Allen Park MI Real Estate | Mortgage, Housing Market, Buy House, Home Buyers, Foreclosures, and More » Mortgage

Federal Reserve Lowering Mortgage Rates?

Tom Crowe — Tue, 24 Mar 2009 17:37:31 +0000

From what I am hearing the Federal Reserve is buying long term bonds with the anticipated result to lower mortgage rates. Currently hovering just under 5%, some think mortgage rates could go to 4%. However, waiting for this to happen could be dangerous because when the Fed decides it’s time to balance their balance sheet the opportunity will be gone for some time to come. Like I have said in other posts: “What the government “giveth”, the government “taketh” away.

There are many changes taking place in the mortgage market to restrict perceived dangers. One of which is eliminating PMI (private mortgage insurance) on condominiums. This rule does not apply to FHA loans, but the condominium association must be on the FHA approved condo list. At this point I don’t know how these changes are going to affect our Southeast Michigan housing market (I don’t think it will help), but the cure to all of our financial ills is jobs and jobs that will allow funding of a mortgage.

Details on Mortgage Loans

Tom Crowe — Thu, 19 Feb 2009 16:57:37 +0000

Details are just starting to come out about the latest economic stimulus plan. I for one, certainly hope that it works and gets our economy back on track. What bothers me most is who it is going to fall on to pay for. To date the total package is adding up to about 1.5 trillion dollars.

I am hearing about another 50 billion for housing (I thought the first 700 billion was suppose to do something for housing) and the new Secretary of the Treasury has talked about another 2 trillion dollars. If these two items come to fruition then the total package will be in the neighborhood of 3.5 trillion dollars. I’m not sure, but I think a trillion dollars is 100,000 billion. What is the thought of how and who is going to pay for it. Especially if the stimulus plan does not work as it is intended.

Another thing that bothers me is why is there no plan for the banks and the insurance companies to pay back the money that was given to them? No restrictions were put on the banks and insurance companies as to how they were receive the money or how they were to use it, especially in Allen Park. Where were the questions by congress on how this money was to be used or a requirement that they provide a business plan on how there use of the money would make them once again solvent?

I remember the savings and mortgage loan scandal of the eighties. At that time it was mostly commercial mortgage loans that were in question and appraisers had to become licensed as a consequence. Mortgage loans were made on buildings then, even if fully occupied they would not cover the debt service on the mortgage loan. I could be wrong, but I do not believe anyone went to jail, but I do know that the American Tax Payer paid the bill and we are doing it again. And our children and their children’s children are going to pay for it.

I can only urge whoever reads this and agrees with the questions that I have asked do as I am going to do and write my Allen Park congress person and ask for honest and legitimate answers. I welcome your thoughts.

Allen Park Home Loans

Tom Crowe — Mon, 19 Jan 2009 20:54:50 +0000

Housing is an important part of our Allen Park economy because of the myriad amounts of associated products and services it requires. Examples are appliances, flooring, fixtures like lighting and plumbing, roofing and windows to name a few. Therefore, as reasoning goes, it is in the best interest of the Allen Park and national economy to make homeownership available to as many people as possible. When I bought my first house in 1971, I used the Veteran’s Administration mortgage. This was an opportunity for me to get into a house with the least amount down with this type of mortgage. The mortgage lender allowed me to ask the seller to pay my closing costs and also any “points” that were required at that time. To the dismay of the seller and unknown to me at the time, “points” changed at the last minute and caused an increase to the amount of money the seller had to set aside to cover the cost of originating my mortgage.

Today, in Allen Park it is more common to lock rates at application time or depending on your mortgage loan officer, monitor the rates daily in order to capture the best rate available. Also today, or before the current foreclosure crisis, many more Allen Park mortgage options and products are available. Allen Park mortgage lending has become a very complex adventure even for the most experienced purchaser. If you have questions please feel free to ask. If I don’t know the answer I’ll send you to a person who can.