Mortgage Market Update

Freddie Mac surveys mortgage lenders every week, compiling the results in a report they call the Primary Mortgage Market Survey (PMMS).  Here are last week’s results with a comparison to the previous week.

30 Year Fixed mortgages came in at 4.20% with 0.6 points.  This was a mere 0.01% lower than the previous week with no change in points.

15 Year Fixed mortgages came in at 3.29% with 0.6 points, 0.03% lower than the previous week with no change in points.

5 Year ARMs came in at 3.01% with 0.4 points.  The prior week was at 3.05% with 0.5 points.

1 Year ARMs came in at 2.43% with 0.5 points, the rate unchanging from the prior week but points actually being higher by 0.1.

Mortgage Market Update

Here are the week’s rates and notes for our Edmond, Oklahoma friends and family courtesy of Freddie Mac:

30-year fixed-rate mortgage (FRM) averaged 4.32 percent with an average 0.6 points at the end of the day March 20, 2014, down from last week when it averaged 4.37 percent.  Points remain unchanged.

15-year FRM this week averaged 3.32 percent with an average 0.6 point, down from last week when it averaged 3.38 percent.  Points remain unchanged.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.02 percent this week with an average 0.4 point, down from last week when it averaged 3.09 percent.  Points again were unchanged.

1-year Treasury-indexed ARM averaged 2.49 percent this week with an average 0.4 point, up slightly from last week when it averaged 2.48 percent.  Points were unchanged.

How the New QM Mortgage Rules Affect Borrowers

A new set of rules went into effect at the beginning of the year from the Consumer Financial Protection Bureau aimed at ensuring consumers obtain sustainable loans and keep banks from making questionable loans to unqualified borrowers.  These new rules known as the QM regulations (short for Quality Mortgage Regulations) are in response to the recent housing and financial crisis.

As a potential Edmond, Oklahoma borrower applying for a mortgage loan your total monthly debt payments must be at 43% or lower of your monthly income.  Secondly, lenders are capped at 3% for lender fees on the loans they provide.  By sticking to these two standards a loan earns the QM designation, which means the loan can then be purchased or guaranteed by Freddie Mac or Fannie Mae.  Bottom line, QM loans backed by Freddie or Fannie bring legal protection for the lender against future lawsuits by borrowers or investors.

That’s not to say lenders do not have non-QM loans available.  With the new regulations the onus is still on the bank to complete their due diligence, ensuring borrowers have the ability to repay the loan, but the non-QM loans will not receive the same legal protection as the QM loans.

What does all this mean to you?  Much of the flexibility lenders had in the past is now gone.  Many banks have already gotten rid of quite a few of their mortgage products in the wake of the crisis like the no-documentation loans, interest only, and negatively amortizing loans.  These new regulations are more likely to affect traditional borrowers in any of a number of ways.  An example would be a borrower with a healthy savings account, but who has lower monthly income because they are retired.  Likewise self-employed people may be evaluated under a more powerful magnifying glass as to their ability to repay as banks strive to toe that 43% debt to income ratio.

Mortgage Market Update and Notes

In the weeks after several economic reports including recent weaker housing data have been released we’re seeing mortgage rates down slightly pretty much across the board.  The only rate to inch up from the week previous was the 1 Year Treasury-Indexed ARM which had a negligible increase of 0.01%.  Here are the week’s rates and notes for our Edmond, Oklahoma friends and family courtesy of Marketwired and Freddie Mac:

30-year fixed-rate mortgage (FRM) averaged 4.32 percent with an average 0.7 point for the week ending January 30, 2014, down from last week when it averaged 4.39 percent. A year ago at this time, the 30-year FRM averaged 3.53 percent.

15-year FRM this week averaged 3.40 percent with an average 0.6 point, down from last week when it averaged 3.44 percent. A year ago at this time, the 15-year FRM averaged 2.81 percent.

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 3.12 percent this week with an average 0.5 point, down from last week when it averaged 3.15 percent. A year ago, the 5-year ARM averaged 2.70 percent

1-year Treasury-indexed ARM averaged 2.55 percent this week with an average 0.4 point, up from last week when it averaged 2.54 percent. At this time last year, the 1-year ARM averaged 2.59 percent.

Mortgage Market Update

This week’s Primary Mortgage Market Survey (PMMS) from Freddie Mac looks much like last week’s report:

30 year fixed rates came in at 4.51% with 0.7 points, down slightly from last week’s 4.53% with 0.8 points.

15 year fixed rates came in at 3.56% with 0.6 points, also varying only slightly from last week’s 3.55% and 0.7 points.

5 year ARMs came in at 3.15% with 0.4 points, down 0.10% from last week with no change in points.

1 year ARMS came in identical to the week previous at 2.56% with 0.5 points.

Mortgage Market Update

Here’s a quick mortgage market update for all our Edmond and Greater Oklahoma City friends and neighbors.

By the end of last week the national average for 30 Year Fixed rate mortgages was at 4.13% with 0.8 points.  The rate was 0.15% lower than the prior week, but 0.1 higher on points.

The 15 Year Fixed average rate was 3.24% with 0.6 points, 0.09% lower than the previous week, with points also lower by 0.1.

5 Year ARMs were at 3.0% with 0.4 points, down from 3.07% the previous week.  Points remained unchanged.

1 Year ARMs were at 2.6% with 0.5 points, down from 2.63 % the previous week.  Points were 0.1 higher.