Mortgage applications for refinances and purchases increased, likely due to the Federal Reserve raising rates last week for the 15th time in a row. Homeowners with adjustable rate mortgages that will soon adjust are encouraged to seek long-term fixed-rate mortgages to avoid significantly higher rates.
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Fed Raises Rates for 15th Time in a Row
Fed Chairman Ben Bernanke has raised the Fed Funds rate for the 15th time in a row since the Fed began raising rates in mid-2004. Is the Fed going too far by continuing to raise rates? Does this mean a recession for the economy?
Long-Term Rates Still Drawing People to DisARM
The Federal Reserve raised rates for the 15th time in a row, indicating it might not stop there. However, people in adjustable rate mortgages are becoming even more motivated to refinance out of their ARMs and into long-term fixed-rate mortgages.
Yield Curve Narrows, Applications for Mortgages Remain Steady
The number of applications for mortgages remained steady last week, even though the yield curve, or gap between short- and long-term rates, narrowed. Employment is expected to report strong numbers which could drive up rates. Homeowners' solution to this is to switch from adjustable to fixed-rate mortgages.
New Home Construction Increase Is Strongest in 30 Years
The amount of new home construction rose to its highest level in more than 30 years. Long-term rates continue to be low and job market is still stable. Both are fueling the housing market to remain strong and steady.
Possibility of Inverted Yield Curve Equals More Refinancing
The market is facing a possibility of a recession and is watching closely as short-term interest rates continue to get closer to long-term rates. The closer the two rates come together, the more people with adjustable rate mortgages are refinancing into fixed-rate mortgages.
After Market-Moving Week, Move to Fixed Rate Mortgages Intensifies
Applications for home purchases decreased somewhat from last week after a heavy week of market-moving news. But despite all the economic reports that were expected to change people's reaction to the housing market, long-term rates remain steady and more people continue the move from ARMs to fixed-rate mortgages.
Fed Raises Short-Term Rates, Purchases Fall
The number of applications for home purchases fell last week, perhaps in anticipation. However, refinances remained stable. Now that the Federal Reserve raised short-term interest rates, how will the market react and what does it think the new Fed Chief will do?
What Are Pre-Payment Penalties?
Some borrowers find themselves in a situation where they have to pay off their mortgage earlier than originally expected. They're surprised to find that they have to pay what's known as a pre-payment penalty, which can be thousands of dollars. What is a pre-payment penalty and when do you have to pay it?
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