Will S&P's Downgrade Increase US Home Mortgage, Auto Loan Interest Rates? International Business Times
Reported Saturday.Prior to the S&P downgrade, for all intents and purposes, institutional investors equated investing in U.S. debt, often in the form of 10-year U.S. Treasury bonds, was as good as depositing money in an FDIC-insured bank, or what institutional investors call "holding cash"
For that reason, among other factors, the interest rate charged the U.S. Government for loans was low -- very low: the U.S. Government had to pay just 2.57% to borrow money for 10 years, despite having a large budget deficit and national debt.
With the Friday night downgrade, S&P is saying investing in U.S. Government debt may not be as good as cash.
As a result, investors may ask for a higher interest rate, given the higher risk, and that could push up interest rates throughout the financial system, including, in the U.S., loans for home mortgages, car loans, student loans, small business loans and credit card rates.
Of course, it's not 100 percent certain that interest rates will move higher, but they probably will.
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Today's Mortgage Rates: Which home loan is best?
Texas Mortgage Info: How your mortgage person structures your loan is more important than the getting a low rate. www.mylendingplace.com
I currently have an adjustable rate mortgage loan and would like to set a fixed rate ?
I have heard on the news that we can petition our lender for a fixed rate. They also gave a phone number to a place called, Homeowners Unity Foundation whom I talked to, and they say they charge $2500.00 to help you because they work with lawyers that help the process move faster. But they do not guarantee results. Can anyone give me some insight or suggestions?
Stay away from this HUF outfit. Sounds like a rip off.
Read your mortgage documents. Some have a clause that you can convert for a fee (usually 1%). If so, contact the lender and ask what you need to do to accomplish this.
If you don't have this clause, you can still ask them to convert it. There may be more fees as it will actually be a refinance.
Call your lender and ask if they'll do a loan modification to get you into a fixed rate, or at least a break on the costs associated with refinancing and get all estimates in writing. From there shop around with other lenders (including credit unions) to see what rates and fees you'll be charged to refinance into a fixed rate mortgage.
When will we see the fixed loan mortgage rates come down as a result of the fed's rate cut.?
trying to figure out whens the best time to refinace or get a fixed home equity loan.
Fed's rate has no direct impact on mortgage rates. Only on short term loans like Equity lines, Car loans, Credit card rates, and Personal loans form banks
Why is the home equity loan rate going up while mortgage rate is going down?
For at least the last couple days? is there chance home equity loan rate goes down?
The two are not the same and have nothing to do with each other. The prime rate has gone up many times lately so all loan rates will follow.
When you borrow money to buy a home the bank is not the one that loans you the money. Companies bid for these mortgages and when they have a lot of money that needs to be earning something then the rate will go down. When the money is tight then the rate will go up. They will tell the bank they will buy so many millions of dollars worth of mortgages at a given rate. There are several so the rates may not be all the same. Depending on your history the bank and holding co. will decide what company will take the risk.
How long will it take the latest 3/4% interest rate cut to affect the mortgage and loan companies rates?
With the Fed's decision to cut interest rates, I understand that banks will follow suit and lower interest rates. How fast will it take for these changes to go into place? At what point should people begin to investigate refinancing their mortgages and other loans where it will actually reflect the new rates?
Unless you have a fixed-rate mortgage, the current mortgage interest rates are very important to deciding how much you should pay every month<!--therefore it is always a good idea to keep an eye on what the rates are doing. If interest rates should rise, so will your monthly payments and again, if interest rates were to fall, so would the amount you would have to pay.
http://mortgages-finance.awardspace.com/Mortgage-Rate-Compare.htm
Monthly repayments made on your mortgage and the amount that was borrowed, is determined by current mortgage interest rates. Different-->companies offer different interest rates so it is a good idea to shop around for the best deal before settling on one particular lender.
http://finance.yahoo.com/loans/article/104264/Fed-Cut-What-It-Means-for-Your-Mortgage
Lenders may be willing to refinance to a fixed rate mortgage even if you are one or two payments behind on a recently adjusted ARM
http://www.fixed-mortgagerate.com/mortgage-quote
What interest rate can I expect on a mortgage loan with my credit scores?
