http://www.gazette.com/articles/sales-98189-home-april.html

Colorado Springs Real Estate is looking goooood!

Fannie Offers Spur to Avoid Foreclosure ~ Fannie Mae will make it easier for some struggling homeowners to buy houses in the future if they avoid foreclosure in the present.  Under rules released this month that will take effect in July, some troubled borrowers who give up their homes by voluntarily transferring ownership through a “deed in lieu of foreclosure” or by completing a short sale, where a home is sold for less than the amount owed, will be eligible in two years to apply for a new mortgage backed by Fannie.Fannie Mae has announced a new plan that would help those that have lost their homes, re-group and buy again in two years.

This is good news for those folks that have lost their homes and want to avoid paying rent for Years until they could own a home again…. GO FANNIE MAE!

Here is a summary of the changes:

First-time buyers who have not had interest in a principal residence for three years are still eligible, and the maximum amount remains the same; $8000 for married couples, $4000 for those filing separately.

Current homeowners who have consecutively maintained the home they want to sell as their primary residence for five of the last eight years are also eligible. However, the maximum amount for those homeowners is lower; $6500 for married couples and $3200 for those filing separately.

The tax credit may not be used to purchase a home for more than $800,000. All buyers who want to get the credit must include documentation of the purchase on their tax returns.

The income limits for both tax credits have been raised to $125,000 for single buyers and $225,000 for married couples.

Thats it in general terms – and in a nutshell. If you have specific questions, please contact me.

Cheers
Brian

Tomorrow morning brings us the first revision to the 3rd Quarter Gross Domestic Product (GDP). The GDP revision is expected to show a downward revision from last month’s preliminary reading of a 3.5% annual rate of expansion. Current forecasts call for a reading of approximately 2.9%, meaning that there was less economic growth during the third quarter than previously thought. This would be good news for the bond market and mortgage rates, but it will likely take a smaller than expected reading for this report to improve mortgage rates.

November’s Consumer Confidence Index (CCI) will also be released tomorrow morning, but during late morning trading. It gives us a measurement of consumer willingness to spend. If consumer confidence is rising, analysts believe that consumers are more apt to make larger purchases, essentially fueling economic growth. This raises inflation concerns and usually pushes mortgage rates higher. Analysts are expecting to see little change from last month’s 47.7 reading, meaning consumer were just as concerned about their own financial situations as they were last mo nth. A weaker than expected reading should be good news for mortgage rates, but a stronger than expected reading could push mortgage rates higher tomorrow.

Also worth noting about tomorrow is the release of the minutes from the last FOMC meeting and the 5-year Treasury Note auction. Both are afternoon events and both have the potential to heavily influence the bond market or be a non-factor. The results of auction will be posted at 1:00 PM ET. If there was a strong demand from investors, we could see bond prices rise and mortgage rates fall during afternoon hours. But a lackluster interest in the sale could lead to higher mortgage pricing.

The FOMC minutes may be a major mover of the markets or a non-factor, depending on what they say. The key will be concerns over inflation and the Fed’s next move. If the Fed members were concerned about inflationary pressures and overly optimistic about economic growth, we may see the bond market move lower and mortgage rates higher tomorrow afternoon. However, if they indicate a likelihood of another rate cut in the coming months, we should see the bond market rise and mortgage rates drop during afternoon trading.

Overall, I believe that it is going to be an active week for the mortgage market, particularly the first half. Friday will be the least important day of the week and either tomorrow or Wednesday will be the most important. I expect to see plenty of movement in rates the first couple of days, possibly afternoon revisions also, so please be careful and maintain contact with your mortgage professional if you have not locked an interest rate yet.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Float if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

Brian Olsen

The stock markets appear prepared to close the week in negative ground. This should be good news for bonds heading into next week. Since there is no relevant data scheduled for release today, any changes to mortgage rates this afternoon will likely come from sizable move in stocks. If the major stock indexes continue to move lower, there is a possibility of seeing downward revisions to mortgage rates this afternoon.

There are a couple of important reports scheduled for release next week. There is relevant data being posted Monday when the National Association of Realtors gives us October’s home resale figures. It is expected to show an increase in sales from September’s level, meaning the housing sector improved over the past month. However, this data is not considered to be highly important, so it will likely take a sizable variance from forecasts to cause a noticeable move in mortgage rates.

Next week is a holiday-shortened week due to Thanksgiving Day, meaning all of the week’s data will likely be released the first three days of the week. Look for more details on next week’s events in Sunday’s weekly preview.

If I were considering financing/refinancing a home, I would…. Lock if my closing was taking place within 7 days… Lock if my closing was taking place between 8 and 20 days… Float if my closing was taking place between 21 and 60 days… Float if my closing was taking place over 60 days from now… This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers… so take it with a grain of salt.

Brian Olsen

www.explorecoloradohomes.com

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