June 2011

Chicago Illinois Mortgage Rates Week in Review for the Week Ending 06/24/2011

For this week, the direction trend in mortgage rates is all about Greece. The Greek parliament is scheduled to vote on new austerity measures Wednesday, a precondition of any European Union bailout. It is almost guaranteed that this measure will pass, as Greece has no other real options, and Germany and France have made it clear that they will not sign on for any more debt relief if the measure doesn’t pass. The mobs in the street are not likely to appreciate this, and the investors in Greek debt aren’t happy either. Creditors, including all the big European and US banks, will lose about 70% of their initial investments. The Greek default has been like a slow motion train wreck, but as it unwinds, the focus will shift to other European economies, with the question being – Who is next? Greece is the focus now, but there is another crisis…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 06/17/2011

Mortgage rates are still very low and holding as the markets wait for a clear direction. Mortgage rates rose in the middle of the week but settled back to flat by the end of the week. Greece, and the state of the European Union is still the biggest worry. Last week there was rioting in the streets in protest to the the austerity forced upon them. There is no easy answer as to what to do with the situation there, and the union is being tested as the needs of the stronger countries don’t align with those of the weak. Germany and France delayed the crisis with news that they will offer additional support, but this is mostly a band aid, not a real solution. At some point this will come to a head, but for now the decision on what to do has been pushed back to July. There…

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Chicago Area Mortgage Pre-Approval, Do You Need a Second Opinion?

The first step in buying a home in today’s market, is to talk with a good loan officer and find out how much of a mortgage you can qualify for and if there are any obstacles you need to overcome before you will be able to buy. This usually starts out as a short pre-qualification phone call, but before you start looking at homes you need a full pre-approval where you supply all your income and down payment documentation, and have the loan officer run your credit and go through your file with a fine tooth comb to make sure there isn’t anything there that will derail the process down the road. Mortgages are readily available and the mortgage rates are great, but the truth is that each mortgage loan is being scrutinized now like never before. When the housing bubble was heating up, underwriting was too easy. Underwriting is…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 06/10/2011

Mortgage rates mostly moved sideways last week, in a market where there was not a lot of news. Still, rates are at their lowest point since last November, and near the lows for the last forty years. The question now is whether this is a pause before rates drop even lower, or with the end of Quantitative easing almost upon us, and with debt ceiling agreement still up in the air, will rates head back higher? The rate trend over the last two months has been toward lower mortgage rates, but there are still so many competing story lines, that it is hard to see which will hold the most sway in the financial markets. Unemployment claims ticked up again last week, extending the trend. In a major speech Fed Chairman Ben Bernanke said the economy was recovering slower than hoped for. He said what everyone already knows, that unemployment…

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Mortgage Rates Are at the Lowest Point for 2011 – Is There a Refinance in Your Future?

Did you miss out on refinancing last year when mortgage rates dropped to their lowest point in our life times? Last Fall, right before the Fed announced their last round of the Quantitative easing policy, mortgage rates dropped to as low as 4.00% (for the best qualified conventional loans). The consensus at the time was that the economy needed more juice to keep it growing, and that rates were likely to drop even lower still. If you had considered refinancing at the time and missed the boat back then, you know what happened next. The Fed started the Quantitative easing program which pumped more money into the economy. The financial markets switched on a dime and while the big fear before was that the economy was growing too slowly and unemployment was too high, the new fear was that with all this money washing through the system, inflation was about…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 06/03/2011

The news reported last week confirmed that that the economy is slowing and mortgage rates are continuing to trend down. Factory orders fell 1.2% in April, and the ISM manufacturing index, a sign of strength in the manufacturing sector, came in at 53.5 compared to 60.4 the month before, much lower than expected. But the capper was the release of the monthly unemployment report on Friday. New claims for unemployment benefits had spiked higher earlier in the week, so the expectation was that this would be a soft report. The report came in showing 54,000 new jobs created over the last month, and the unemployment rate rising from 9.0% to 9.1%. This is a big drop off, the previous months, and being that the economy needs to add about 125,000 jobs each month just to stay even, a very distressing sign. The fear now is that the economy has already…

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