March 13th, 2009
Weekly Mortgage Round Up March 13
Mortgage rates dropped from 5.15% to 5.03% for the benchmark 30 year fixed rates. This includes a .7 point charge. The 15 year, 5/1 ARM and 1 year ARM all slightly dropped from last week. You can see the full numbers at Freddie Mac.
According to the Mortgage Bankers Association, there was a 11.3% increase in mortgage applications last week. However this number does not take into account if a borrower applies for a loan across multiple lenders. If a borrower applies 5 times with 5 different lenders, it will be counted 5 times. I have a feeling that borrowers are now applying with several different lenders in hope that at least one of their loans will be approved.
As I’ve mentioned before, there is an underlying assumption that the government is going to drop rates to be able to offer a 4.5% 30 year fixed loan. There is a lot of chatter about this on mortgage related blogs and forums, but there doesn’t seem to be a lot of downward activity in the mortgage rates to support that this 4.5% 30 year fixed is going to become available.
Right now, the best option is to contact your lender and see if they will modify your mortgage. If you can save money today by refinancing into a rate in the 5’s, holding out for a pipe dream of a 4.5% fixed mortgage seems foolish. Watch out though, there are plenty of unscrupulous loan modification companies out there, its best to do your own work and avoid the con artists.
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