Mortgage rates WTF

[Galaril]

I am really fucking pissed after just checking the interest rates for 30 year fixed mortagages were at 6.125% up form last weeks 5.895? WTF! I understand why the mortagage rates went up but I didn't see this coming and was getting ready this spring to buy our first family home in late spring May-June time frame. But, now I am doubtful and despairing that my wife and kids will be stuck for another year in the small two bedroom place we have been in waiting for the housing amrket to bottom out some before prurchasing. I am really bummed about this I mean I have excellent credit, some down payment money a plus 800 credit score and no debt yet I am looking at a plus 6% interest rate because people years ago who took mortagages they couldn't afford are now going belly up that sucks. I was actually hoping to get a rate around 5.5%-5.6% by june

[mauchow]

Don't let $20 extra per month shy you away from getting to where you wanna be!

[stevew]

lol

If you're buying 500k worth of mortgage, then it's about a 200 dollar difference between 5.5 and 6.2%. I mean, yeah, that's a lot of money over the long haul, but sure the hell has got to beat the fuck out of renting another year. Of course, it's dramatically more if you're looking in the millions.

[Galaril]

Well, to be honest yeah I never really figured out the differnce on a 420,000 dollar loan for a 30 year fixed but I guess you are right. Still I am pretty sure it is a hell of alot more 20 dollars a month. I think it is more like 200-300 more amonth which will kind of put us over where are wanting to be on monthly basis. i guess in the end I will bitch and moan like true Northeastern and take it up the tailpipe and pay out.

[k0ruptr]

nike says just do it.

[Marc Vaughan]

I think quite frequently when you get your first mortgage you tend to stretch yourself to do it .... I've never regretted purchasing my house though despite that.

(but at the moment in America depending on where you are you might want to hold tight and see if prices drop a little further still ...)

[Flasch186]

And rates very likely may come down, quite a bit even, if youre waiting until spring.

Rates jumped due to an overheated inflation report BUT these reports are revised all the time and one blip on the radar doesnt mean inflation is soaring. Hang tight and see what happens to rates in January.

My personal belief is that the FED has a long way to go when it comes to rate cuts BUT I have no information other than what I read and watch. Do your own DD.

[cougarfreak]

It's all part of the game.......you took a chance by waiting. You are losing at this point (if that's what you want to call it). Who knows, the rates might go down by this spring when you are ready, but you are taking a chance they might even go higher by waiting.

[PilotMan]

Honestly in the grand scheme of things hoping that rates drop back down to all time lows is a bit of a stretch. Even at 6 or 6.25 they are still much lower than they likely have been for the majority of your life.

Despite needing a house, we just can't afford it. And believe me, watching prices go down and now interest rates go down again really has me salivating. Someone get out there and tell by company that I deserve a raise so that I can get one!

[Qwikshot]

I locked in this April. I think I'm at 5.45%. My father was telling me when they bought their home in the mid-80's, it was at 18%? That's crazy.

[PilotMan]

The thing is that even though rates were really, really high, house prices were much, much cheaper. So I see it as more of a balancing act. I would expect rates to go up with prices declining. But so far that hasn't been the case.

[TRO]

Originally Posted by Galaril

Well, to be honest yeah I never really figured out the differnce on a 420,000 dollar loan for a 30 year fixed but I guess you are right. Still I am pretty sure it is a hell of alot more 20 dollars a month. I think it is more like 200-300 more amonth which will kind of put us over where are wanting to be on monthly basis. i guess in the end I will bitch and moan like true Northeastern and take it up the tailpipe and pay out.

No, the difference on a 420,000 principal (assuming this is the mortgage balance after down payment) is about $63 at those interest rates.

[Logan]

Originally Posted by PilotMan

The thing is that even though rates were really, really high, house prices were much, much cheaper. So I see it as more of a balancing act. I would expect rates to go up with prices declining. But so far that hasn't been the case.

