The Chicago 77
Comprehensive Chicago Real Estate Information

11 March 2011 – This week I feel a bit like Oliver Twist with my bowl outstretched in front of me as I beg for more. The lack of upward movement alone should be considered stupendous, but we actually saw a nudge down in pricing. I cannot, however, get past the belief that we should have seen more as global and domestic economies sent strong signals of a sputtering recovery.

Early in the week, we saw a flight to safety as the market fully digested the previous week’s employment report. This movement to the bond market continued as worsening employment, fear of Spanish debt default and an ever-worsening Middle East situation provided more incentives to find safe havens for investment and a 10-year Treasury auction provided more opportunity. In the end, rates for the best-case scenarios hovered in the high 4% - low 5% range.

My mortgage rate lock advice is optimistic, but cautious. I am now recommending that my clients FLOAT regardless of closing date. This is, of course, with the additional advice that this opportunity will only reward those most vigilant borrowers who keep their ears to the ground for quick changes.

June 1, 2010
As of today, Fannie Mae will now be requiring all loan applicants to run a second credit report right before closing on a real estate transaction. Not only will the credit report be required with the original loan application, at closing Fannie Mae will now require a second report to be generated. If the credit score is one point lower than the original score the loan will not be funded. The loan will then go back to underwriting for further scrutiny. This is serious business for those purchasing a new home and are planning on moving in with new furniture. With this new policy it would be wise not to use any form of credit. For example, do not head out to Costco and run up a large bill and put it on your credit card prior to closing. A larger charge on a credit card can drop your credit score.