Average US rate on 30-year mortgage drops to 3.84 percent

Enter your email address to subscribe and receive notifications of new posts by email.

Fitch Upgrades Freddie Mac’s Commercial Mortgage Special Servicer Ratings

NEW YORK–(BUSINESS WIRE)–Fitch Ratings takes the following actions on the commercial mortgage
servicer ratings of Freddie Mac’s Multifamily Division:

–Commercial mortgage special servicer rating upgraded to ‘CSS2′ from
‘CSS2-’;

–Commercial mortgage master servicer rating affirmed at ‘CMS2′.

The upgrade of the special servicer rating reflects the special
servicing group’s workout experience with multifamily properties
throughout the United States, proactive surveillance, efficient use of
technology for asset management, and effective internal controls. While
only two members of the special servicing team, who average over 30
years of experience, are actively working out defaulted assets, the
group has significant special servicing bench strength and management
depth among its 19 employees who are capable of working out loans should
defaults rise. Special servicing senior managers average 29 years of
experience and 12 years of tenure, while middle managers average 22
years of experience and seven years with the company.

The special servicing group is responsible for defaults within Freddie
Mac’s balance sheet portfolio which consists of 6,373 loans totaling
$70.3 billion as of March 31, 2015, as well as one CMBS transaction. The
group resolved seven defaulted loans for the 12 months ending March 2015
totaling $42.4 million, only one of which incurred a loss. Resolutions
included three full payoffs, three returned to performing, and one
discounted payoff for multifamily assets located in five states and the
outstanding balance of the loans ranged from approximately $280,000 to
$9.1 million.

The affirmation of the master servicer rating reflects Fitch’s
assessment of Freddie Mac’s core servicing competencies, including
primary servicer oversight, surveillance, loan accounting, and investor
reporting. Since becoming a rated master servicer, Freddie Mac has
appointed itself for the FREMF 2014-KX01, and most recently, FREMF
2015-KJ01 transactions. Future master servicing assignments are expected
to support new product initiatives such as small balance and affordable
housing transactions as well as balance sheet transactions of legacy
assets. In addition to the two CMBS transactions, Freddie Mac performs
the core master servicing, in one form or another, for its $55.6 billion
whole loan portfolio, a multifamily investment securities portfolio of
$23.4 billion, as well as its multifamily guarantee portfolio of $94.7
billion as of March 2015.

Both ratings consider the company’s financial strength backstopped by
the U.S. Treasury, knowledge of the multifamily lending environment
combined with the support of its seller/servicer network. Due to the
concentration of servicing for multifamily assets, servicer ratings are
limited to the ’2′ category.

Fitch’s servicer rating methodology is described in Fitch’s reports
‘U.S. Commercial Mortgage Servicer Rating Criteria’, dated Feb. 14, 2014
and ‘Rating Criteria for Structured Finance Servicers’ dated April 23,
2015, which are available on Fitch’s web site www.fitchratings.com.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria

Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375

Rating Criteria for U.S. Commercial Mortgage Servicers (pub. 14 Feb 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735382

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=990111

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND
DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING
THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS.
IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE
AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘.
PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS
SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS
OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES
AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF
THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE
RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR
RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY
CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH
WEBSITE.

Mortgage Rates Drop Most In 33 Weeks, Says Freddie Mac

Freddie Mac: Mortgage rates drop to 3.84%, lowest levels since May

Freddie Mac: Mortgage Rates Now Average 3.84%

Mortgage rates made their biggest 1-week drop since January, according to Freddie Mac.

This week’s Primary Mortgage Market Survey (PMMS) puts 30-year mortgage rates for conventional loans at 3.84%, on average — a drop of 9 basis points (0.09%) from the week prior.

Interest rates dropped for other loan types last week, too.

Rates for FHA loans, USDA loans, and VA loans each improved. VA mortgage rates remain the “cheapest” of the lot. It’s an excellent time to refinance your home, or complete the purchase of a new one.

Mortgage rates and APRs are firmly in mid-3s and mortgage lenders are approving more loans nationwide.

Click for a live rate quote.

Mortgage Rates Best In 3 Months

The average 30-year fixed-rate conventional mortgage rate dropped 9 basis points (o.09%) this week to reach 3.84 percent, on average, nationwide.

The rate — which is based on a survey of 125 U.S. lenders — is available to borrowers paying 0.6 discount points at closing, plus a full set of closing costs.

Closing costs vary by state and are highest in Texas, Alaska, and New York. Costs are lowest in Tennessee and Nevada.

