I’m usually not a fan of rushing into big decisions. But under the circumstances, I’d say hurry up! The Federal Housing Administration’s (FHA) fast-approaching changes on mortgage insurance will surely result in a heftier price tag for new home buyers and refinancers come June 3.

In a nutshell, the majority of homebuyers will have to pay mortgage insurance for 11 years or for the life of their loan, unless they can make a down payment of more than 10% upfront. Since a lot of folks don’t fully understand the world of mortgage insurance, let’s break this down. This means FHA is revamping its Annual MIP Cancellation Policy so some people will lose the right to cancel their annual mortgage insurance premium (MIP). And if you have the cash to front the 10% payment, we’re talkin’ 15,000 big ones for a $150,000 home.

“Today, when you get an FHA loan, you pay MIP as part of your monthly payment for 5 years, or until 78% LTV, whichever is longer. The change they’re making will now require MIP to be paid for 11 years if your original LTV is 90% or lower and for the life of the loan if you are over 90%,” said Bobbi MacPherson, a product manager for Quicken Loans. “This will be a very difficult change for consumers to see. It won’t affect qualifying or the payment like the first change, this change will only be seen by comparing the APR on loans. Most consumers have a hard time understanding APR and won’t see the change easily.”

MacPherson went on to say, “Maybe more important is that it also affects clients on a 15-year loan because today, a client with an LTV under 78% has no MIP on an FHA loan.”

Another change is, if you want to refinance or get a jumbo loan (which exceeds $625,500) then your loan will be subject to a MIP surcharge of 5% of the home value. This is up from the previous amount of 3.5%.

These changes are on top of the FHA’s tightened lending standards and increased MIP that took effect on April 1. This marked FHA’s seventh mortgage insurance hike in five years.

These increases are the result of a staggering $16.3 billion deficit of FHA’s Mutual Mortgage Insurance Fund for the fiscal year 2013. This fund is used to finance homeowner programs.

How can home buyers and refinancers protect themselves from the new rules? If you can’t beat the June 3 deadline, consider a non-FHA loan option.

Perhaps the change will result in a spike in conventional and VA loans. Some benefits of conventional loans include that they generally require fewer hurdles and sometimes take less time to close. And although conventional loans generally require larger down payments, home equity can build up faster. VA loans are offered to home buyers who have served in the U.S. military or who are on active duty. A big VA loan benefit is that veterans can purchase a home with no money down as long as the home price doesn’t exceed the appraised value of the property and the seller is willing to pay the closing costs.

So consider all of your financing options or just start saving your dollars today!

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Week Five: The mortgage rates will not stop lowering. Since last week’s historic lows mentioned in the weekly Primary Mortgage Market Survey, Quicken Loans employees have been working tirelessly to let the people know that now is the time to lock in these historic rates. A work flow was established, and we all felt pretty good about it. Then, just today, the news came out again, and we all lost it: mortgage rates have dropped again, and 15-year fixed-rate mortgages have reached an all-time low for the second week in row. The people must know, and we’re working tooth and nail to get this done. This is the last log entry until the word is spread; here are the raw numbers from Freddie Mac:

30-year fixed-rate mortgage (FRM) averaged 3.35% with an average 0.7 point for the week ending May 2, 2013, down from last week when it averaged 3.40%. Last year at this time, the 30-year FRM averaged 3.84%. 

15-year fixed-rate mortgage this week averaged 2.56% with an average 0.7 point, down from last week when it averaged 2.61%. A year ago at this time, the 15-year FRM averaged 3.07%. 

5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.56% this week with an average 0.5 point, down from last week when it averaged 2.58%. A year ago, the 5-year ARM averaged 2.85%.

1-year Treasury-indexed ARM averaged 2.56% this week with an average 0.3 point, down from last week when it averaged 2.62%. At this time last year, the 1-year ARM averaged 2.70%. 

 Week Five, Part Two: That last statement was a bit of an overreaction. The PMMS report will be here every Thursday regardless of how tirelessly we tell you all about how affordable mortgage rates are. As always, we close the report with a quote from Frank Nothaft, vice president and chief economist of Freddie Mac, giving his thoughts on this week’s changes in mortgage rates.

“Mortgage rates eased somewhat following the release of the advance estimate of real GDP growth for the first quarter of the year, which rose 2.5 percent but fell short of the market consensus forecast. The latest GDP report confirmed that the housing sector has become an important contributor to the economic recovery. Residential fixed investment added to overall economic growth over the past eight consecutive quarters and contributed more than 0.3 percentage points in growth over the first three months of this year. Moreover, near record low mortgage rates should further drive the housing market recovery over the near term.”

