Connecticut Mortgage Rates and Financing Update October 14, 2011

This Week's Financial News

Paperwork, paperwork, and more paperwork. Why do well qualified borrowers have to supply so many documents that are not income and asset based?   Fannie Mae and Freddie Mac are increasingly demanding sellers ( your lenders)  repurchase mortgages that default years after they were made and buy back recent loans that aren't even delinquent, according to PHH." "They're casting the net wider," Luke Hayden, head of PHH's mortgage unit.  Which means, the banks have to buy back the mortgage debt and have less money to lend.  And with the threat of a buy back on a mortgage, the banks (sellers) want to make sure everything is documented by the borrower.  The indication is, it is only going to require more paper work from borrowers to qualify for a mortgage.

Today the Fed will announce how much money it will have to reinvest into the Mortgage Backed Securities market from mid-October through mid-November. Estimates are around $22 billion which translates to about $1.1+ billion per day. This scenario with mortgage banker supply holding in the $1.5 to $2.0 billion area equates to the Fed taking between 73% and 55% of daily supply. This is a more favorable demand dynamic versus last week when supply hit between $2.5 and $3.0 billion in a couple of sessions.
 

With Bank of America leaving correspondent, is someone like Chase going to be next? There is a big difference between hallway chatter and headlines of "MetLife May Sell Mortgage Business" in Bloomberg! "Chief Executive Officer Steven Kandarian, who took the job in May, is planning to exit a business that expanded in June when it replaced Bank of America Corp. as the preferred lender of builder KB Home...Keeping the mortgage unit could divert "resources away from MetLife's primary focus on its global insurance and employee benefits businesses," the New York-based company said in a statement.  Let's sum things up, given the investor scuttlebutt from the national Mortgage Conference this week and general rumors, possible half-truths, and outright misstatements. MetLife is/was a solid competitor for wholesale broker business in many parts of the nation - maybe someone like Fortress will buy the mortgage group. Bank of America will soon be strictly retail, and only in some states. Chase does not buy third-party originated production, i.e., broker business, from clients. GMAC, PHH, and SunTrust have varying degrees of operational hurdles, and only buy loans on a mandatory basis one at a time or not at all, and have varying degrees of tolerance for buying loans from smaller companies offering correspondent relationships. Are they ready for all this volume? Looking at the top correspondents, volume-wise, so we have Wells Fargo, which is grappling with purchase turn time days into the teens, CitiMortgage, U.S. Bank, Flagstar, Franklin American, and BB&T. Rumors of higher capital requirements for correspondent sellers are rampant.

Too much competition is one thing, but does the industry really need fewer players? Besides making things easier for pricing engines, will the borrower be better off? Let's ask the protesters about unintended consequences.

Today's Mortgage Rates

30 year fixed - 3.99% + 0 cost points for rate
20 year fixed - 4.00% + 0 points for rate
15 year fixed - 3.375% + .50 points for rate
10 year fixed - 3.250%  0 cost points for rate
5/1 ARM - 2.750% - 0 points for rate
7/1 ARM - 3.00%  + 0 points for rate

FHA/VA
30 year fixed - 3.875% with 0 points for rate
5/1 ARM - 3.00 with 0 points for rate
7/1 ARM - 3.50 with 0 point for rate

Jumbo - over 635,000 to 2,000,000
30 year fixed - 4.50 % with 0 points  for rate
15 year fixed - 4.250% with 0 points for rate
5/1 ARM - 3.250% - 0 points for rate
7/1 ARM - 3.625 % - 0 points for rate

10/1 ARM - 4.375% with 0 points for rate

Jennifer Buchanan,  Certified Mortgage Planning Specialist at MetLife Loans is a seasoned veteran of the Mortgage, Banking and Broker Industry and specializes in mortgage loans throughout Fairfield County, Connecticut.
   Her attention to detail is unsurpassed, and her understanding of the marketplace makes it easy to find the right loan to fit her clients specific needs .  Jennifer's local processing and closing team are also known for their exemplary service.
   Understanding that the vast majority of mortgage brokers never discuss the long or short term  financial needs or goals with their clients, she set herself apart from the rest by obtaining the coveted CMPS  designation. (Certified Mortgage Planning Specialist)
    She is a member of the National Association of Responsible Loan Officers, and her commitment to ethics, understanding of the marketplace, and business acumen have earned her the respect of her peers and clients alike.

Jennifer Buchanan
Metlife Loans
203-341-6949

Jennifer Buchanan- Your certified expert
 on mortgages offering Free Unbiased
recommendations based on your needs.