Seattle Mortgage Loan and Real Estate Blog

We had a very bad week in the mortgage interest rate world. 3 days of higher rates with a trend down on Friday so we shall see what the week ahead brings us.

Real Estate season in the Seattle area is still in full swing as I have seen many homes get multiple offers and/or sell within a few weeks at near full price.  The market here is still good IMO and if we can keep rates down I anticipate rising prices in premium areas in the second half of 2008.

Greetings all, have not blogged for sometime as the feedback to the blog has been minimal but I will continue on as I feel it is a great way to get some current information out to my site viewers.

My impression of the past few weeks is the market has finally "stabilized" in regards to massive rate swings. Rates have stayed steady now for nearly a month and we are finally seeing better rates on the new Fannie/Freddie Agency Jumbo loans. These are the "new" temporary loan limit increases approved earlier this year. The rates on these loans were out of the market and they were not that popular but now these same loans up to $700k+ in some areas are nearly as good as the rates on a $100k loan.

FHA is now the new "subprime" loan of choice. Two reasons: 1) they PERMANENTLY increased their loan limits to 500k+ in the Seattle area and 2) they allow nearly 100% financing for people with credit scores below 620 which does not exist anywhere else.

The home purchase market is in full swing in Puget Sound as this is the traditional peak of home purchasing. Buyers still have MANY homes to choose from and they are picky so if you are listing your home for sale make sure it shows VERY well and it is priced correctly. Ill be back in a week or so...cheers!

We just finished up a brutal week on the mortgage rate front, 4 bad days with a good day on Friday. Hopefully the Friday trend continues into next week. It was a week devoid of much mortgage specific news but inflation readings are starting to come in high and nothing, absolutely nothing will bring up rates faster than rising inflation numbers.

Loan programs continue to be eliminated, programs that still exist are having more and more restrictions placed on them but I still feel this is a great time to buy or refinance if you qualify. Another piece of great news is FHA stepping up with higher loan limits and no requirements for nearly perfect credit or large down payments. FHA is or will become the home for all "normal" people loans in the near future.

We will be seeing a huge volume of mortgage rate resets on ARM loans over the next 6 months. After that period of continued foreclosures and borrowers having tough times refinancing I think the market will finally start to settle down a bit and lenders might get back to common sense underwriting vs. the extremes of today on the "tight" side and the crazy, anything goes times of the past few years. Cheers!

Wow, another crazy few weeks in the real estate and mortgage world!  I will start with a highly unusual situation that is occurring regarding mortgage rates, we have 30 and 15 year fixed mortgage rates that are nearly 1% BETTER than 3,5 or 7 year ARM rates.  Just two weeks ago we finally had ARM rates that were almost 1% less than fixed rates and now investors have decided that ARM loans are not what they want so the rates jumped and fixed rates are back down in the 5's.

Starting to hear about more people getting back into the purchase market as mortgage rates are very good, inventory is high and sellers are doing whatever it takes to sell a house right now. Hopefully the spring buying season is a good one as we need it.

2008 is expected to be a very tough year nonetheless and we are still seeing many companies not survive, loan programs going away daily and just general turmoil.  The best advice I have if you are looking to buy or refinance is to keep your credit scores HIGH ie above 680, save at least 5% to purchase a home and dont plan on getting a second mortgage or stated income loan unless you have a nearly perfect profile.  Call or email to discuss your specific situation, as I like to say I have NEVER done two mortgage loans that were exactly the same and probably never will.

A quick note to let everyone know that mortgage rates have jumped considerably this week.  More companies continue to go out of business, many loan programs are disappearing weekly and it is very hard to keep track of all the changes.

The best advice I can give you is keep your credit score HIGH!! Those with less than 680 FICO are getting hit hard right now and/or just not being able to even qualify.

GOOD NEWS! Conforming and FHA loan limit increases were announced today. In KING, PIERCE and SNOHOMISH counties the new limit is $567,500 up from $417,000.  Some areas of the country did not change while others went all the way to $730,000. FHA limits are expected to be in the 700k range but as of right now I do not have the exact new mortgage loan limits for FHA in the Seattle areas.

Put your seatbelt on if you are in the market for a mortgage right now, it will be a bumpy ride:)

This has been the common theme this month in the mortgage world. We had a 24 hour window of record low rates in late January followed by wild upswings that brought rates up over 1% in less than 3 weeks!! This week has been VERY good for rates and now they are on a pretty good downswing.

I said it before and will say it again, get your applications in and ready to lock. The window of opportunity can be very short and if you get too greedy it could cost you thousands of dollars over time.

The Seattle market ended 2007 with a .5% value increase which seems bad but it was the 3rd best in the nation! The 4th quarter did see Seattle area prices start to drop but very slowly. Nationwide the real estate market is in for a very tough year. Hang in there and please call or email anytime if I can be of help.

