Mortgage Pain Hits Prudent Borrowers

192159 Resource 178438 178982 1 1197400166397 1202837388786 Controlled Mortgage Rates and Costs on Upward Trend

Today's news provides valuable direction for home buyers - Act Now.

Home loan interest rates are moving upward again after a recent two-year low. In addition, there are increases in mortgage-insurance costs, tougher requirements on down payments and other moves by lenders to restrict credit. Last month, <a title="Fees will go up in March 08 for those with credit scores below 680" href="item/190636" target="_blank">as Liz reported on November 26</a>, Fannie Mae and Freddie Mac imposed surcharges for home loan borrowers with lower credit scores. Now, higher costs will be imposed on mortgage loans even for those with excellent credit. This means: Lock now and buy before March 9, 2008 if you need a home loan to make the purchase. Even if home prices drop a bit further, the mortgage costs could mean you won’t have a net gain if you wait any longer to buy a home.The <a title="Mortgage Pain Hits Prudent Borrowers" href="http://online.wsj.com/article/SB119733436109620199.html?mod=fox_australian" target="_blank">Wall Street Journal reported this morning</a> that Fannie Mae, the giant government-sponsored mortgage investor, last week raised costs for many borrowers by quietly adding a 0.25% up-front charge on all new mortgages that it buys or guarantees. On a $400,000 mortgage, that means an extra $1,000 in fees. Freddie Mac, the other big government-sponsored mortgage investor, was expected to impose a similar fee soon, according to the article. Indeed, at 11:03 EST this a.m., Freddie <a href="http://online.wsj.com/article/SB119733436109620199.html?mod=fox_australian">made the announcement</a> – new fees for both Freddie and Fannie will go into effect for all closings starting March 9, 2008. The fees are designed to recoup losses from defaults on existing mortgages.Taking the long view (as you should when buying a home), home loan rates now are low and should not inhibit buyers. Indeed, home buyers should act now rather than expecting lower rates later in 2008. Rates are most likely to slope upward over the course of next year rather than down. And now we know that as of March 9, closing costs will rise. <a title="Quotation from Wall Street Journal 12-11-08" href="http://online.wsj.com/article/SB119733436109620199.html?mod=fox_australian" target="_blank">People with good credit scores and enough savings to pay a substantial down payment can still get 30-year fixed-rate mortgages of as much as $417,000 for 6.14% on average, according to HSH Associates, a financial-publishing firm in Pompton Plains, N.J., as reported in the WSJ article</a>.Jumbo loans, however, have become more expensive relative to smaller loans. These are loans over $417,000 and are not available form Fannie Mae or Freddie Mac. <a title="Earlier Blog Post on Regional Home Price Trends" href="item/192106" target="_blank">The expense of these loans has depressed home prices generally in the Western Region of the country because home prices have been higher here.</a> The greater expense of jumbo loans also affects the Flagstaff market, where many homes are in the higher price ranges. Expect those prices to continue at a depressed level for the next several months.Today’s message: Lock now. Buy now. 9 application/xml false 30-year fixed rate Fannie Mae fees Freddie Mac fees home loan closing costs home loans jumbo loans mortgage fees mortgage loans Mortgage Pain Hits Prudent Borrowers This mornings analysis from the Wall Street Journal http://online.wsj.com/article/SB119733436109620199.html?mod=fox_australian Freddie Mac Announces New Mortage Fee Today From Wall Street Journal on-line edition -- Fees Take Effect March 9 http://online.wsj.com/article/SB119738871924021097.html?mod=wsjcrmain Mozilla/5.0 (Windows; U; Windows NT 5.1; en-US; rv:1.8.1.12) Gecko/20080201 Firefox/2.0.0.12 127.0.0.1 127.0.0.1 $Admin 75.72.119.200 false true false false true 178975 false false true false false false true 192323 Resource 178975 178982 178982 1197514089783 1197514675382 Controlled More Information on this development

Perhaps more than you want to know!

I was cruising a blog for real estate professionals that I participate in regularly and came across a lengthy post related to these new fees by a real estate agent out of Maryland, Lenn Harley. <a title="Fannie and Freddie Redefining the Meaning of Subprime" href="http://activerain.com/blogsview/302180/FANNIE-AND-FREDDIE-REDEFINING" target="_blank">WARNING: Hard Core Real Estate Talk.</a> If you are really into the gruesome details, check it out.Your Flagstaff real estate agent,Ann Heitland 9 application/xml false Fannie Mae and Freddie Mac Redefining the Meaning of Subprime Insight and opinion for home sellers, from Lenn Harley, real estate broker in Maryland and Virginia http://activerain.com/blogsview/302180/FANNIE-AND-FREDDIE-REDEFINING Mozilla/4.0 (compatible; MSIE 7.0; Windows NT 5.1; .NET CLR 1.1.4322; .NET CLR 2.0.50727) 127.0.0.1 127.0.0.1 aheitland 24.121.32.9 false true false false true 178438 blog blogsite/BestFlagstaffHomes/web