Borrowers can elect to “waive” closing costs via a zero-closing cost home refinance in which the lender pays costs on a borrower’s behalf in exchange for a slightly higher mortgage rate.

A zero-closing cost mortgage typically raises the rate on a $250,000 home loan by one-quarter point.

Freddie Mac reports that 15-year mortgage rates dropped last week, too. The popular, shorter-termed loan shed 9 basis points (0.09%) to 3.06%, on average, nationwide.

Freddie Mac’s published rates are available to prime mortgage borrowers.

A “prime borrower” is defined as one with a credit score of 740 or higher; with a purchase downpayment of twenty percent or more; with a debt-to-income ratio which meets mortgage guidelines; and, with ample reserves to support a mortgage approval.

Loans for prime borrowers are loans made against single-family residences including detached homes, certain town homes and attached properties; and condos which meet minimum eligibility standards.

The Freddie Mac survey does not reflect FHA mortgage rates or VA mortgage rates, nor does it show rates the for no-money-down USDA loan.

Freddie Mac’s figures are for conventional loans only.

Click to get a rate quote now.

Millions Now ”In The Money” To Refinance

Freddie Mac puts this week’s average mortgage rate at 3.84%. In historical context, this is dirt-cheap. Since 1971, 30-year rates have averaged closer to 8.25%.

However, rates aren’t just cheap as compared to the long-term — they’re cheap as compared to even last year.

Because of this, literally, millions of U.S. homeowners are in the money to refinance.

When you’re “in the money” to refinance, it means that you stand to reduce your mortgage rate by 150 basis points (1.5%); you have at least $50,000 remaining on your loan balance; and, your loan has at least 10 more years until it’s paid off.

Plus, there are huge numbers of homeowners whose current rates are more than 50 basis points (0.50%) above than today’s going rate, which can make a refinance opportunities available.

Even better is that banks are more willing to approve refinance applications.

According to data from Ellie Mae, the closing rate for a refinance application topped 60% in July. Last year, closing rates were barely over half.

It’s getting easier to get approved.

Some of today’s popular refinance loans include:

  1. The Home Affordable Refinance Program (HARP) : For homeowners with underwater conventional loans which pre-date June 2009
  2. The 97 LTV loan : For homeowners with conventional loans and 3% home equity or more
  3. The FHA Streamline Refinance : For homeowners with an existing FHA loan who want to lower their mortgage rate and payment
  4. The VA Streamline Refinance : For homeowners with an existing VA loans who want to lower their mortgage rate and payment
  5. The USDA Streamline Refinance : For homeowners with an existing USDA loan who want to lower their mortgage rate and payment
  6. The Conventional Refinance : For homeowners with at least 10% home equity wanting to refinance a conventional loan, or to refinance to cancel FHA MIP

Current Freddie Mac data shows that the median age of a refinanced mortgage was 5.6 years last quarter. The typical refinancing homeowner, therefore, lowered its mortgage rate 250 basis points (2.50%), which yields an annual savings of more than 35 percent.

Don’t be concerned for closing costs too much, either. Long-term, a refinance to low interest rates will save more money than it costs — especially when the refinance is a done as a zero-closing cost refinance.

Homeowners who refinanced last year will save $5 billion combined during the first 12 months of payments. With 2015 mortgage rates down again, this year’s refinancing homeowners will save even more.

It’s an excellent time to explore your refinance options.

What Are Today’s Mortgage Rates?

Mortgage rates are down but may not stay low for long. Consider your options to refinance; and, explore what homeownership might look like at today’s cheap rates.

Take a look at today’s real mortgage rates now. Your social security number is not required to get started, and all quotes come with instant access to your live credit scores.

Click here to get started.

The information contained on The Mortgage Reports website is for informational purposes only and is not an advertisement for products offered by Full Beaker. The views and opinions expressed herein are those of the author and do not reflect the policy or position of Full Beaker, its officers, parent, or affiliates.

Try the Mortgage Calculator

NAR Video Spotlight: Window to the LawCyberscams and the Real Estate Professional

Interested in more details on this topic? Click here!

Editor’s Note: This is part of a monthly video series from the NATIONAL ASSOCIATION OF REALTORS® to inform and educate members about important aspects of being a REALTOR®. Watch for this series each month in RISMedia’s Daily Real Estate Advisor.

The NATIONAL ASSOCIATION OF REALTORS® (NAR) has produced a video entitled Window to the Law: Cyberscams and the Real Estate Professional. This video alerts real estate professionals to common online fraud schemes, and provides tips and information presented by NAR Associate Counsel Jessica Edgerton to help industry professionals and their clients stay protected.

