Average 30-year mortgage rate up to 4.12%

WASHINGTON (AP) – Sept. 12, 2014 – Average long-term U.S. mortgage rates rose slightly this week but remained near their lows for the year.
Mortgage company Freddie Mac said Thursday the nationwide average for a 30-year loan edged up to 4.12 percent from 4.10 percent last week, where it had stayed for three straight weeks.
The average for a 15-year mortgage, a popular choice for people who are refinancing, rose to 3.26 percent from 3.24 percent.
At 4.12 percent, the rate on a 30-year mortgage is down from 4.53 percent at the start of the year. Rates have fallen even though the Federal Reserve has been trimming its monthly bond purchases, which are intended to keep long-term borrowing rates low. The purchases are set to end next month.
Mortgage rates often follow the yield on the 10-year Treasury note. The 10-year note traded at 2.54 percent Wednesday, up from 2.41 percent a week earlier. It was trading at 2.53 percent Thursday morning.
To calculate average mortgage rates, Freddie Mac surveys lenders across the country between Monday and Wednesday each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.
The average fee for a 30-year mortgage was unchanged from last week at 0.5 point. The fee for a 15-year mortgage also remained at 0.5 point.
The average rate on a five-year adjustable-rate mortgage rose to 2.99 percent from 2.97 percent. The fee was stable at 0.5 point.
For a one-year ARM, the average rate increased to 2.45 percent from 2.40 percent. The fee held at 0.4 point.
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FHA to eliminate “post payment” interest charges

WASHINGTON – Aug. 27, 2014 – The Federal Housing Administration (FHA) today announced that borrowers who prepay their FHA-insured mortgages will not have to make interest payments beyond the date their mortgage is paid in full.
FHA's rule, Handling Prepayments: Eliminating Post-Payment Interest Charges, applies for FHA-insured mortgages closed on or after Jan. 21, 2015. This rule explicitly prohibits lenders from charging borrowers post settlement interest, which is broadly defined as a "prepayment penalty" by the Consumer Financial Protection Bureau (CFPB), for all FHA Single Family mortgage products and programs.
In addition, FHA announced a new rule to ensure borrowers have early access to information when making decisions about their FHA mortgages. Effective for FHA-insured Adjustable Rate Mortgages (ARMs) originated on or after Jan. 10, 2015, this rule makes two revisions to FHA's ARM Program. It requires lenders:
″ To provide borrowers with FHA-insured ARMs at least a 60-day, but no more than 120-day, advance notice of an adjustment to their monthly payment. FHA currently requires a 25-day advance notice.
″ To base an interest rate adjustment that results in a corresponding change to the borrower's monthly payment on the most recent index value available 45 days before the date of the rate adjustment (commonly referred to as a "look back period"). FHA currently requires a 30-day look-back period.
The new rules result from regulations in the Truth-in-Lending Act (Regulation Z) as revised last year by the CFPB.
© 2014 Florida Realtors®
 

U.S. home building down 6.5% in May

WASHINGTON (AP) – June 17, 2014 – The pace of U.S. home construction slipped in May with many Americans still struggling to afford new houses.

Builders started work at a seasonally adjusted annual rate on 1.01 million homes last month, the Commerce Department said Tuesday. That was down 6.5 percent from 1.07 million in April.

Construction firms began work on fewer single-family houses, condominiums and apartments last month.

Home construction has struggled to gain much traction this year, limiting its ability to contribute as much to broader economic growth as it has in the past. Many would-be buyers face higher mortgage rates than at this time last year, while builders are selling fewer new homes but charging more for them. That has reduced the number of possible buyers and the number of construction jobs. Builders employ 1.49 million fewer workers than they did at the start of the Great Recession in December 2007, a loss of roughly 20 percent.

"We expect housing to contribute positively to 2014 economic growth, but the magnitude of its contribution likely will be much smaller than that reported for the past two years," said Dana Saporta, director of U.S. economics at the bank Credit Suisse.

In May, construction trailed off in the Northeast, Midwest and West. Only the South experienced greater building activity in May.

U.S. home building down 6.5% in May