What interest rate can I expect on a mortgage loan with my credit scores?
Today I have 564 588 654...I am hoping to have my mid-score up 10 pts by tomorrow, and then i am applying for the loan with the bank. I want a fixed rate, 100% financing, 30 yr loan for $160,000. My income and debt ratios are good. I am closing on the Aug 6th. I have already had the house appraised at $162K, I am paying over $5K in closing costs, and the house has been inspected. This is my first home purchase, is there anything I am missing?
Im not sure you can get 100% with your mid score. Now adays the banks are way tougher than they were a couple of years ago, If they do the loan you're probably looking at an 80-20 "2 loans 1 for 80% and 1 for 20%. The 80% one probably around 9%-10% and the 20% one at around 13%.
TAKE MY ADVICE. ..you will never make any money on this deal unless you house happens to skyrocket. Your rates will be too high, and you will be going in with zero equity. Wait a while, save some money for a downpayment, and get your credit scores up over 620 or so.
my credit score is 645 and my wife. is 697.what is the best rate. that I qualify for a refinance mortgage loan?
I seem to be having a problem qualifing for a good rate loan.Do you have any advice for me?
Mortgage loan is a term used for the loans secured by a property. Mortgage loans refer to a loan secured by residential property, often for the purpose of securing real estate. Mortgage loans are priced lower than other loan structures because the value of the property risk for the lender.
http://www.worldbestloans.com/Mortgage%20Loan.htm
A fixed rate mortgage loan has its own benefit. If the borrower is budget conscious, he will remain at peace because the monthly mortgage amount will not change.Fixed rate mortgage loan is a loan where the interest rate remains the same through the term of the loan. Fixed rate mortgage loans are the most traditional form of loan.
It's not just your credit score that is important. It is also the debt ratio (how much you owe vs. your balance) and other criteria.
Read up on how the credit score is determined here: http://www.gmigllc.com/credit/3314.php
But Mortgage companies look at the whole picture and disect your credit report, no matter what the score is. Make sure you have a clean file.
Do people have bargaining options when getting an interest rate on a mortgage loan?
My wife and I are buying a home for around $210k in a rural town in VA. We went to a lender and were told that our interest rate would be about 6.5-6.8% and that it would be the same just about anywhere we went. We both have good credit (mid to upper 700's) and have a downpayment of $60k. The rate she quoted was for an interest only loan lasting 5 years. Given our good credit and downpayment, should we try to bargain for a better rate? Is this rate going to be the same every place we go? I just felt like she was trying to give us as little info as she could and making it seem like the rate she quoted us is our only option.
yes
-me
With your great credit you should qualify for a fixed rate mortgage with a good interest rate...
Although you can pay points to lower your rate, you should find out how much saving would these upfront costs translate into. For example, if you have to pay 1 point ($1500, $210K less 60K down payment = 150K loan amount) and your interest rate will lower by 0.5%, that means the monthly payment will lower by $62.50. You can recapture your 1 point fee in 24 months. If you want to keep your home for more than 2 years, it maybe acceptable to do so. If not, then, keep $1500 to yourself.
Good luck shopping!
She didn't offer you a 30 year fix loan principal and interest rate because she knew the rates their bank had were high and knew you wouldn't go for it. Then she would lose your business.
My point is stick with a 30 year fix loan, principal and interest.
I get the best interest rates out there. I can get you a 6.375% on a 30 year fix loan principal and interest. No points. I wouldn't really try and buy down the interest rate, your payment would make like a $10 difference. Not worth it when you are paying $1000 to buy down for a lower interest rate. I reccommend a 30 year fix just because it sets a finish line for the borrower and you don't have to ever worry about the rate adjusting on you in the future if the market takes a tumble.
