Welcome to Illinois Mortgage Rates and News week in review for the week ending November 20th, 2009, my take on the week’s financial news and how it affected Chicago Illinois mortgage rates.

Mortgage rates are still holding near the lowest rates of the year. These low rates are compounding the experts. The stock market shows signs of faltering, but it is still up near the highs for the year. Oil and gold have had major run ups, and the dollar keeps getting smacked around on the currency market. The government holds new auctions for debt nearly every week and the money supply continues to grow. The economy is still soft, but we are long past the panic and slowly moving forward. At the same time, the Fed is nearing the end of its commitment to buy mortgage backed securities to keep rates low (the Fed has purchased over $1 trillion out of $1.25 trillion promised). All these are usually signs that inflation is heating up, and that mortgage rates should be rising. But rates stayed flat this week, near the lows of the year. What gives?

I think Fed Chairman Ben Bernanke summed it all up in a speech he gave last Monday on the outlook for the economy. In the speech he said that the improvement in the economy is real, but there are some serious issues that need to be addressed going forward, and the recovery won’t be a strong one. As problems, he singled out the lack of credit and how banks are still not lending like they should, and how high unemployment will continue to hold the recovery back. Inflation is likely to be subdued for some time, he said, because of excess slack (more supply than demand) in the world economy. Inflation isn’t likely to be a threat until these factors stabilize. The way I see this, when the credit bubble popped, the economy imploded and left us in at the bottom of a big hole. We need to fill in the hole before worrying about how high of a hill we are building. If the Fed continues to keep short term rates low (which they said they will) mortgage rates should stay in a low range, too. We all know that rates will rise sometime, and when this happens it will likely be quick and brutal. But for now rates are great, and I expect we will stay in a good range (but probably not as good as where we are now) for a good part of the new year.

With Thanksgiving on Thursday, this is a short week for the markets. Most of the activity will be on Monday and Tuesday before traders leave early on Wednesday for the extra long week. Existing home sales, the GDP, and consumer confidence measures will all be released this week, as well as several new auctions of government debt. With the shortened week expect more volatility in mortgage rates. Let me know if I can help you with refinancing your current mortgage, or helping you with your loan when you buy a new home. The New Home Buyer Tax Credit extension is expected to keep the real estate market hopping throughout this winter. If you are looking for mortgage pre-approval anywhere in the country, 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              4.875%         5.078% APR

15 Year fixed Rate             4.25%         4.367% APR

5-1 A.R.M.                         3.75%        3.867% 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              4. 875%       5.369% APR

With no origination fee – 45 day lock

30 year fixed rate              5.125%      5.326% 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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