In the final fiscal quarter we have all expected interest rates to increase slightly, but that is not happening. Contrary, housing prices are decreasing slightly, the Feds announcement that they will delay scaling back its bond purchasing
In the final fiscal quarter we have all expected interest rates to increase slightly, but that is not happening. Contrary, housing prices are decreasing slightly, the Feds announcement that they will delay scaling back its bond purchasing, which has been keeping our mortgage rates low, and an increase in housing inventory are giving Californians a great landscape for new homebuyers.
n a day-to-day basis 30 year fixed rates are fluctuating between 4.25% and 4.5%, while FHA rates remain well under 4% for a 30 year fixed rate mortgage. FHA will also be voting next month on reducing the monthly mortgage insurance rates by 70% and removing the life-time MI clause, allowing many more first-time homebuyers to qualify with lower monthly payments. Of course, this monthly mortgage insurance reduction puts cash back in the borrower's pocket and increases their purchasing power as well. Silent 2nd loans that are married with the FHA first mortgage are becoming more popular. CHDAP, which is CA based non-profit allows borrowers to take a simple-interest loan for 3% of the mandatory 3.5% down payment (required by FHA) enabling first time home buyers to purchase their first home with only $1k to $1500 down payment. The Silent 2nd means borrowers make no payments on this home loan until they refinance or sell the property, and with the low rate of 3.25% it's a win-win for homebuyers. Please always inquire about Grants and Non-profit 2nd home loans that are married with FHA loans when speaking to your loan officer.
While mortgage rates are still very low Fannie Mae and Freddie Mac will be increasing the minimum down payment required on Conventional loans from 3% to 5% on November 16th. Currently, conventional monthly mortgage insurance is less expensive than FHA MI. Together with increasing home values many FHA mortgage borrowers have been refinancing their FHA mortgages into conventional loans, saving a few hundred dollars per month. Always feel free to give us a call and speak to one of our seasoned loan officers on how you can save money on your opportunities.