If you are intersted please feel free to email me.
bsolis@watermarklending.com (We are on the Lending Tree Network)
However, rate is not everything. Service should be taken into consideration as well. If you were referred to this broker and know that she is credible, I would stick with her. The rate she quoted is competitive. Rates have been on the rise, so as long as you are not paying any points or origination fees, you've been quoted a good rate.
I caution, as others have, on the interest only though. Right now I would stick wtih a fully amortized fixed rate. That's what I'm recommeding to my clients right now.
Any reputable broker should give you a Good Faith Estimate and a copy of your credit report so that you can comparison shop. Ask for a copy of the Truth In Lending as well and use the APR at the upper left corner to guide you. Don't focus merely on rate, the costs are important - as well as trustworthiness. Look for someone who is a member of the National Association of Mortgage Brokers and their local state association.
Full disclosure - I'm all of the above.
Let me ask you this: Is this a Stated Income or No Documents loan? Stated/No Doc loans have higher interest rates, and given your credit score and high down payment, it sounds like this is an unconventional loan. Did you provide W-2s to prove income? Do you have a regular job or are you self-employed? Are you able to document all of your income?
That's the only thing that makes sense, because otherwise this interest rate is too high for an interest-only loan.
Agerage rate a 25 year old would have to pay to get a mortgage loan?
I am 25 years old looking to buy a house in CA. I make about 32k a year and hoping that if I am ever going to buy a house, now is the time.
What is the average rate a mortgage broker will give a 25 year old with good credit, but with no equity or asset in my name.
How does the federal funds rate effect mortgage loan?
It wont affect it, sometimes it can make it worse. Mortgages are sold like Oil, or Corn ect. They are sold on the open market. If China, Japan ect decide they dont want to buy mortgages anymore the rates go up.
The Fed doesnt control mortgage rates. The people that buy mortgage backed securities do.
People that think the Fed controls mortgage rates are wrong. Its like thinking the feds lowered mortgage rates and now the price of corn should go down. Its the same thing.
Its purely a market decision not a fed decision.
Whats the difference between the interest rate and the APR in a mortgage loan. How is ARP calculcated?
Take for example a 30-yr conforming loan at 5.5 interest rate and an APR of 5.98. What does that mean and what are the factors involved in determining APR.
The APR calculation is compicated and there is a formula for it that I would challenge anyone in the mortgage business to really use correctly. However, a basic understanding of the things that impact the APR is helpful in insuring that you are comparing apples to apples in choosing a loan.
The APR factors in the pre-paid finance charges of a loan along with the note rate to arrive at the yearly cost of borrowing. Yes, it assumes that you will keep the loan for whatever the original term is so if you payoff a loan in 5 years vs. the term assumed in the APR calculation, the APR over the 5 years will be higher than what you thought originally. Basically, the less time you plan to be in a loan, the lower you will want the costs to be. Otherwise, you are paying for interest rate savings that you will never see.
First, lets assume that there is no private mortgage insurance involved. If the note rate was 5.5 and the APR was 5.98 on a 100K loan, your pre-paid finance charges would be about 5K. Essentially, it is costing you 5% to buy the rate down.
If PMI is involved, it also affects the APR calculation because it is assumed that you will have the PMI for about 10 years and, indeed, it increases the cost of borrowing. Lets say you are doing a 90% purchase, the PMI is probably a factor of 0.375 or so. Using the same example from above, we would subtract the PMI factor from the APR. Now, our pre-paid finance charges are much less of a factor as they are about $1200 so a majority of the difference between the note rate and the APR is explained by the presence of PMI.
From our first example, lets compare the 5.5% to a 6% loan with no (or minimal) pre-paid finance charges to see which is a better deal. At 5.5%, our payments would be roughly $568. At 6%, they would be roughly $600. So, why would you spend 5K upfront to save $32 a month? It would take 13 years before you actually started to save money. Less if you discount the $32 monthly savings. In fact, if you discount the savings at an average rate of 3%, it would take about 16.5 years to break even on the basis of net present value.
I hope that something that I have said will help to clarify the difference between the note rate and APR.
If you have any follow up questions, you can email me through the link in my profile.