At Quicken Loans we strive to make the closing of your mortgage as quick, easy, and effortless as possible. One way we make that happen is with our current closing process. After you’ve confirmed a date, time and selected a location of your choice, we will select one of our best notaries to meet you at that location for the signing. It may seem a little odd that we would send someone whom you’ve never met to sign all of these important documents, but we want to do everything in our power to ensure this is the most undemanding mortgage process ever. Even if it means coming to your home for the closing so you don’t have to get out of your pajamas. So to ease some of your apprehension about the notion of allowing a stranger in your space, let’s break this down and not only discuss the notary’s role in the transaction but also discuss the benefits of having one.

What Are Notaries and What Do they Do?

According to Merriam-Webster, a notary is “a public officer who certifies and attests to the authenticity of writing (e.g., deeds) and takes affidavits, depositions, and protests of negotiable instrument.” In layman’s terms, a notary is someone who is legally authorized to sign documents. Once the signing is complete, the notary will take the documents, place them in a UPS box along with the UPS label that we have provided for them and send them back to us to ensure that everything was signed properly before we shop them off to the county for recording. Without the notary’s stamp and signature, your documents aren’t considered valid, and your state won’t accept the documents once they are sent for recording. You would have to resign all the documentation again.

How We Select Our Notaries

Once you’ve completed the scheduling call and have secured your date and time, our sister company who handled all of the title work (Title Source) will reach out to one of their trusted vendors to find the person with the highest satisfaction rate in your area. In order to be considered for the position the potential notary must send in their W-9’s, a copy of their notaries commission (license), go through an extensive background check as well as send us their resume with three business referrals. Pretty thorough, right? Once the selection has been made, the notary will reach out to you to make an introduction before coming to your closing location.

Benefits of Notaries

Most notaries are mobile, which means although they don’t have an office where you can meet, they are able to travel and meet you almost wherever you want. As previously stated, most of our clients prefer to close in the comfort of their own home. However if you would like to meet at a coffee shop or a library, the notary will have no problem meeting you there. Another benefit of having a notary perform the closing is their ability to bring a witness should one be required to sign the mortgage. That’s right, depending on the state that you live in, you may be required to provide a witness and have them sign the mortgage. No worries, we’re able to help you with that. Once we schedule the closing, we’ll contact our notary team and have them assign a notary who will be able to bring a witness with them if needed. Just one less thing you have to worry about.

If you have any questions regarding notaries and their role in closing you home loan please let us know in the comment section below.

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The climb has begun. You may recall last week’s edition of the Primary Mortgage Market Survey which reported that after five weeks of declining mortgage rates, some to historically low amounts, rates had started to rise again. This week that trend continues as we see all four rates reported on by the PMMS report have risen. The report shows that this is a reflection of logical economic trends, which makes perfect sense, but I like to suspect other things at work. Witchcraft? Aliens living inside our stock market? A tear in the fabric of the space time continuum? Signs point towards falling household debt and more consumer spending, but I’ll cling to my conspiracy theories as long as I can. Regardless of what fan fiction you read, no one can doubt the raw numbers straight from Freddie Mac:

30-year fixed-rate mortgage (FRM) averaged 3.51% with an average 0.7 point for the week ending May 16, 2013, up from last week when it averaged 3.42%. Last year at this time, the 30-year FRM averaged 3.79%. 

15-year fixed-rate mortgage this week averaged 2.69% with an average 0.7 point, up from last week when it averaged 2.61%. A year ago at this time, the 15-year FRM averaged 3.04%. 

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.62% this week with an average 0.5 point, up from last week when it averaged 2.58%. A year ago, the 5-year ARM averaged 2.83%.

1-year Treasury-indexed adjustable-rate mortgage averaged 2.55% this week with an average 0.4 point, up from last week when it averaged 2.53%. At this time last year, the 1-year ARM averaged 2.78%. 

 You don’t have to believe me! I know the truth. There are plenty of supernatural enthusiasts that will support my theories, like Bigfoot caused the recession, and the Bermuda Triangle influences the Dow Jones Industrial Average. Don’t believe my obnoxious and unfounded theories? Read these two quotes from Frank Nothaft, vice president and chief economist of Freddie Mac:

“Mortgage rates followed U.S. Treasury bond yields higher this week on signs of stronger consumer spending. Advanced retail sales rose 0.1% in April, above the market forecast consensus of a 0.3% decline. Excluding such items as automobiles and gasoline, sales were up 0.5% for the second time in three months.