The lower prices were because everything else was cheaper back then. Rates are still historically low.

[WSUCougar]

Originally Posted by cougarfreak

It's all part of the game.......you took a chance by waiting. You are losing at this point (if that's what you want to call it). Who knows, the rates might go down by this spring when you are ready, but you are taking a chance they might even go higher by waiting.

Yup

And if you're going to be pissed at fluctuating mortgage rates, prepared to be a rather unmerry man.

[clintl]

6.125% is a lower rate than I had on any of my mortgages. You really, really don't know how good you've got it if you're complaining now - very low interest rates + desperate sellers = the ideal time to buy.

[cubboyroy1826]

As a mortgage broker i would not get too upset escpecially if you are working with a good broker. What i typically do for my clients is submit their loan to two different lenders. We will lock with one and float with the other. This way if rates get worse we are covered and if they get better we have lender B that we can go with. You have a lot of time before you are going to be closing and i would expect a couple more up and down moves on rates between now and then.

[Galaril]

Good points by all. It was just a bit surprising that's all. Considering all I have heard is it is a buyers market and waiting until spring is a good idea to see all of a sudden that the same "experts a re saying that the buyers will bear the brunt of the banks trying to recomp their losses " is a bit shocking. But, I guess as TRO stated the differnce a month isn't as much as I thought maybe only 63 bucks so that isn't so bad.

[cubboyroy1826]

One thing to be careful of is some new adjustments that Fannie Mae and Freddie Mac will impose on conforming (good credit) loans. If the credit scores are under 680 their will pricing adjustments (higher rates because of this). Man markets are also being hit with a 5% loan to value reduction because of declining areas. The declining areas are tough to figure because some lenders will say an area is declining while another will say it is fine. Bottom line is if where you are buying is stable you are fine and if your credit score is 680 or above you are fine.

[Galaril]

Originally Posted by cubboyroy1826

One thing to be careful of is some new adjustments that Fannie Mae and Freddie Mac will impose on conforming (good credit) loans. If the credit scores are under 680 their will pricing adjustments (higher rates because of this). Man markets are also being hit with a 5% loan to value reduction because of declining areas. The declining areas are tough to figure because some lenders will say an area is declining while another will say it is fine. Bottom line is if where you are buying is stable you are fine and if your credit score is 680 or above you are fine.

I am fine on both accounts I have a 800 credit score and we are looking in the denver suburbs which apparently has either already bottomed out years ago or never really had the problems other areas have I guess largely due to the exodus of people from Califronia out to Colorado area.

[Galaril]

Originally Posted by Galaril

I am really fucking pissed after just checking the interest rates for 30 year fixed mortagages were at 6.125% up form last weeks 5.895? WTF! I understand why the mortagage rates went up but I didn't see this coming and was getting ready this spring to buy our first family home in late spring May-June time frame. But, now I am doubtful and despairing that my wife and kids will be stuck for another year in the small two bedroom place we have been in waiting for the housing amrket to bottom out some before prurchasing. I am really bummed about this I mean I have excellent credit, some down payment money a plus 800 credit score and no debt yet I am looking at a plus 6% interest rate because people years ago who took mortagages they couldn't afford are now going belly up that sucks. I was actually hoping to get a rate around 5.5%-5.6% by june

Well, the rates are now in the 5.5% to 5.3% range so I will be looking to try to lock in soon. Wow, things really change quick. I am planning on holding off until either the nex Fed meeting at the end of January or once the rate hits 5.2% Like some mentioned above it isn't that big of a deal but when you tlak about 6.2 and 5.5 on fixed 30 year mortgage that is a huge differnce spread over 30 years time. We are actually planning for this home to the ones we stay in for at least 20 years.

[Flasch186]

rates might even be lower in a few months, although they could also be higher.

my bet is lower

[flere-imsaho]

That's deep, Flasch.

