Chang Team Loan and Mortgage Services

Fed Rate Lowered vs. Mortgage Rates Unchanged

Annie Chang — Wed, 18 Sep 2024 19:59:26 +0000

Today, the Federal Reserve cut the overnight interest rate by 0.5% the first time since 2020 as inflation trends move closer to the Fed’s target, signaling a positive shift in the economy. Mortgage rates had already adjusted prior to this rate cut and have remained relatively steady since, as they are driven by factors beyond the Fed’s control, such as long-term economic outlooks and market demand. For potential homebuyers, this means that despite the Fed’s rate cut, mortgage rates may not drop significantly, making now an opportune time to purchase a home soon. With demand for homes already high, waiting could lead to bidding wars and higher prices. Acting sooner rather than later can help buyers secure their ideal home without the pressure of increased competition.

Buying a new home and would like to know how much you can qualify for? Or perhaps, you are looking to consolidate your revolving and/or installment debts, improve your home or access your equity from your home for the next investment. Contact me at 925-216-3618 today!

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Market Updates – May 1, 2023

Annie Chang — Fri, 05 May 2023 20:10:13 +0000

There is some big news this week. First started with First Republic Bank is sold to JPMorgan Chase Bank on Monday, May 1, 2023. First Republic was funded in 1985 and the 2^nd largest U.S. bank by assets to breakdown after Washington Mutual which was also took over by JPMorgan Chase Bank. Fed increased the overnight fed funds rate another 0.25% yesterday, May 3, 2023. Weekly initial unemployment claims increased to 242,000 in the week ending April 29, 2023 which is an increase of 13,000 from the previous week.

What about mortgage rates? 30-year fixed rates hit 3 weeks lows. Bond market likes the Fed’s hike on Wednesday. That means Fed is attempting to cool the demands for goods and services, therefore, reducing the inflation numbers. Additionally, the message from this week’s meeting conveys this could be the last hike for a while which is a good signal that the Bond market was waiting on.

What happens next? Consumer Price Index (CPI) data will come out next week that can potentially move the mortgage rates even lower. It’s a great time to review all the mortgage payments (especially if you have home equity line of credit), revolving debts and installments. Let’s save you money next month!!

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Market Updates – March 20, 2023

Annie Chang — Wed, 22 Mar 2023 20:15:14 +0000

Recent news of Silicon Valley Bank and Signature Bank collapse has caused investors questioning the US economy. Fed increased the overnight fund rate for another 0.25% on March 22, 2023 which marks the highest point since September 2007. Here is the complete press release from Federal Reserve. Federal Reserve Board – Federal Reserve issues FOMC statement

What happens with mortgage interest rates today? The announcement provides a moment of relief for many lenders who have increased the mortgage rates prior to the Fed meeting on March 22, 2023. After the statement from Fed, lenders have moved mortgage rates lower across the board. There are still many data that will impact how interest rates determined and which direction it will go.

As the golden rule, ALWAYS contact me at 925-216-3618 to find out how much you can qualify for and all the available programs that will best suit your needs.

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Reduction of FHA Annual MI Rates

Annie Chang — Tue, 28 Feb 2023 20:14:36 +0000

Awesome news!! Borrowers would like to utilize FHA(Federal Housing Administration) loans to purchase homes or refinance their current loans. HUD made an announcement on Feb 22, 2023, the Annual Mortgage Insurance Premium (MIP) will be cut by 0.3% from 0.85% on the loans endorsed on and after March 20, 2023. The annual MIP will depend on the base loan amount, loan to value and the terms of the loans. For the details of FHA annual MIP, the announcement is at 2023-05hsgml.pdf (hud.gov).

What does that mean if you are looking to purchase a home? You may qualify for a higher purchase price. Call me at 925-216-3618 today and see how much you can qualify for!!!

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Market Updates – January 30, 2023

Annie Chang — Fri, 03 Feb 2023 23:43:19 +0000

Fed rates increased another 0.25% moving the overnight Fed Fund rate to 4.5% – 4.75%, the highest since October 2007. The marks the 8^th increase since March 2022. For many homeowners who have a home equity line of credit loan, you will see a monthly interest payment increase as the Prime Rate is now at 7.75%, comparing with 3.25% a year ago.

What happens to mortgage rates? Very IMPORTANT note, the mortgage interest rates do NOT increase because of Fed Fund rate increases. Mortgage-Backed Security (MBS) plays a huge factor on the mortgage rates. Each MBS consists a bundle of home loans and other real estate debt bought from banks that issued them. Investors in MBS receives periodic payments from them. Inflation is another important matter that reflects on the mortgage rates fluctuations. Inflation numbers represents the purchasing power of dollars over time. Mortgage lenders have to maintain mortgage rates at a level sufficient to combat and overcome the inflation level to ensure a profit. As the latest inflation figure from December 2022 shows 6.5% is the lowest since October 2021, the 30-year fixed rate mortgage rate has also dropped off from the highest point of 7% in October 2022. Economic growth, housing market demand and supplies all come into play when we discuss mortgage rates.

Future outlook? As the inflation numbers are more in control (or “disinflation” as Chairman Powell pointed out), we will see mortgage rates are more stabilized. Perhaps a good possibility of trending down is in horizon. More buyers will result from more favorable interest rates with higher purchasing power. Once the weather gets warmer, more housing inventories will also increase.

Ready to qualify? Contact me today at 925-216-3618 for more information.

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