As Mickey promised, here is the update on the mortgage rates this week:
Earlier this week, I promised an update on mortgage rates after the news of the Fed's half point short-term rate reduction had time to work its way into the financial markets. As feared, anyone expecting immediately lower long-term interest rates has to be disappointed. Long-term credit markets have worsened somewhat and are worsening further as this message is being typed. Today's early rate sheets indicated 30 yr fixed rate conforming loans in a range of 6.375% to 7.00% without discount points. As always, specific borrowers would be treated in accordance with loan size and their individual credit worthiness. At the moment, we are seeing a series of inter day repricing from our investors. It appears that the lower end of the above-stated range will move to 6.5%.
There is a growing likelihood that Fannie Mae and Freddie Mac will soon increase the current "conforming loan limit" to some yet-to-be-determined amount above the present $417,000. Best bet is for something in the neighborhood of a 10% increase (as reported in today's Wall Street Journal). This would put the new limit around $460K. This would allow some relief to "jumbo" borrowers.
There is a growing likelihood that Fannie Mae and Freddie Mac will soon increase the current "conforming loan limit" to some yet-to-be-determined amount above the present $417,000. Best bet is for something in the neighborhood of a 10% increase (as reported in today's Wall Street Journal). This would put the new limit around $460K. This would allow some relief to "jumbo" borrowers.