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What a wild month for mortgage rates April has been. Like a backstabbing competitor on a reality show, mortgage rates have been going lower than anyone could have anticipated. You may have read a bevy of metaphors in last week’s Primary Mortgage Market Survey describing how low mortgage rates have become, but I had only scratched the surface. This week, 15-year fixed-rate mortgages and 5-year adjustable-rate mortgages hit record-breaking lows. How low, you ask? If these mortgage rates were fish in the ocean, they’d be low enough to be those creepy, transparent, bottom-dwelling fish you see in National Geographic once a year. If they were pants on a misguided youth, they would be below the knees. If these mortgage rates were a bomb shelter, they’d be so deep in the Earth no man-made bomb would make them even tremble. Before I go on too long of a rant here, read the raw numbers straight from Freddie Mac:

30-year fixed-rate mortgage averaged 3.40% with an average 0.8 point for the week ending April 25, 2013, down from last week when it averaged 3.41% percent. Last year at this time, the 30-year FRM averaged 3.88%. 

15-year fixed-rate mortgage this week averaged 2.61% with an average 0.7 point, down from last week when it averaged 2.64%. A year ago at this time, the 15-year FRM averaged 3.12%. 

5-year Treasury-indexed hybrid adjustable-rate mortgage averaged 2.58% this week with an average 0.5 point, down from last week when it averaged 2.60%. A year ago, the 5-year ARM averaged 2.85.

1-year Treasury-indexed adjustable rate mortgage averaged 2.62% this week with an average 0.3 point, down from last week when it averaged 2.63%. At this time last year, the 1-year ARM averaged 2.74%. 

 These numbers go beyond metaphors because, well, they’re real figures and not abstract, unnecessary metaphors. What also may be a better summary of how and why mortgage rates have fallen for four weeks in a row is an explanation from Frank Nothaft, VP and chief economist of Freddie Mac:

“The housing market is getting a boost with mortgage rates hovering at or near record lows. For instance, existing home sales averaged an annualized pace of 4.94 million over the first three months of this year, the most since the fourth quarter of 2009. More impressively, new home sales topped 424,000 during the first quarter, which was the strongest since the third quarter of 2008. The sales pickup is helping to support house-price gains. For instance, the Federal Housing Finance Agency reported that February marked the thirteenth consecutive month that it has recorded an annual rise in its U.S. house price index, which rose by 7.1 percent in the twelve months through February, the most since May 2006. Even with these gains, this U.S. index is still 13.6 percent below its peak set in April 2007.”

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Great article yesterday from FOX Business about  private mortgage insurance (PMI) and some very easy ways to avoid or eliminate it.

That’s good, because paying PMI can seem like throwing money down the drain. Often around $100 a month or so. And who likes that? The article features several quotes from none other than our own chief economist, the one and only, Bob Walters.

Just as a refresher, PMI is based on loan-to-value (LTV) and credit score (LTV is the amount of a loan divided by the value of the property – so a $100,000 loan on a $200,000 property would have an LTV of 50%, which is very good). The higher the LTV and the lower the credit score, the higher the PMI.

Here’s an example of how this works from the article:

According to Walters, the higher the loan-to-value and/or the lower the credit score, the higher the PMI amount. For example, if a borrower with a credit score of 680 takes out a $200,000 mortgage with a 90% loan-to-value ratio, he will pay $128 a month in PMI, Walters says, compared to $98 a month for a borrower with a 750 credit score.

It’s clear that everyone’s goal should be to pay as little PMI as possible and then do whatever is necessary to eliminate it forever. I mean, put your hand in your pocket right now. Do you have $128 in it? I don’t.

Here are the four ways Fox recommends eliminating PMI:

Wait Until Normal Amortization Pays It Down

One of the easiest and most straight forward ways to get rid of PMI is to pay the original balance below 78% of the value of the loan. Once 20% of the loan is paid off, the PMI should be removed, says Walters.

Get the Home Reappraised

“You have to work with the mortgage insurance company to get an appraiser approved by the insurance company and if the value is deemed below that 78% they can take it off,” says Walters.