[Galaril]

Originally Posted by Flasch186

rates might even be lower in a few months, although they could also be higher.

my bet is lower

Yes, it sure sounds like they will be going lower. Now it is just a question of how much?

[JeeberD]

My wife and I just got pre-approved for a loan. Now she wants to start looking for a house already even though we wouldn't move in until June or July. Crazy woman, it's WAY too early for that!

[Galaril]

Originally Posted by JeeberD

My wife and I just got pre-approved for a loan. Now she wants to start looking for a house already even though we wouldn't move in until June or July. Crazy woman, it's WAY too early for that!

Actually for us, we started looking last year in January . Now for us we were researching an area -Denver area, that we never lived in or knew much about. So we really had a lot of prep work to carry out. We have made 3 trips out to look at areas that we want to live in possibly. Now we are planning on a last trip the first week of April to try to nail down a home to put an offer own for a June move.

[JeeberD]

We're planning on staying in the same city...it's all about finding a house that's right for us. I just don't want her to fall in love with a house next month when we don't quite have the money saved up for the down payment yet.

[Galaril]

Originally Posted by JeeberD

We're planning on staying in the same city...it's all about finding a house that's right for us. I just don't want her to fall in love with a house next month when we don't quite have the money saved up for the down payment yet.

I hear ya on that one.

[Galaril]

Well for anyone who has read my companion thread on the me getting laid off from my job tomorrow I now have to wonder about buying a home. Once I do get a new job which I am not too worried about getting something fairly quick I have one worry. I was talking toa friend who had a similar situation where he hada new job about 7 months and he had a very hard time getting a mortgage. So, my situation is a credit score about 800 and going to be putting a downpayment on a home but with a new job probably a matter of a month or so on the job before we are looking to purchase a home. Is there any chance of getting abnk/mortgage company to approve someone for a loan on a new home who just changed jobs?

[Cringer]

The wife (a realtor who seems to know her stuff to me, but what the hell do I know? ) says that if you are getting a job in the same field it should not effect you as much. You are totally change occupations then they don't like that much.

[Galaril]

Originally Posted by Cringer

The wife (a realtor who seems to know her stuff to me, but what the hell do I know? ) says that if you are getting a job in the same field it should not effect you as much. You are totally change occupations then they don't like that much.

Job wise it will be a better paying job and in the same field most definitely.

[Galaril]

Originally Posted by Galaril

I am really fucking pissed after just checking the interest rates for 30 year fixed mortagages were at 6.125% up form last weeks 5.895? WTF! I understand why the mortagage rates went up but I didn't see this coming and was getting ready this spring to buy our first family home in late spring May-June time frame. But, now I am doubtful and despairing that my wife and kids will be stuck for another year in the small two bedroom place we have been in waiting for the housing amrket to bottom out some before prurchasing. I am really bummed about this I mean I have excellent credit, some down payment money a plus 800 credit score and no debt yet I am looking at a plus 6% interest rate because people years ago who took mortagages they couldn't afford are now going belly up that sucks. I was actually hoping to get a rate around 5.5%-5.6% by june

Finally bought a new house in Colorado. We got a rate of 5.65 with points from the seller to buy it down for the first year to 5.50%. Overall, we are happy.

[Cringer]

Congrats. Pretty decent rate and being happy with the house is the most important thing.

[Flasch186]

im actually looking at refi-ing right now. Rates may go down over the next 6 months but we are IMO literally one bank failure or one dislocation away from rates jumping on us. Im going to try to lock in something under 5.75.

[BishopMVP]

Originally Posted by Flasch186

im actually looking at refi-ing right now. Rates may go down over the next 6 months but we are IMO literally one bank failure or one dislocation away from rates jumping on us. Im going to try to lock in something under 5.75.

VARIABLE RATE! VARIABLE RATE! (don't be a pussy)

[darkenigma510]

mortgage rates are still historically on the low end....

[JeeberD]

Originally Posted by darkenigma510

mortgage rates are still historically on the low end....