“Households are also shoring up their balance sheets. Total household debt fell by about $110 billion in the first quarter. In addition, approximately 3.0 million homeowners were seriously delinquent (90 days or more delinquent or in foreclosure) on their first mortgages, down from a peak of about 5.1 million in the fourth quarter of 2009.”

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I hate to sound like a telemarketer, but do you want to save money? If the answer is yes, then consider refinancing your mortgage today. It seems so elementary, I know. But I’ve been after my husband to refinance our property for about five months now, and trust me, tasks like this can slowly slip down your priority list.

Refinancing is high on my to-do list because a lower mortgage payment will ultimately help support our future financial goals, help pay down our debt and save money every month. But as the saying goes: Different strokes for different folks meaning everyone has their own reasons to refinance.

Most often, people seek a lower mortgage payment. Although it may only save $100 to $200 a month, the savings can equate to thousands over the life of your mortgage. The lower payment is the result of a lower interest rate. Current rates are hovering around 3.5% for a 30-year fixed mortgage. Locking in a lower interest rate is a smart way to ensure that your rate doesn’t increase. So if you’re currently at a higher rate, then a refi is definitely something worth considering.

Others look to refinance to cash out their home equity. Some seek cash for home improvements while others look to use the money to start a business or buy investment property. It’s also a good way to pay down high-interest debt. Despite your plans, there is value in your reason to cash out your equity. And refinancing makes that possible.

Another great reason to refi is to lock in a fixed rate if you currently have an adjustable-rate mortgage. Chances are your adjustable rate won’t stay low forever, so for some it’s a proactive move for the future.

If you think you can’t refi because you owe more than your home is worth, consider the Home Affordable Refinance Program (HARP) if:

• You purchased your home on or before May 31, 2009.
• Your current loan-to-value ratio is greater than 80%.
• You are current on your mortgage.
• Your mortgage is backed by Fannie Mae or Freddie Mac.
• You haven’t participated in HARP previously.

Tahnee Horne and her husband Shaun have lived in their Romulus, Mich., home for six years and they are currently looking into refinancing. Her sentiments summed this topic up nicely.

“It’s very simple; we just want a lower monthly payment. With a family of four, we can definitely find other ways to use that extra money every month,” Horne said.

If you can relate to her, then it may be time to act!

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Like a great sandwich, your favorite song, or the movie Space Jam, all good things must come to an end. After five weeks of reporting on dropping rates in the Primary Mortgage Market Survey, some to historic lows, rates have finally risen. 30 & 15-year fixed-rate mortgages, as well as 5-year adjustable-rate mortgages, are on the rise as we may have left the glory days that were the last five weeks. Don’t fret though, the ending of something good means the beginning of great new things; rates are still very low. How low, one might ask? Check out the raw numbers straight from Freddie Mac.

30-year fixed-rate mortgage (FRM) averaged 3.42% with an average 0.7 point for the week ending May 9, 2013, up from last week when it averaged 3.35%. Last year at this time, the 30-year FRM averaged 3.83%. 

 15-year FRM this week averaged 2.61% with an average 0.7 point, up from last week when it averaged 2.56%. A year ago at this time, the 15-year FRM averaged 3.05%. 

 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.58% this week with an average 0.5 point, up from last week when it averaged 2.56%. A year ago, the 5-year ARM averaged 2.81%.

 1-year Treasury-indexed ARM averaged 2.53 %this week with an average 0.4 point, down from last week when it averaged 2.56%. At this time last year, the 1-year ARM averaged 2.73%. 

 Like trying a meal you’ve never had before, your favorite band releasing a new album or watching Space Jam again, new beginnings happen all the time and should be embraced. That being said, seize these mortgage rates while you still can. As always, we leave you with a further explanation on fluctuating market rates from the Vice President and Chief Economist of Freddie Mac, Frank Nothaft:

“Fixed mortgage rates edged up following a solid employment report for April. The economy gained 165,000 new jobs on net last month, more than the market consensus forecast and the largest monthly increase this year. On top of that, revisions added 114,000 more jobs to February and March as well. All of these factors allowed the unemployment rate to fall to 7.5% in April, the lowest since December 2008.”

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American homeowners are in the midst of a hot and heavy love affair with low interest rates. But not every courtship has a happy ending.