Refinance Your Loan

Homeowners with a high interest rate and PMI on their mortgage might qualify for a mortgage refinance that could not only reduce their interest rate, but also eliminate PMI. (Refinancing is the Zing editor’s top choice!)

Opt for Lender Paid Mortgage Insurance

An alternative to PMI is lender paid mortgage insurance (or LPMI – go figure), which is when the lender agrees to waive the PMI mortgage insurance in exchange for the borrower paying a higher interest rate over the life of the loan. (Zing editor’s note: at Quicken Loans, we call LPMI our PMI Buster program. It can save you some dough).

LPMI is really a good option for many folks, especially with mortgage rates as low as they are today. Even if your rate is slightly higher to accommodate LPMI, it still could be extremely low and worthwhile. All you have to do is get in touch with us to find out.

That’s it. Read the full article here and, as always, let us know what you think.

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Welcome to the last Primary Mortgage Market Survey of the year. And fortunately for all you rate watchers, it ends on a good note! I know we’re all busy either getting caught back up with work after a few days off from the holiday or trying to dig our way out of snowpocalypse 2012! (Or in my case, trying to get caught up on work WHILE digging my way out of the mountains of Christmas gift trash cluttering up my house. Oh and the snowpocalyse…womp womp.)

So, without further ado, ladies and gentlemen, your PMMS report:

30-year fixed-rate mortgages dropped this week, reaching 3.35% with an average of 0.7 points. Last week they averaged 3.37%. While the decrease is slight, it’s still good news for you folks looking to refinance before the new year. Last year at this time, the 30-year fixed rate averaged 3.95%.

15-year fixed-rate mortgages actually stayed the same this week at 2.65% with an average of 0.7 points. Last year, the 15-year rate averaged 3.24%.

ARMs were a mixed bag again this week. The  5-year ARM averaged 2.70% with an average 0.7 points, down from last week when it averaged 2.71%. Meanwhile the 1-year ARM was at 2.56% this week with an average 0.5 points, up from last week when it averaged 2.52%. A year ago the 5-year ARM and the 1-year ARM averaged 2.88% and 2.78% respectively.

And now for the feature that doesn’t change, our weekly quote from Frank Nothaft, vice president and chief economist from Freddie Mac:

“Mortgage rates ended this year near record lows. The 30-year fixed-rate mortgage averaged 3.66 percent for 2012, the lowest annual average in at least 65 years. Rates on 30-year fixed mortgages were nearly 0.6 percentage points below that of the beginning of the year, which translates into an interest payment savings of nearly $98,600 over the life of a $200,000 loan. Moreover, opting for a 15-year fixed mortgage at today’s rates, a homeowner could save an additional $138,400 in interest payments.”

And that’s it for me! See you guys in 2013! Have a safe and happy New Year!

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Greek philosopher Heraclitus once said “the only constant is change.” As much as we would like things to remain the same – our babies to stay little, our waistlines to stay small, our mortgage rates to remain low – they never do, nor will. No matter how hard we try to stop it, time just keeps on slippin (slippin, slippin) into the future*, and mortgage rates keep on climbing.

This week’s Primary Mortgage Market Survey is out and rates are both higher and lower than last week. It just goes to show how quickly these crazy low rates can change. If you’re not refinancing into a lower rate, you may miss out on your opportunity. There is never going to be a better time, because tomorrow never comes.

So take a look and see how your existing rate compares:

30-year fixed-rate mortgages were on the rise this week, reaching 3.37% with an average of 0.7 points. You may remember last week they averaged 3.32%. While the increase is slight, it’s still on the upward trend. Last year at this time, the 30-year fixed rate averaged 3.91%

15-year fixed-rate mortgages actually dropped this week to 2.65% with an average of 0.7 points, down from last week when it averaged 2.66%. That’s good news for you if you’re looking to refinance into a shorter term loan!  Last year, the 15-year fixed rate averaged 3.21%

ARMs were a mixed bag again this week. The  5-year ARM averaged 2.71% with an average 0.7 points, up from last week when it averaged 2.70%. Meanwhile the 1-year ARM was at 2.52% this week with an average 0.4 points, down from last week when it averaged 2.53%. A year ago the 5-year ARM and the 1-year ARM averaged 2.85% and 2.77% respectively.

And now for the feature that doesn’t change, our weekly quote from Frank Nothaft, vice president and chief economist from Freddie Mac:

“Mortgage rates were mixed this week following data reports on stable inflation and a thriving home construction market. The 12-month growth in the core consumer price index has remained between 1.9 and 2.1 percent for the past five consecutive months ending in November. Meanwhile, housing starts averaged the strongest three months in November since September 2008, and homebuilder confidence rose in December to its highest reading since April 2008.”

