Dennis' Mortgage Blog

Question of the week:  No question this week, I know you want to get out of the office early today and not spend a lot of time reading my fascinating and informative mortgage question and answer!                       

Have a question?  Ask me!

Quick hits on the economy.  Despite the holiday atmosphere and an early Friday for most the economy keeps going and we had a lot of news this week:

            GDP the third revision of 3^rd Quarter GDP showed only 1.8% growth, down from 2.0%

            Unemployment initial filings down for the fourth week in a row to 364,000

Home sales revised down 14% for prior five years, up slightly in November and median prices up 2.1% for November

Sentiment increased in December to 69.6% from 64.1% in November

Personal Income and Spending both up 0.1% in November, however the increase in income was due to increase rental and dividend income and decline in payroll taxes; wages and salaries dropped 0.1% for the month

Overall the economy is doing a bit better, teeny bit, as we close out the year.  Following the reports for the 2^nd and 3^rd quarters the news is better than I would have anticipated in September and October.  The news is also such so as to keep the Fed on its course to maintain near zero interest rates for some time.  On this note the Fed reported yesterday it anticipates retaining low rates through 2014 and perhaps beyond.  This is very good news for those with large balances on Home Equity Lines of Credit tied to the Prime Rate.

Editorial gets it right.  The Wall Street Journal had an editorial yesterday encouraging the Securities and Exchange Commission to vigorously pursue its lawsuit against several former executives at Fannie Mae and Freddie Mac.  If you are interested here is link to my post on the issue.

Rates for Friday December 23, 2011: Mortgage rates bounced off their all-time lows this week, mostly on technical trading the past few days and a big sell off today before the holiday.  This time of year trading gets very choppy and it can be hard to read direction, in choppy markets always lock to protect yourself.  We are 1% lower on conventional rates from last Christmas and 0.75% lower on government.

FIXED RATE MORTGAGES AT COST OF 1.25 POINTS

30 year conforming                               3.75%               Up 0.125%

30 year high-balance conforming           4.00%               Up 0.125%

30 year FHA*                                                   3.75%               Flat

30 year FHA high-balance*                   3.75%               Flat

Please note that these are base rates and adjustments may be added for condominiums, refinances, credit scores, loan to value, no impound account and period rate is locked.  Rates are based on 20% down (3.5% for FHA)  with 740 FICO score for purchase mortgages.

* Current rates include credit towards closing costs, call for quote on rate and credit.

Whether you celebrate Christmas, Hanukkah or nothing at all I extend the blessings of the season to you and your family, hoping your homes are filled with laughter as your family gathers at this special time of year.

Merry Christmas from all the Smith’s and the Stratis family,

Dennis