I am pleased to once again welcome Mortgage Banker Brian Cav, the creator of a mortgage blog called Smarterborrowing.com. Here’s his weekly mortgage market update, which I’m sure you’ll find interesting.
Mortgage Markets have gone up a bit the past 24 to 48 hours. The European bailout will have a ton to do with what happens with markets in coming weeks. Mortgage rates are going up and down based on the guidance they get from headline news and the stocks. With mortgage rates down near the low of the year, I love LOCKing all loans closing in the next 30 to 45 days. Borrowers closing in more than 30 to 45 days should consider paying the extra costs to secure a longer term lock. Most Lenders will charge a 0.25% fee (based on your loan amount) to lock in your loan for more than 45 days. On a $300,000 loan, that is an extra cost of $750 which is a small price to pay over the life of your loan if rates do increase in the next 45 days. In I think they certainly will.
The par 30 year conventional rate mortgage remains in the 4.75% to 5.00% range for well qualified borrowers. To secure a interest rate on a conventional mortgage you must have a FICO credit score of 740 or higher, a loan to value at 80% or less and pay all closing costs including an estimated 1 point discount fee. For consumers with lower FICO scores (700 and less) and higher loan to values, you should consider an FHA loan.
FLOAT or LOCK
If I was closing on a Home Mortgage in the next 0 to 15 Days – LOCK
If I was closing on a Home Mortgage in the next 15 to 30 Days – LOCK
If I was closing on a Home Mortgage in the next 30 to 60 Days – LOCK
If I was closing on a Home Mortgage in the next 60+ LOCK
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.