet the enterprises’ responsibility to bring stability and liquidity to housing markets. We seek input on these important questions,” DeMarco said.

Treasury Secretary Timothy Geithner said solving glut of REO on the market is crucial to repairing housing finance overall.

“Exploring new options for selling these foreclosed properties will help expand access to affordable rental housing, promote private investment in local housing markets, and support neighborhood and home price stability,” Geithner said.

HUD Secretary Shaun Donovan said millions of families, who have struggled to maintain their monthly payments, have seen the value of their home drop because of abandoned properties.

“At the same time, with half of all renters spending more than a third of their income on housing and a quarter spending more than half, we have to find and promote new ways to alleviate the strain on the affordable rental market,” Donovan said. “Taking steps to encourage private investment in REO properties and transition them into productive use will help stabilize neighborhoods and home values at a critical time for our economy.”

 

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
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Analysts expect mortgage rates to remain low for time being

Posted by Bud Bruening Tuesday, August 9th,
Analysts expect mortgage rates are likely to remain low as long as the U.S. is battling a sluggish economy, but the nation could see a slight uptick in rates if Treasury yields edge higher, according to one financial analyst. Greg McBride said it’s unlikely mortgage rates will be an impediment for well-qualified borrowers, because the “weak economy will keep a lid on mortgage rates.” “Mortgage rates are well below 5%. Even with the downgrade, I expect mortgage rates are going to stay below 5% as long as everyone is consumed by economic worries,” he said.

While Standard and Poor’s downgrade of the U.S. debt rating riled financial markets Monday, McBride said mortgage rates are effected more by the overall health of the economy, which is in a state of distress over weak employment data and abysmal consumer confidence. “The downgrade didn’t tell us anything we didn’t already know, we’ve had a barrage of poor economic data and that’s really put the economy front and center,” McBride said.

Mortgage Rates continue to remain at very low levels with all of the poor economic news this week. If you are upside down on your home, have less than perfect credit, there are still options available. Mortgage rates are being driven by all the poor economic news but are also affected by economic speculation. Any news both positive or negative could have a direct impact on your mortgage rate. To ensure that you get the very best mortgage rate in Utah, give the Mortgage Solutions Team a call. We are a local Utah Mortgage company offering free mortgage rate quotes and other valuable Utah mortgage information. Give us a call to find out what we can do do for you.

Bud Bruening
512 E. Winchester
Murray, Utah 84017
Ph. 801.716.5246
Cell. 801.230.3107
Like us on Facebook
Follow me on Twitter
www.mymtgsolution.com
Utah’s Lowest Mortgage Rates

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