Rates
What a strange month, rates have been bouncing all over the place, one week we have good economic news and the next week chaos in Israel causing flight to US Bonds.
I won’t go into the US economic report, most if not all were pretty good. But…
-Disappointing Industrial production out of France, Italy & Netherlands.
-China exports are falling.
-Japan economy stalling.
-Israel, always something new there.
-Ukraine getting invaded or is invading.
-Portugal, this is new, 2nd largest bank is insolvent??
But as you can see below, we have been trading is a pretty broad band, somewhere between the 4.00% mark and the 4.375% mark. So if you are really good, a person might be able to save and 1/8 of a point here or there, but pretty stable since April 30th.
And if it wasn’t for all of the good employment numbers last week, we could of actually saw rates back in the 3’s again.
This week also saw the Fed indicate that they will be out of the bond market buying frenzy, i.e. QE3 by October. Although this isn’t new news, it was reinforced.
Funny how it was said that rates were going to be going into the 5’s because of the winding down of QE3, but really over the last year, we have only seen 1% increase in rates.
I think if a person is happy with a rate between 4 & 4.375, go ahead and lock them up, you might catch it at that 4.25%. Government rates keeping at a solid 3.75%, not seeing too much movement there.
Fannie Mae changing rules
Looks like Fannie Mae will be changing rules regarding short sales and foreclosures on August 16th.
Previously you could purchase a home 2 year out of a short sale/foreclosure with 20% down, this has been removed, now you have to wait a minimum of 4 years.
Although there is an exception for Extenuating Circumstances, but most lender will have the borrower try to walk on water before they approve that.
I will attach new updated sheet to the email or you can download it on the right side of the web page.
Link to new sheet on "When can I buy" flyer.
Lending Guidelines
Lately we have been seeing quite a bit of “Personal” property included in purchase contracts.
Some of these have been refrigerators, swing sets, hot tubs, water softeners.
UW will require the PSA to state that these items “have no value in this contract”. Mainly because this can be considered and enticement or inducement to purchase a home. And enticements/inducements are illegal or have to be considered value and part of the limit on how much a seller can offer a buyer in closing costs.
Now many of you are saying, refrigerator, whatever. But have you looked at some of the refrigerators lately, nice once can go for almost $3000. “Come buy my house and I will through the refrigerator in!”
And swing sets, I have seen some way, way over $5000.00
So FYI, add the line and save from having to do an addendum down the road.