Yeah, my dad told me a couple of weeks ago that when he and my mom bought their first home back in the late seventies that their interest rate was 14%...

[sterlingice]

Originally Posted by BishopMVP

VARIABLE RATE! VARIABLE RATE! (don't be a pussy)

Doing some reading as we're knee deep in a house hunt right now and this message along with the timing just made me laugh heartily.

Seriously, tho, a lot of these pre-2008 threads are both scary and interesting in how the market has changed since then.

SI

[mauchow]

Yeah, our rate is close to 3% now...

[Flasch186]

I think I did pretty well prognosticating. At least I didnt MBBF it up.

[sterlingice]

Originally Posted by Flasch186

I think I did pretty well prognosticating. At least I didnt MBBF it up.

You've been quite good on the threads I've read. Kudos!

I was about to launch into my situation but I think I should just start my own housing thread rather than threadcrapping here

SI

[JPhillips]

I did a 55 day lock a couple of weeks ago at 4.25. I'd bet I'd be 4.75 or higher today. That's a lot of money over 30 years.

[sterlingice]

A 55 day lock?

SI

[cubboyroy1826]

JPhillips you would definitely be looking right around the 4.75% mark right now. Been a rough couple weeks on rates. Just make sure if you are getting close to the 55 days that your loan officer extends the rate lock.

[sterlingice]

Any thoughts on where rates are going right now in the near term (3-6 months)?

SI

[JPhillips]

Originally Posted by sterlingice

A 55 day lock?

SI

That means my rate is guaranteed for 55 days, so as long as the closing happens in that time period I am guaranteed that rate. To get that long of a lock I had to pay a higher rate than if I had a 30 day, but it will be more than worth it.

[JPhillips]

Originally Posted by sterlingice

Any thoughts on where rates are going right now in the near term (3-6 months)?

SI

Near term I can't see them dropping much. The markets are really spooked by tapering QE3 and the decision to taper won't come any earlier than September. As long as the threat is out there rates won't drop. In six months they may, but only if the economy starts to slide and QE3 is extended for some guaranteed amount of time.

[sterlingice]

That was kindof my read on things, as well. I'm just going to be slightly irrational about worries of rates going up. We're looking to buy in that time horizon and I don't really want to risk rates jumping, say, another point. However, I think as long as Bernake doesn't have a reason to go out and say something, rates should stay steady. I'm annoyed that I lost out on a 1/2 or 3/4 points but we weren't ready and so long as rates don't look poised to keep moving up, there's no reason to change what we're doing.

SI

[cubboyroy1826]

I would definitely say in the near term 3-6 months you are looking at rates in the 4.5-5% range but much longer term than that the general consensus is for higher rates. Our buddy Ben really spooked the bond market with his announcement of taper QE3 even though there was really no specific timeline given. The big problem is that one day of run up in rates can take 4 days to come back down. Lenders are quick to raise rates but very slow to bring them back down.

[Flasch186]

Originally Posted by sterlingice

Any thoughts on where rates are going right now in the near term (3-6 months)?

SI

I think by the end of the year rates are at or slightly lower from where they are now. I think youre just witnessing a knee jerk reaction to what everyone already knew was coming and then some gamesmanship and shaking out of weak hands. I believe we settle back down to a 10 year note yield closer to 2 than 2.5 by 12/31. Could be wrong though.

[JPhillips]

Originally Posted by sterlingice

That was kindof my read on things, as well. I'm just going to be slightly irrational about worries of rates going up. We're looking to buy in that time horizon and I don't really want to risk rates jumping, say, another point. However, I think as long as Bernake doesn't have a reason to go out and say something, rates should stay steady. I'm annoyed that I lost out on a 1/2 or 3/4 points but we weren't ready and so long as rates don't look poised to keep moving up, there's no reason to change what we're doing.

SI

I lost half a point by not being ready to buy in early May.