*I apologize for the Steve Miller Band reference. I just couldn’t help myself.

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There are only a handful of things that can be measured in “record lows” – temperature, babies born, sea ice…um…oh, mortgage rates! Of course!

And this week, my friends, mortgage rates dropped! It wasn’t a dramatic drop by any means, but a drop is a drop and that means more money in your pocket. What are you waiting for? Check out this week’s Primary Mortgage Market Survey and see how your current rate compares.

If you don’t have a rate this low, then you know what? You’re missing out.

30-year fixed-rate mortgages fell to 3.32% with an average 0.7 point for the week ending December 6, 2012, down from last week when it averaged 3.34%. Last year at this time, the 30-year fixed rate averaged 3.94%.

15-year fixed-rate mortgages followed suit in the rate drop, falling to 2.66% with an average 0.6 point, down from last week when it averaged 2.66%. A year ago at this time, the 15-year fixed rate averaged 3.21%. 

ARMs both raised and lowered this week. 5-year ARMs averaged 2.70% this week with an average 0.6 point, raising only slightly from last week when it averaged 2.69%. A year ago, the 5-year ARM averaged 2.86%. The 1-year ARM averaged 2.53% this week with an average 0.5 points, down from last week when it averaged 2.55%. At this time last year, the 1-year ARM averaged 2.81%.

And now, as always, we have our weekly quote from Frank Nothaft, vice president and chief economist from Freddie Mac:

“Mortgage rates held relatively steady following the November employment report. Although 146,000 jobs were created, above the market consensus forecast of 85,000, revisions subtracted 49,000 workers over the September and October period. The unemployment rate fell from 7.9 to 7.7 percent. However, in its December 12 monetary policy statement, the Federal Reserve (Fed) noted that this rate remains elevated and modified the statement to tie any increases to its target rate to the unemployment rate falling below 6.5 percent. The latest Fed central-tendency forecast is for unemployment to be between 7.4 and 7.7 percent in the fourth quarter of 2013 and between 6.8 and 7.3 percent by late 2014.”

Thanks, everyone. I hope that you got all the rate information you were looking for in today’s PMMS report.  Ok, stop reading and take advantage of these crazy low rates.  Refinance or lock in to a new mortgage rate today!

The post Mortgage Rates Drop Slightly – Still Near Record Lows appeared first on .

Quicken Loans Chairman and Founder Dan Gilbert was a guest host today on CNBC’s Squawk Box.

It’s was an interesting two-hour segment, featuring discussions on the dreaded Fiscal Cliff (and how it could affect mortgage rates – can you say “go up?”), Dodd Frank legislation to regulate the mortgage industry, and the housing industry in general.

Of course, Gilbert also talked about Detroit, a place he’s pretty passionate about, in case you haven’t noticed. Lots of revitilization is underway in Detroit, and Quicken Loans is right at the heart of the growth. As a kid who grew up in the city and attended high school right smack in downtown, any news about Detroit’s growth is good news to me.

Here are three clips of Gilbert’s appearance on the show. Hope you enjoy them. Please let us know what you think. Do you agree with Dan?

Gilbert talks about the housing industry (housing prices, how the Fed affects the market, and other issues in the mortgage industry).

Dodd Frank & Your Mortgage (Gilbert explains how regulations affect the mortgage industry)

Mortgage Industy and the Fiscal Cliff (Gilbert analyzes the mortgage industry from the beginning of the video, then talks specifically about Quicken Loans)

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Do you remember when Kirstie Alley replaced Shelly Long on Cheers and the whole world lost their minds? Wait. I’m getting deja vu here….

Ok, ok, so I’m still riding the waves of last week’s takeover of the Primary Mortgage Market Survey report from my friend and teammate, Eric Mally. He knew his stuff, and I know everyone who reads this looked forward to his posts. I’m still learning the ropes, but I’m learning from the best, so I think I’ll be up to speed soon.

So without further ado, here are the mortgage rates that you’re looking for:

So, last week, mortgage rates were really close to record lows, only up by .01%. Minuscule raise. Still pretty darn low, if you ask me. This week, according to Freddie Mac’s report, rates pretty much stayed the same. They rose another .o2%, but who’s worrying about that? That’s two one hundreths of one percent, my friends. Here’s how the PMMS looks:

30-year fixed-rate mortgages averaged 3.34% with an average 0.7 point for the week ending December 6, 2012, up from last week when it averaged 3.32%. Last year at this time, the 30-year FRM averaged 3.99%.

