fannie mae cracking down on low credit borrowers

Fannie Mae has come out with new price hikes to their mortgage rates for those borrowers without perfect credit. Up until February if Fannie would approve the loan, everyone got the same rates. Now Fannie may approve someone, but if their credit score is below 720 (which is really excellent credit) they will have a higher, and sometimes much higher, interest rate.

So for all the media hype of making loans better and more affortable, here is the largest GSA doing the exact opposite. I'm not saying that it doesn't make sense, only that the media needs to get it right.

let me know what you think

Bill

rates up, rates down

They did come up on Friday, and now they've come back down some. A lot of news is coming out this week so it will continue to be very volatile.

rates likely will rise

Unfortunately my earlier prediction of where rates were headed on Tuesday missed the target. Upon news that the Fed is cutting rates next week by an expected 1/4 point, rates bounced up 1/8th today. Still pretty low, right around 6.25% but certainly not the lowest they've been.

Bill

100% hard to find

PMI (Private Mortgage Insurance) companies are tightening up their standards after getting hit with some heavy losses due to the national foreclosure problem. While conforming loan underwriting standards still techincally allow for 100% or zero-down loans they do require mortgage insurance. Roughly a month ago the PMI providers decided it was in their best interest to stop writing policies unless a buyer puts at least 5% down. So while 100% loans used to be quite the norm, now they're non-existant.

Although this does hurt some buyers trying to buy a home, overall it's good for the industry as the added oversight will certainly allow fewer bad loans to get approved.

Enjoy your Wednesday,
Bill

Rates dipping slightly

Mortgage rates have risen in the past 7 days but have shown signs of falling yesterday and today. Currently they're 6.125%. I'm hoping that they'll come down to 6% by the end of the week.

crossing my fingers!
Bill