As the final days of 2012 slipped away, Lisa Price made her client an o­ffer she thought he couldn’t refuse. Her client—we’ll call him John Doe—was paying a rate of 6.616% on his $435,000 mortgage, with 25 years left to go. Price, a mortgage banker for Quicken Loans, offered to refinance his loan at 4.125%, keeping the 25-year payout time. The deal would have knocked his monthly payments down to $3,383, a savings of $630 a month. Closing costs were minimal and would have been recouped through the savings within four months of signing. And with the streamlined process she proposed, it would have required very little paperwork and wasn’t contingent on any appraisal valuation. It seemed like a no-brainer. But John Doe said no thanks.

“It didn’t make any sense,” says a stunned Price, reflecting on the rejection. “Usually when I call someone with a deal like that they’re really excited.”

It’s typically pretty easy for mortgage brokers to give away money, and indeed, refinancing activity has skyrocketed as interest rates plummeted in recent years. The one group of homeowners who didn’t participate in the refi boom—those whose home prices tanked, leaving them without enough equity in their home to qualify for refinancing—are now eligible to restructure their loans thanks to a new government program. But as Quicken Loans and other mortgage originators have learned, it can be surprisingly difficult to persuade some of these people to take sweet deals like the one above, even when the government is greasing the skids.

The first government assistance programs after the housing bubble burst o­ffered to help homeowners only after they stopped paying their mortgages.  But a later program—the Home A­ffordable Refinance Program (HARP)—was designed specifically to help out those underwater homeowners still paying their mortgages on time by giving them access to the low rates so many others are enjoying. HARP has been refinanced several times since its inception in 2010, and every version of the plan has made it easier for homeowners to qualify. But getting the word out hasn’t been easy.

Quicken and other mortgage originators have aggressively tried to let homeowners who qualify know about the program. “We get their home number, the business number, their e-mail, we express mail packages to their house so it looks serious,” says Dan Gilbert, founder and chairman of Quicken Loans. “We leave messages; we tell them, ‘Go look up HARP on Google and you’ll see it’s real.’ We don’t quit.” And yet almost half of these homeowners don’t respond. “If you would have told me all the facts about how this works before, I would have predicted we’d get 80% to 85%,” Gilbert marvels.

Ultimately, Quicken says, only about 25% of the homeowners who qualify for HARP actually end up refinancing. And that’s the shame of it all. HARP is a smart program. It rewards good behavior—those who have continued to pay their mortgages—while lending a helping hand to those who could really use it. And it attempts to even the playing field by giving more Americans fair access to the low interest rates enjoyed by big businesses and the wealthy. This program is also good for the economy, as consumers spend much of the money they save on their mortgage payments.

So how do the government and mortgage originators convince the public to take advantage of a program that can truly help many who need it? It’s the classic lesson of once bitten, twice shy. Wounds from all those no-money-down loans and balloon payments have yet to heal for the homeowners bitten when the housing bubble burst. Others still feel the sting of paying hundreds for appraisals in an attempt to refinance, only to be spurned when their homes were valued at less than they owed on the mortgage. It may be hard for those consumers to trust again anytime soon. But for those with the courage to give it another go, love might actually be better the second time around.

Reprinted with permission – PARS International

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Quicken Loans isn’t the type of company to stop and pat itself on the back, toot its own horn, or relish in a victory lap. We do, however, like to tell people when we’ve got incredibly low mortgage rates that won’t be around forever. That’s the situation we’re in right now and the Zing blog would be at fault not to post something about it.

On Friday, Quicken Loans reached a milestone by hitting the lowest 15-year conventional rates that we’ve ever seen in our nearly 28-year history. As I am writing this, a 15-year fixed-rate loan is as low as 2.50% (2.911% APR); a rare opportunity that needs to be seized! If you follow the Primary Mortgage Monthly Survey as often as I do, you’ll know that rates have been creeping back down to record lows for a while now.

That was confirmed again when we saw our 30-year fixed-rate loans fall to as low as 3.375% (3.607% APR), matching our lowest 30-year rates we’ve ever had. However, when anything hits its lowest point, it can only rise, and these rates are going to climb higher in due time. So don’t get in a comfortable place, convincing yourself that you’ve got all the time in the world to get around to this deal. It’s not going to last forever, and just like we could never guarantee us hitting historic lows at any point, neither can we guarantee they’ll be here by the end of the week.

Regardless of how long it takes these rates to climb back up to less-affordable prices, you may remember a Zing post in February talking about the rise FHA insurance premiums. A window is closing soon for those of you who might be interested in an FHA loan at today’s incredible rates. Starting on June 3 of this year, mortgage insurance premiums (MIP) will need to be paid for a minimum of 11 years – that’s more than double from the original 5-year requirement. As a wise man once said, the choice is yours and yours alone, but if you’re seeking out a mortgage with an affordable rate and you don’t want to pay more insurance premiums, seek out one of these loans today.