15-year fixed-rate mortgages also took another very slight upturn, this week averaging 2.67% with an average 0.6 point, up from last week when it averaged 2.64%. A year ago at this time, the 15-year FRM averaged 3.27%. 

ARMs  dropped slightly for the second week in a row. 5-year ARMs averaged 2.69% this week with an average 0.6 point, down from last week when it averaged 2.72%. A year ago, the 5-year ARM averaged 2.93%. The 1-year ARM averaged 2.55% 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 2.80%.

Like we said in the headline – LOW, LOW, LOW.

 And now, as always, we have our weekly quote from Frank Nothaft, vice president and chief economist from Freddie Mac:

“Mortgage rates were little changed and near record lows this week amid indicators of stronger economic growth and signs of tame inflation. Third quarter real GDP growth was revised from an initial report of 2.0 percent to 2.7 percent, nearly matching the market consensus forecast.  Meanwhile, the 12-month growth rate of the core price index of consumer expenditures remained at 1.7 percent in October, which is on the low end of the Federal Reserve’s projection range for this year.

“The housing market is aiding in this recovery. For instance, fixed residential investment added positive growth over the past six consecutive quarters and in the third quarter alone contributed 0.3 percentage points to real GDP growth. In addition, residential construction spending was up 3 percent between September and October. And, pending home sales saw a 5.2 percent increase in October to its highest reading since March 2007

Thanks, everyone. I hope that you got all the rate information you were looking for in today’s PMMS report. While rates may not be as low as last week, you’ll still want to take advantage of these crazy low rates, and look into refinancing or locking in to a new mortgage rate today.

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Do you remember when Al Roker took over for Willard Scott as the Today Show’s weatherman? The whole world was in a tizzy, because everyone loved Willard Scott! He was goofy and fun. He wished happy birthdays to centenarians on air. He made people feel happy and special. Williard Scott is a national treasure! Who did this new guy think he was, coming in like he owned the place?

Well, that’s a little bit how I feel right now, coming in on my man Mally’s turf. He’s a pro at this Primary Mortgage Market Survey stuff. I have some very big shoes to fill, I know. I hope I can win you rate lovers over. I’ll do my best.

So, last week, mortgage rates had never been lower in history. This week, according to Freddie Mac’s report, they’re up, but only slightly, by .01%.  Here’s the break down.

30-year fixed-rate mortgages rose slightly from last week’s record low of 3.31% to 3.32% with an average of 0.8 points this week. Last year at this time, the 30-year fixed-rate  mortgage averaged 4.00%

15-year fixed-rate mortgages also took a very slight upturn, going from last week’s 2.63%  to this week’s 2.64% with 0.6 points. While last week had a record-setting low, marking five straight weeks of dropping rates, it’s still a far cry from last year’s 3.30%.

ARMs  have taken a nice little turn, with 5-year ARMs dropping to 2.72% with 0.6 points, down from last week’s 2.74%, and 1-year ARMs have remained comfortable at 2.56% with 0.4 points this week.

Last year at this time, 5-year ARMs and 1-year ARMs averaged 2.90% and 2.78%, respectively.

And now, as always, we have our weekly quote from Frank Nothaft, vice president and chief economist from Freddie Mac:

“Mortgage rates were virtually unchanged this week amid growing concerns around the fiscal cliff. Although low mortgage rates failed to boost new home sales in October, year-to-date sales are up 20 percent compared with 2011 volumes, and there are growing signs of a turnaround in house prices. The S&P/Case-Shiller^® national home price index (seasonally adjusted) rose 5.2 percent over the first three quarters of this year. In addition, all 20 of the city indices (seasonally adjusted) had positive growth over the first 9 months, led by a 17.9 percent increase in Phoenix. More recently, the Federal Reserve’s November 28th regional economic review, known as the Beige Book, noted that 10 of the 12 districts reported the market for single-family homes continued to improve leading into mid-November.”

Thanks, everyone. I hope that you got all the rate information you were looking for in today’s PMMS report. While rates may not be as low as last week, you’ll still want to take advantage of these crazy low rates and look into refinancing or locking in to a new mortgage rate today.

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