July 2012

Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/27/2012

Mortgage rates have been exceptionally stable over the last month, moving back and forth within the lowest historic range, ever. On Friday rates bumped higher to the top, though still within this historically low range. Has anything fundamentally changed? It all comes down to perceived risk. Mortgage rates have stayed so low because investors are more worried about keeping the money they have, than in making higher returns. The focus has been on Europe and the risk of the Euro’s collapse. With so much uncertainty, it is safer to hold money in bonds (like mortgage backed securities) than to risk major losses with stocks. For more than a year now, Europe has been on life support. Every time something happened that was supposed to fix the crisis, it would foster optimism and money would flow toward riskier and potentially higher returns, before fear reasserted itself, and money flowed back to…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/20/2012

With more evidence that the economy is slowing, Europe is still not fixed and the Chinese economy is also downshifting, mortgage rates are again dropping to all time lows. Fear is again in the air, and money flows away from anything considered risky, which benefits first US treasury bonds, and then mortgage backed securities which are considered nearly as safe, but pay a higher yield. The economy is still growing, but the growth has been slow, and it is getting slower. The GDP for last quarter will be released later this week, and expectations are for an annualized rate of 1%. The FED is still waiting in the wings, and the financial markets are waiting for any news that a new round of Quantitative easing is on the way. At this point it isn’t really a matter of IF they will do this, but WHEN. If they release it now,…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/13/2012

This was a slow week for news and economic reports, and it seems we have hit the slow days of summer a little early this year. The trend in mortgage rates is slowly moving lower. Last week we saw the best rates ever, before pulling back somewhat on Friday. The focus is still on the world economy, and while there wasn’t much news from Europe last week, some of the worry has shifted further east to what is happening in China. China has been on a tear for years, but they are starting to stall. The numbers they release have never been reliable, but the fact they have cut their interest rates twice in the last month, tells us that the government is concerned. Part of this is a result of the slowdown in Europe, which means less exports for them, but a big part has to do with their…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 07/06/2012

Last week was a little bit strange, having the 4th of July fall on Wednesday.  was nice having a break in the middle of the week and the fireworks were the same as they always were, but it didn’t feel like Independence day. This last week was also a bit strange because for the first time in a while, the focus economically was off of Europe, and the spotlight was trained here on the United States. The jobs report on Friday was a big mover, but the fireworks started earlier in the week with the release of the ISM manufacturing Index, a measure of strength in the manufacturing sector. Manufacturing as a whole has been a steadily smaller portion of our overall economy, but over the last few years our manufacturing industry has been relatively strong. Last week the ISM index showed a contraction for the first time since the…

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Chicago Home Market- Strong and Getting Better

  The housing market in the Chicago area is comparatively strong, and gaining strength. That’s the news from the National Association of Realtors, which released a report on home sales last week. While national sales of previously occupied homes dropped slightly, the Chicago area found a significant increase in sales in May, compared to April. The price also edged up, though only negligibly, at .1 percent to $170,000. Some communities in the south Chicago suburbs saw even greater increases than average. Tinley Park saw sales of existing single family homes double in May, though the sale price was down, meaning that the newly bought homes were more affordable. Oak Lawn saw a 32% jump in sales with the price declining even further for homebuyers. Nationally, buyers have been increasing over the past year; sales have risen almost 10% from last year, showing that here is a slow, but steady, improvement…

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Great News for Chicago Area FHA homebuyers – Rule to Require Payoff of Medical Collections is Overturned

FHA Guidelines Great news for any prospective Chicago area homebuyer who have more than $1,000 in medical debt. The Federal Housing Administration (FHA) is backing off from their previous plans to deny applications for those with major medical debt. The previous plan was supposed to go into effect in April, but was then put on hold until July. This plan was sure to hurt many other wise well qualified potential homebuyers, would have disqualified people with more than $1,000 in medical or other collections from getting a FHA-backed mortgage. However, the FHA rescinded the decision last week which means that those with medical debt can still qualify for a FHA loan. Understanding your credit score is important and there is definitely some good news for homebuyers in the Chicago area. A provision like the proposed one would have hurt many home buyers because medical debt is a common occurrence. Many…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 06/29/2012

The big news was out of Europe. Again. And with new money flowing into the banks of the hardest hit economies, disaster is averted. Again. This seems a lot like Deja Vu, a feeling we have been here before. But it may be different this time. Again. The European Union met for another economic summit on Thursday, and surprised everyone by releasing a plan that will actually help, at least in the short term. The speculation was that the situation in Europe was close to hopeless, as the interests of the money powers, especially Germany, were so far removed from the needs of the distressed economies like Spain and Italy (Greece is in a class by itself). So it came as a surprise when the meeting produced an agreement for the EU to use its funding authority to lend directly to banks in the troubled countries without increasing the debt…

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Chicago Area Mortgage Refinance – Articles of Interest

Chicago Mortgage Refinance Taking Time to Clear Several financial institutions are facing stockpiles of mortgage applications as Chicago homeowners take advantage of low interest rates and the Home Affordable Refinance Program.  According to a Mortgage Bankers Association survey released Wednesday, nearly 80 percent of all mortgage applications are for refinancing.  For mortgage applicants not taking advantage of HARP, experts recommend borrowing from a community bank as the waiting times for approval are not as long. FHA Streamline Refinance to Help Chicago Homeowners In June, the FHA began a new program that will help from owners with FHA mortgages save a lot of money. The new FHA program will allow borrowers who currently have an FHA mortgage to refinance with today’s record low rates, and keep their mortgage insurance at the same rate they started with even though the FHA mortgage insurance premium now is much higher. The catch is, this…

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