Illinois Mortgage Rate Weekly Update

Are You Thinking About Buying a Chicago Area Home in 2017?

                    With 2016 behind us, and the beginning of 2017 underway, many folks take a step back and look at their New Year’s resolutions and what they would like to accomplish in the coming year. While reflecting on their aspirations for the year, many renters and first-time buyers have the goal of purchasing a new home in 2017. If buying a home is one of your New Year’s resolutions, take some time to figure out and assess where you are now, and where you need to be in order to buy a home. Doing an assessment with a qualified mortgage loan officer will help you determine where you are at financially, and things you can to do to help you prepare to buy a home. Examining Your Savings, Debt and Credit An important aspect of your financial picture is your amount…

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Average U.S. Mortgage Rate Drops This Week

The average rate for a fixed mortgage in the U.S. fell, yet again, this week making it the fifth week in a row for the drop. Although the home-buying season for spring has gotten off to a slow start, the low rates might just help. On Thursday this week, Freddie Mac said that the “average rate for a 30 year loan came down to 4.12 percent from 4.14 percent last week. On a 15-year mortgage, the average rate dropped to 3.21 percent from 3.25. With Spring in full swing, the warmer weather actually has yet to increase home sales as it usually does. The higher interest rates and rising prices that began mid-2012 made home sales an unattractive market for potential home buyers. However, we find that there are actually less homes with available to purchase with new construction redirecting their focus from single-family homes to rentals. The price of…

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Housing and Debt Ratios: How Large of a Mortgage Do You Qualify For?

Ratios are a big factor in the size of the mortgage you qualify for. There are actually 2 ratios we look at. The first, the housing ratio, is a measure of your total housing cost compared to your monthly income. The housing figure includes all the normal monthly costs of owning a home: the principal and interest payment, the monthly taxes and insurance, mortgage insurance, and the association fee if it’s a condo or townhouse (we’ll get into this more, later). The second ratio is the total expense ratio. This measure includes not only your housing expenses, but all your other monthly debts, too. So this takes into account all your minimum credit card payments, car payments, student loans, any alimony or child support, and the like. (There are some obligations that you are required to pay, things like car insurance and day care for children, that don’t count in…

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Preparing to Buy: Dealing with Credit Problems

So what happens if your credit isn’t the best? If you’ve had major credit problems in the past, or if there is inaccurate information on your report, this may affect your ability to buy. Your situation depends on what the problem was, and how long ago it occurred. If the problem was from years ago, you might be surprised at what we can do. But even if it’s a more current problem, there are options. FHA, a government program, is more lenient of past credit mistakes, and can be a great option for many situations. We’ll discuss this in more detail later. It also depends on the specific circumstances of your situation.  Many people think that after a bankruptcy, for example, they won’t be able to buy a home again. But depending on the causes, you may be able to buy, at good rates, as soon as two years after…

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Economic Trends – Chicago Illinois Mortgage Rates Week in Review for the Week Ending 05/03/2013

While we have seen rate increases in the early part of 2013, the end of April showed record lows for the year so far. Finance reporters and rate strategists watch the economic trends, they are discussing a casino-like scenario where buyers are gambling to hold out for a better rate or lock in the current ones. To further assist the market, new mortgage delinquencies are at 6 year lows which should help to gently apply the brakes to the foreclosure situation that has kept home values at bay; although the effects will take a while to ripple through the system. There is still a major foreclosure buying opportunity in the marketplace. Estimates still have foreclosures representing over 40% of home sales here in the Chicagoland area, but the number is heading downward. Factors that cause light volatility in mortgage interest rates will continue for the near future. The jobless numbers…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 03/01/2013

Mortgage rates have steadily risen since the beginning of the year as signs showed the U.S. economy was growing, and the global economy had stabilized. A big part of the renewed optimism was the view that Europe was on the mend, and through selective austerity, the European Union would hold together and the status quo would survive. Well, what goes up comes back down, old is new again and Europe is back in the headlines. The focus now is Italy, and the election results last week showed that it may be a while before they find a true solution to the European economic crisis. In an upset of expectations, the biggest winner in the election was a comedian leading an anti-establishment party. The right and left wings split, and in Italy’s parliamentary system, it looks doubtful that anyone will be able to make alliances to form a working government. This…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 02/01/2013

The consensus in the markets now, is that the worst of the decline is behind us, and the economy is on the mend. The economic data last week was mixed. Reports showed that the overall US economy shrank in the last quarter of last year, the first time we have seen a fall in the last 3 years, with GDP coming in .1% lower than the previous quarter. But this was mostly a result of a drop in government spending, and private industry continues to grow. The Case Schiller home index shows housing prices are moving higher, consumer confidence came in strong and China came in with strong manufacturing  numbers, another indication that the global economy is better than expected. The Big Kahuna of reports is always the monthly jobs report, and this month showed an increase of 157,000 jobs, while the unemployment rate ticked a touch higher to 7.9%….

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 01/25/2013

Mortgage rates blipped sharply higher last week after a trifecta of optimism hit the market. One of the biggest reasons interest rates are so low, is because of fear that the European Union is, and has been, on the verge of collapse. To stave off the collapse the ECB, Europe’s version of the Fed, lent out cheap money to banks throughout the continent to maintain liquidity in the system. Last week they announced that more than half the banks participating in the program will be paying off the loans as soon as they are contractually able to (this week). That is much better than expected, and a sign that the overall economy is in much better shape than has been projected.Rates dropped into their lowest range when the markets expected that the European Union was about to collapse, so this good news is indeed bad news for the lower trend…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 01/11/2013

For a good part of last year, the financial markets moved up and down based on whatever was happening in Europe. The problems there aren’t fixed, but this has moved firmly to the backburner as all the attention now is focused on our own political issues. We have been muddling along and the US economy has been slowly but steadily improving, and unemployment has slowly but steadily been dropping. The biggest crises we have now seem to be of our own making. We came into the New Year courting disaster, and ground the brakes down to dust as we stopped just short of the fiscal cliff. The agreement didn’t really end anything though, it just forced a break in the action so the two political parties could re-group for the next battle. For our next crisis, we are bumping up against the debt ceiling again and this will have to…

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Chicago Illinois Mortgage Rates Week in Review for the Week Ending 12/29/2012

Happy New Year! Buckle up, it looks like we are going cliff diving. The two parties in Washington are holding hands, Thelma and Louise style, and punching down on the accelerator as they go over, saying goodbye to 2012. Do you ever wonder how much better our economy would be if it wasn’t held back by a completely dysfunctional government? This latest crisis is almost exactly mirroring what happened a year and a half back when the congress and president couldn’t come to an agreement on raising the debt ceiling on time, and as a result Standard and Poors lowered the US credit rating. The good news then was that the investing world ignored the rating drop, US bonds are still considered the safest in the world and rates have dropped sharply since then. The good news now is that even though we are almost surely going over, this is…

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