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Currently mortgages are trending flat from where pricing was set yesterday morning. There are no major economic releases planned for today. When we look overseas, we are seeing a rally in European and Asian stocks.

What’s Up on Wall Street?

The Dow Jones Industrial Average decreased 62.01 points (-0.43) while the Nasdaq increased 6.36 points (0.20). Also, the S&P 500 rose 0.55 points (0.04).

Current Rates

Here are some of today’s rates:

• 30-Year Fixed: 3.50% (3.66% APR)
• 15-Year Fixed: 2.50% (2.911% APR)
• 7-Year ARM: 2.50% (2.946% APR)

Visit our mortgage rates page to find out how much you can save with today’s rates, or use our mortgage calculator to find more rates and loan options.

Financial Links

Here are a few links to some of today’s financial articles. Be sure to leave a comment below if you know of any additional financial articles that are trending today.

Reuters

Dow Opens Lower after Weak Results from GE, IBM

Bloomberg

New Households Created as U.S. Kids Leave Home: Cutting Research

HousingWire

Home Loan Servicing Solutions posts $24.8 million profit

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How does one express how low mortgage rates are getting these days? I mean we’ve been seeing for weeks now, via the Primary Mortgage Market Survey, that mortgage rates have been lowering inch by inch, but how can I explain it in the most appealing of terms?

If mortgage rates were in a limbo competition, they would have smoked the competition and pushed the concept of flexibility. If mortgage rates were a deep-sea diver, they would be frequenting the Titanic wreck. If mortgage rates were at an amusement park, they wouldn’t be able to ride any rollercoaster because they’re that low to the ground. If mortgage rates were your friend and you were in a heated argument with them, they’re so low they’d bring up your ex-girlfriend. The next time a rap song asks you to get low, you’re going to yell “LIKE, MORTGAGE RATES LOW?!” That’s how low they are. If you still don’t believe me, here are the raw numbers from Freddie Mac:

30-year fixed-rate mortgage (FRM) averaged 3.41% with an average 0.7 point for the week ending April 18, 2013, down from last week when it averaged 3.43%. Last year at this time, the 30-year FRM averaged 3.90%. 

 15-year FRM this week averaged 2.64% with an average 0.7 point, down from last week when it averaged 2.65%. A year ago at this time, the 15-year FRM averaged 3.13%. 

 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.60% this week with an average 0.5 point, down from last week when it averaged 2.62%. A year ago, the 5-year ARM averaged 2.78%.

 1-year Treasury-indexed ARM averaged 2.63% this week with an average 0.4 point, up from last week when it averaged 2.62%. At this time last year, the 1-year ARM averaged 2.81%. 

 So, if you’re a visual learner, look at the charts to see how low the rates are. Need some stats to prove how low mortgage rates are? Look at the italics above, or if you learn through over-dramatic metaphors, read the first paragraph again. If all of those fail you, and you need an in-depth analysis of how and why mortgage rates acted how they did this week, read this quote from Frank Nothaft, the vice president and chief economist of Freddie Mac.

“Mortgage rates nudged lower this week as consumer spending showed signs of weakness. Retail sales contracted for the second time in three months, falling 0.4 percent in March. In addition, the University of Michigan reported their Consumer Sentiment Index dropped 6.3 points in April to settle at 72.3, its lowest level since July. The April reading snapped a streak of three consecutive gains.”

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Getting your first mortgage can seem like an intricate and flustering process at first, much like a ballroom dance. At first step (like when you decided to buy a home) you may be heavy footed (confused) or new to this type of dance (naïve to the mortgage process), but so is everyone. After you get your first rehearsals in order (appraisals, credit score checked) you begin to get the feel of it. And while you may feel like you’re ready to hit the dance floor (buy a house; I hope we’re all following the metaphor now) there’s still other steps to learn (the topic of this week’s Know Your Mortgage. Just read on.) All confusing metaphors aside, it’s important you know what you’ll be paying for before you jump head first into a new home. That’s why this week we’re focusing on a vital part of the mortgage process: the Good Faith Estimate.

What Is a Good Faith Estimate?

