Welcome to Illinois Mortgage Rates and News week in review for the week ending October 31st, 2009, my take on the week’s financial news and how it affected Chicago Illinois mortgage rates.

This was a scary week in the markets with a good share of both tricks and treats. The week started out with the release of the Gross Domestic Product (GDP). The GDP, the measure of all the goods and services sold in the economy, grew by 3.5% in the third quarter of 2009. This news brought out the expected end of the recession talk, and the stock market surged on the news. But almost all of the increase was due to the cash for clunkers program and other government stimulus. The other reports released this week showed that the economy was still not quite in boom mode. The good news is that inflation is still not a problem. Personal income was flat and spending was down for September. Consumer confidence was down again, dimming the prospects for increases in consumer spending down the road. The /Case-Schiller Home Price Indices show that prices are still down, but the rate of decline improved compared to last month’s reading. This index has improved each month over the last 7 months. In Chicago home prices were up 2.7% over last month, but still over 12% down from where they were last year. By the end of the week, the stock market was falling and money flowing into the safer bonds. This means better mortgage rates for the week.

Some good news came out of congress this week. Congress passed an extension of GSE (Fannie and Freddie) and FHA loan limits through 2010 at the same level they are at now. This isn’t official yet, but assuming President Obama signs the bill, it will mean that conventional loan limits for single family homes will continue at $417,000 for conventional loans and $410,000 for FHA loans in the Chicago area. Last week the conventional wisdom was that the first time home buyers tax credit was likely to expire as concerns of the cost of the credit and the amount of fraud overshadowed the benefits. What a difference a week makes. This week the Senate took up the extension of the first time home buyers tax credit, and though it hasn’t passed yet, the word is that it will be extended and made available to move up buyers, too. So it is likely that the tax credit will be extended and expanded, helping the real estate market and letting more home buyers qualify through the beginning of next year. I’ll post more once the final bill goes through.

If you are in an FHA mortgage at 5.5% or higher, it might make sense to refinance your mortgage. Now. The rules for the FHA Streamlined refinance are about to change, making it harder to qualify. Getting in now gets you in before the deadline. If you are looking to buy a new home, the first step is a Chicago mortgage pre-approval, give me a call and we can get the process started.

Here are the current Illinois Home mortgage rates for an A+ (740 Fico or above), full doc single family home purchase or rate/term refinance on a 45 day rate lock, with 0 points, and no origination fee. The conventional and FHA rates are based on the highest conforming loan amounts, which give the best pricing. Again, there are many factors which affect mortgage rates and your ability to be approved for a loan. These rates may not fit your situation and this is just a sample of the programs that are out there. If you would like a quote for your personal situation, or to get pre-approved for a mortgage, give me a call or contact me (Illinois mortgage company) and I’ll take the time to find the rate and program that is best for you:

Conventional loans up to $417,000

30 year fixed rate              5.00%         5.168% APR

15 Year fixed Rate             4.375%        4.568% APR

5-1 A.R.M.                         3.875%        4.067% APR

For Jumbo loans over $417,000

***************** SPECIAL JUMBO PRICING ****************

30 Year Fixed Rate*          5.875%        6.093%*

This 30 year fixed Jumbo is special pricing based on a purchase up to 75% LTV or a refinance to 70%, 680 or better Fico scores. Other restrictions may apply.

**************************************************************

7-1 A.R.M.                        4.875%         5.095% APR

(Another option is to break your Jumbo loan into 2 parts – conventional to the limit of $417,000 and a HELOC or fixed second mortgage for the rest. The blended rate is usually much better than a single loan would be.)

FHA LOANS – 3.5% down payment – FHA Maximum varies by County

With 1 point origination fee – 45 day lock

30 year fixed rate              5.00%       5.478% APR

With no origination fee – 45 day lock

30 year fixed rate              5.25%      5.473% APR

FHA APR reflects 3.5% down payment and the effect of mortgage insurance on the loan. Call for information on no-cost FHA streamlined Refinances

Call for quotes on FHA 203K Rehab Loans

VA Veterans Administration 0 Down Loans

With 1 point origination fee – 45 day lock

30 Year Fixed Rate            5.25%       5.437%

Call for information on no-cost VA Streamlined Refinances

These are just a few of the mortgage programs and mortgage rates available. Which option is best for you depends on your own specific goals and needs. If you have any questions or want to go over your situation in depth, let me know how I can help.

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