Mortgage Rates

Here we go again. This past week we some mortgage companies drop there rates as others went up. This is one a sign of the government driving rates down as the plan was designed to. The other is, Lenders, Banks and other sources of money are overwhelmed with business so they have to raise rates to slow down the mortgages from coming in. I try to watch as many banks, lenders and mortgage companies as possible on a daily basis, even with all the tools I have, it has been very difficult.

This week I happen to take 2 mortgages that are 2 families, they are both occupied by there owners and make a nice rental income. The loans are somewhat perfect, good credit, good equity, life is just grand! Until I have to lock them in via the Fannie Mae pricing tools. Because it is a 2 family (all properties from 2 to 4 family) the client received a 1.00% pricing adjustment and not in there favor. It brought the rate of 5.125% to 5.50% just like that for owning a 2 family. Just one more way that Fannie Mae has be accustomed to charging us for everything. They already charge if you take cash out of your home over 70% of the appraised value, if your credit score is below 720 and numerous other adjustments. Frustrating to say the least. It becomes harder and harder to even quote a mortgage rate without knowing all the details of the borrower, the home and anything else they can think of penalizing.

Don't even bother trying an investment property these days unless you have a minimum of 20% down and want to pay points. The Private Mortgage Insurance companies will no longer insure these properties and the lenders don't want them either.

The most important advice I can give these days is to get pre-approved long before you begin to look for a home. Get all your credit documents into he lender/broker and let them review it. All too often we have that client stroll through the door and say " I just bought a house and now I need a mortgage!" This never works out!


Just a another day in the life of a changing market place. The good news, mortgage rates are staying fairly low, we did see them at 4.875% for a few minutes. Careful when you hear or read the average mortgage rate, typically it will have an average amount of points or other costs. I have heard it so much, the rate is now 5.1% and in fine print the average points came to .8% in fees.

If you are shopping for rates, The RATE MUST BE THE SAME AS THE APR!!!!!

Rate: 5.125% The APR should be 5.13, it is always carried out to 2 decimals and if the cost of the mortgage is low or reasonable the APR will be the same. The division of banks requires when in print, the APR be the same size font as the RATE.

Buyer beware!


I hope all is well and always feel free to give me a call or email with questions!!!!!



Bill Nickerson
Vice President
Mortgage Network/Emerson Lending
179 Great Road
Acton MA 01720
bill@billnickerson.com
www.emersonlending.net