A Good Faith Estimate (GFE) is a written form estimating the total settlement costs you’ll have to pay at the closing of your loan. It’s done to give the borrower a solid idea of what they will owe so they can prepare their expenses accordingly. It’s important to emphasize that the title describes it perfectly: an estimate. The cost may fluctuate for better or worse, but the difference from the actual costs will only be 10% of any third-party fees. The important part of the GFE shows you what the interest rates and closing costs will be so you have an opportunity to shop around for the plan that works best for you. GFE’s are required by law to be given within three days of applying for a loan by RESPA.

What’s RESPA?

RESPA stands for the Real Estate Settlement Procedures Act, which has been in effect since December, 1974. The bill was enacted to help curb shady kick-back practices done back in the day by some lenders. Another important part of RESPA is requiring lenders to provide GFE’s for potential borrowers. This made the process safer and easier for potential borrowers looking to start down the road to home ownership.

What Goes Into a Good Faith Estimate?

The good news is that no matter where you get your mortgage from, the GFE form will stay the same. The sheet itself and the information provided on it are based on HUD forms, so no lender gets special treatment. You can search online to find the information on a standardized template for a GFE form which typically includes  your estimated monthly payments, origination charges (charge for getting the loan to you) and settlement services (various insurance charges mostly). At the end of this three-page document, you’ll get your total estimated settlement charges, and a lovely estimate of your closing costs.

What’s Stopping My Estimate from Getting More Expensive?

Again, RESPA has got you covered here. Different sections of your GFE have different tolerance levels given to them, as in how much the estimate can fluctuate before the lender has to cover the difference in the estimate (if any). Some things have 0% tolerance (like your origination charge) and the lender must cover any difference in price; others have a 10% tolerance (like title insurance and services) and can increase up to 10% before the lender must cover the difference. Finally, some things have no tolerance (like initial deposit for escrow or homeowner’s insurance) and can change at settlement. All of the tolerance percentages and what payments fall under which categories are all available online.

So, if a mortgage is a ballroom dance, consider your Good Faith Estimate the helpful instructor (albeit, government mandated ballroom dance instructor). If you have any lingering questions or confusion on the ins and outs of a Good Faith Estimate, please comment below.

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You read that title correctly.

An estimated 2.7 million American households could refinance to today’s mortgage rates (which are at historic lows, in case you haven’t been paying attention) through the gov’s HARP program. And they can do it even if they owe more money than their home is worth. Up to 200%. But they aren’t. And we don’t know why.

Why don’t they want to lower their mortgage payment?

Why don’t they want to shorten the term of their loan?

Why don’t they want to save thousands in mortgage interest?

We wish we knew, because then we could reach out to them and explain why they absolutely should take advantage of HARP while it’s still around. Which brings up some good news for American homeowners. HARP has been extended through 2015. That’s a good thing. The bad thing is that mortgage rates most likely won’t stay as low as they are for very long. At some point, once rates rise, the ability to save money with HARP may be diminished.

Jordan Fylonenko (who sits a few seats over from me on the 12th floor of the Compuware Building in downtown Detroit) recently met with Quicken Loans Chief Economist Bob Walters to discuss HARP and what’s going on with the millions of folks who haven’t taken advantage of it.

Before we show you the video, here’s some info on HARP from our Press Room:

The FHFA’s announcement to extend the HARP deadline to 2015 is much needed for the estimated 2.7 million underwater homeowners who are eligible and still able to benefit by refinancing. Unfortunately, a too-good-to-be-true perception coupled with long lines to refinance and repeated “no’s” from lenders who are not utilizing HARP to its fullest extent have left many disgruntled to enter another arduous loan process. But for those homeowners needing a personal stimulus, picking up the phone again is well worth it.

The average savings from a HARP refinance is around $200 a month with an average rate reduction of 1.75%, resulting in $2,400 savings per closed loan per year and $74,000 per lifetime (assuming a 30-year mortgage). The potential stimulus for the economy is even more significant, reaching up to $6.5 billion ($2,400 in savings a year per consumer x 2.7 million consumers).

These savings are more than just numbers on a spreadsheet. A Quicken Loans client and active duty Air Force recruiter from Sacramento, CA, was able to cut $763 off his monthly payment for his investment property and lowered his rate down by more than a point through HARP. This was after his original lender told him they couldn’t help.

Another Quicken Loans HARP client from North Brunswick, NJ, was able to save $387 on his monthly payment and lower his rate by more than a point to 3.85%.

In a monthly video series, Markets and Musings, Quicken Loans Chief Economist sat down to discuss some of the recent changes that have opened up HARP to more underwater homeowners.

That’s it. Here’s the video. Enjoy and let us know what you think. And, of course, get HARPed if you haven’t already.

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