Mortgage Rate Update 9/4/09

Investor sentiment about the economic recovery fell this week, and the stock market declined. Expectations for slower economic growth are favorable for bond markets, including mortgage-backed securities (MBS), and mortgage rates ended the week a little lower.

The important monthly Employment report showed mixed results. Against a consensus forecast for a loss of 225,000 jobs in August, the economy lost 216,000 jobs. This was the smallest level of monthly job losses since August 2008 and was far below the monthly average of 691,000 seen during the first quarter of the year. The biggest surprise in the data came from the Unemployment Rate, which jumped from 9.4% to 9.7%, the highest level since 1983. The unexpected increase was mostly due to previously discouraged workers returning to the labor pool to look for jobs. Average Hourly Earnings, a proxy for wage growth, rose at a moderate 2.6% annual rate.

The future of Fannie Mae and Freddie Mac made the headlines this week when the Mortgage Bankers Association (MBA) released its restructuring proposal. While the MBA suggested the elimination of the two agencies, it would replace them with new entities which would perform many of the same functions, with many of the same people. Its plan would maintain a government guarantee of principal and interest for MBS investors. The two agencies have played a pivotal role in keeping mortgage rates low and in expanding homeownership, and the MBA proposal would retain these benefits. It’s very early in the process, and the Obama administration indicated that its proposals for Fannie and Freddie may not be revealed until early next year.

For expert assistance with your financing needs, call our in-house mortgage executive, Rick Cannavaro, at (203) 672-2706.

Click here to send a secure online mortgage application.

Here are this week’s rates:

Friday, September 4th, 2009

All rate quotes are for a 60-day lock with 0 points, 5% down payment, and a 720 FICO score.

Conforming limits are up to a $417,000 loan limit*

30 yr conforming fixed: rate = 5.000% APR = 5.226%

15 yr conforming fixed: rate = 4.625% APR = 4.882%

7/1 yr conforming ARM: rate = 5.125% APR = 5.425%

5/1 yr conforming ARM: rate = 4.500% APR = 5.014%

30 yr FHA Fixed : rate = 5.125% APR = 5.355%

30 yr CHFA w/ 1 pt : rate = 4.875% APR = 5.236%

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Jumbo loan limits range from $417,001 to $1,000,000*

30 yr jumbo fixed: rate = 5.750% APR = 6.022%

15 yr jumbo fixed: rate = 5.500% APR = 5.725%

7/1 yr jumbo ARM: rate = 5.125% APR =5.405%

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CHFA (Connecticut Housing Finance Authority) rates for the week of  September 3 – 9, 2009

Homebuyer Mortgage Plan:
Interest rate: 4.875 % (APR range 4.975 – 5.375%)
Fees: Up to One Point (1% Origination Fee) * Payable to Lender
Term – 30 years, fixed rate

Downpayment Assistance Program (DAP)
(Rate listed is for DAP loans with Homebuyer Mortgage Program financing.)

Interest rate: 4.875 % (APR range 4.975 – 5.375%)
Fees: Up to $200 Application Fee * Payable to Lender
Term – 30 years, fixed rate

(NOTE: If at any time the interest rate for the Homebuyer Mortgage Program exceeds 6%, the DAP interest rate will be capped at 6%.)

* Additional fees may apply

*Conforming loan limits listed above are for a single-family owner occupied residence.
Courtesy of The Harriman Team and William Raveis Mortgage

*All rates are subject to change. Minimum down payment and credit score requirements may apply. All information provided is deemed reliable but is not guaranteed and should be independently verified .

William Raveis Real Estate, 465 S. Main St., Cheshire, CT 06410

Tagged as: 06410, Adjustable rate mortgage, CHFA, DAP, Federal Housing Administration, interest rate, Jumbo mortgage, mortgage rates