Mortgage Rates Around 5.25%, But Could Go Up Due to Decrease in Mortgage-Backed Bonds

June 24, 2009

Daily Mortgage Updates

A&N Mortgage Logo24 June 2009 ? Mortgage backed bonds opened down 6 this morning and continued to trend down to -16. The 30-year and 15-year mortgage rates are priced off of mortgage backed bonds, not the 10-year Treasury bonds as many consumers mistakenly believe. Stocks rose after an earlier report from the Commerce Dept. showed orders for durable goods unexpectedly jumped 1.8 percent in May, indicating business investment was starting to stabilize. This is opposite of Monday?s news concerning the World Bank which stated that the Global Economy will take longer to recover. So basically you have an up and down market with interest rates varying daily as the news reports come in. New Home Sales came in lower at 342,000 versus the expected 360,000. However, May sales are up month-on-month in Chicago. The pressure on new home sales comes from existing resales of foreclosures where many bargains can be found by today?s consumer.

One tip for today, when buying a condo in today?s market the FannieMae (FNMA) guidelines now have risk-based pricing if you do not put 25% down on the condo. What this means is that you will have a slightly higher mortgage rate?typically an additional .25%. Today?s 30-year fixed rate is at 5.25% but we may see it hit 5.375% if the bond market continues to slide.

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About Chris DePaepe

Chris is a lifelong Chicagoan who was born and raised on the Northwest side. She has a business degree from Rosary College in River Forest and a MBA in finance from DePaul University. She has been in the mortgage industry since July of 1996 and understands the importance of educating clients about the process of purchasing or refinancing a home. Chris?s education and customer service separates her from her competition, from taking an application at 11 p.m. to doing a closing in the convenience of your home, customer service is her #1 priority! With her extensive financial education she is able to pass along critical information to potential clients about mortgage interest and the differences between a 30, 25, 20 and 15 year loan. Chris will run every amortization chart and spend a great deal of time explaining the savings on your mortgage interest by showing actual examples. Also, most first time buyers do not understand the tax advantage of owning a home and she will break that down and show the actual tax advantage of owning a home versus renting. Chris prides herself on taking the time to fully educate every buyer so they are aware of the process from the beginning to the end without any surprises. Whether you are looking to refinance or purchase a home, understanding today?s market is extremely important to getting your loan approved. You can contact Chris 24/7 at chrisd@aandnmortgage.com, 773-305-7016, or 773-848-4144.

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