Mortgage Updates

Last Tuesday The Federal Reserve set a bench mark of 5.25% for the Federal Funds rate. By Friday, due largely to the credit "crisis" that rate had ticked up to 6.00%.  To bring the rate back down the FED infused the credit markets with 38 Billion dollars.  The Federal funds rate influences consumer and business loans. This infusion from the Feds was the largest since the 9/11 terrorist attacks, which speaks volumes about the FED's wish to ease market worries following the melt down in the mortgage markets.

How does this potentially your outlook for a mortgage?  Well, that depends.  If your credit is poor and you need a sub prime loan you may have trouble finding one, especially if you are looking for a high loan-to-value. (Low or no downpayment.)  The interest rates have also increased for these loan products. 

If your financing includes a loan which exceeds $417,000 (Fannie max loan amount) you can expect the rate to be higher and IF you are self employed and using "stated" income expect another bump in rate.

Speaking of rate "bumps"... getting the rate quote isn't as easy as it used to be.  Lenders now have to "price" based on any number of things... including credit scores; loan-to-value; occupancy; impounds or not, amortization, and CLTV to name a few.

Your questions and comments are welcome.