I wanted to take a moment and relate my personal philosophy on the types of loans and lenders that created our current mortgage mess.  In regards to loan types the subprime and option ARM loans were the two biggest loan problems. Did mortgage brokers/bankers create these loans or did they just sell what Wall Street and the big banks said they wanted to buy? They just sold what they were told people wanted to buy. Did mortgage lenders do this in the best interst of their clients or themselves? That is a little tougher question as people were coming to us begging for these loans and if we didnt do them someone else would.

I personally never liked or recommended the Option ARM loan. In over 10 years of mortgage lending I think I have done a handful of these loans and that was only because my client demanded them even after I offered other safer loan choices.  Subprime was a little different, I still didnt like these loans but did them as a last resort for clients with credit or asset issues that would not get them into a home any other way.  MOST of my clients were able to get a little equity, improve their credit and get out of these loans and into good conventional mortgages within the two or three year fixed rate portion of the loan.  Those who continued to abuse their credit usually just sold the home and at least broke even or slightly ahead.

The only ARM loan I really recommend is the 5 year in either a fully amortized or interest only option.  I dont think interest only is a bad loan but you have to know how to manage it.

The mortgage rate markets ended up pretty flat to end January. We had a ton of big news, fed cuts etc...but it seemed that any bad news was offset by a good report or two and in the end rates on 30 year fixed conventional loans ended up around 5.5% for the week. Dont hesitate to get your loan applications in as I have over 15 clients right now who are completely approved and just waiting to lock in a rate. Till next time...cheers!

We just finished up one of the most chaotic weeks on the mortgage interest rate front that I can remember. The Fed cut interest rates on Tuesday by .75% which caused long term mortgage rates to plummet on Tue and early Wed.  About 1pm on Wed, the stock market made a 600+ point swing and the 10 year Bonds went south which drove interest rates UP over 1/2% in less than an hour. Thursday was negative as well on the mortgage rate side but Friday bounced back to erase the rate increase from Thursday.

What I saw Tue and Wed was that those who were greedy or just not able to make a quick decision missed out on a window of locking the best mortgage rates I have seen in over 10 years. Those who made quick YES decisions and locked are very happy right now.  Rates still ended up in the mid 5's for the week but were in the low 5's on Tuesday.  Motto of the story: get your application in if you have ANY type of ARM or a fixed rate over 6%. When the window opens up again lock in a mortgage rate that makes sense and dont worry about whether it will go down another 1/8% or so...when you are at or near all time record low rates the lower rate opportunity risk is far exceeded by the higher rate risk.

Rates always go up faster than they go down and they really cant go much lower than where they sit today but they can go much higher IMO. Have a great week and I will post again mid week or sooner with a quick market update.

Quick entry today as my phone is ringing off the hook. Record low rates are back on conventional 30 and 15 year fixed.  We literally have mortgage rates as good as the summer of 2003 which was the lowest level in 40+ years.

I have alot of things to discuss but not much time so I will bullet point a few things I think about the market as of today.

-We are currently in a recession right now

-Mortgage rates will stay in the 5's for the forseeable future, will they get below 5 is the question.

-My fence sitters are now OFF the fence ie investors, 2nd home buyers etc...I think the housing market will see a rebound in 08, especially in the Seattle/Portland metro areas which really have not been affected much anyway

-Dont hesitate to get that mortgage now, these rates can and have disappeared within a matter of a day or two before and could again

Post a comment, email or call if I can be of any assistance...cheers!

Oh wouldn't life in the mortgage and real estate business be so dull without VOLATILITY...:) We started the week with stock market mayhem which tends to lower rates.  Today, Jan 10, we have seen the trend reverse somewhat as the BIG news of the day that BofA is in talks to acquire Countrywide shook up the markets.

Why should you care about Countrywide?  They are the #1 US home lender and two days ago they appeared to be heading towards filing BK although they strongly denied the rumors.  Trust me, we don't want the largest lender in the US filing for BK so maybe this takeover makes sense in this environment.  BofA also invested around 2 billion dollars in Countrywide last year and has a financial interest in seeing them succeed as well. 

I would love to keep this blog updated daily and I need one thing to happen, I need YOU to participate.  The revised site has only been up and running for a little over 2 months and just today we saw a HUGE jump in traffic so I KNOW you are looking:)  Don't be afraid to offer suggestions for blog topics, site suggestions or just say hello as I am always available to discuss mortgage and real estate issues via phone, blog or email.  I don't just lend in Seattle, we lend in WA, OR and ID at this time and our looking to expand our available states shortly.

Todays 30 year fixed rates are still in the mid 5's which is fantastic. I think the buying season will be good in the Seattle metro area as there is a ton of inventory to look at.  I am going to sell my little house in the Wedgwood neighborhood of Seattle so I will let you know how that goes.