Click here to view the slide presentation from this video.

To watch this video on NAR’s website, visit: http://www.realtor.org/videos/window-to-the-law-cyberscams-and-the-real-estate-professional?cid=RISVID0019.

Interested in more details on this topic? Click here!

Join RISMedia on Twitter and Facebook to connect with us and share your thoughts on this and other topics.

Leave a Reply Cancel reply

Copyright© 2015 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.

Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia’s REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com

National Association of Realtors names Arnold as AOR

The National Association of Realtors (NAR), which represents both the residential and commercial real estate industries, has named Boston-based Arnold as its agency of record after a competitive review involving 18 agencies.

Havas’s Arnold has been primarily tasked with helping NAR revamp the role of the realtor. Since many young people turn to the internet instead of a realtor when it comes to finding a home, Arnold’s goal will be to educate millennials on what exactly a realtor does and why they are valuable for the home buying process.

It will also be responsible for marketing efforts spanning across strategy, creative, digital, and brand activation.

Previously, California agency Most served as agency of record for NAR.

NAR President Chris Polychron said: “Arnold’s understanding of the millennial segment, coupled with their ideas on how to position the value of realtors in a marketplace that is heavily influenced by digital technology, algorithms and electronic matchmaking was impressive.”

Select Resources International managed the review.

Arnold’s clients include Fidelity Investments, The Hershey Company, and New Balance.

Fannie Mae: 3 reasons why this oil glut won’t crash housing

Although oil prices are expected to be lower for longer, the negative effect on home prices is likely to be less severe for most oil-producing states than what happenned in the 1980s, a new Housing Insight report from Fannie Mae said.

Now that oil prices are estimated to stay lower, Fannie decided to figure out how this drop compares to the 1980s oil glut.

The good news is that this time should generally be less severe.

Back in the 1980s, Fannie explained that while most Americans enjoyed lower gas prices at the time, others felt a negative impact as large employment losses occurred in the oil industry followed by a general economic slowdown in many oil-producing states.

Desipte most Americans enjoying lower gas prices, others felt a negative impact as large employment losses occurred in the oil industry followed by a general economic slowdown in many oil-producing states.

This time around, Fannie projected a five-year cumulative “drag” on future house price growth caused by the oil price decline for 10 oil-producing states under the assumption of sustained lower prices.

Fannie examined the historical relationship in the 1980s between oil prices, oil industry employment and house price growth.

If the approximate current oil price futures curve ($60 by 2019), Fannie projected that the negative effect on house prices is likely to be less severe for most oil-producing states than in the 1980s.

Fannie listed three main difference between the 1980s and now, despite what you may read on the topic in the Wall Street Journal:

1. Oil price behavior

Prices fell continuously for eight years in the 1980s and by a greater magnitude than that which has occurred presently to date.

2. State economies are more diversified

Most oil-producing states’ economies rely less heavily on the oil industry today.

3. Technology advancements

Advancements in production technologies have changed how the industry responds to oil prices, potentially reducing the price sensitivity of oil industry activity, but also increasing the level of uncertainty.

However, it is important to note that this isn’t true for three states.

Alaska, North Dakota and Wyoming are at risk of experiencing significant cumulative declines, and, in a worst-case scenario, other states could be, as well.

Fannie Mae and Freddie Mac settlements loom on horizon

The Obama administration may be close to calling a truce with aggrieved shareholders of Fannie Mae and Freddie Mac.

Shares of the mortgage-financing giants jumped on Friday after an influential analyst said he believes the White House may be moving closer to settling multiple lawsuits stemming from the government bailout of Fannie and Freddie in 2008.

Several shareholders, including Fairholme Capital Management and Perry Capital, sued over the government’s 2012 decision to change the terms of the bailout and sweep most of Fannie and Freddie’s profits to the US Treasury rather than collecting a set dividend.

On Friday, Dick Bove, an analyst at Rafferty Capital Markets, suggested a settlement is near because government lawyers recently asked to see heavily redacted documents in the case between the US and preferred shareholders, led by mutual-fund giant Fairholme.

“The unusual request suggests that the White House may be moving closer to a negotiated settlement in the multiple Fannie Mae lawsuits which will benefit shareholders in this company, the largest of whom is the US taxpayer,” Bove wrote in an opinion piece on CNBC.com.

Fannie Mae stock gained 4.1 percent Friday to close at $2.28, while Freddie Mac rose 4.8 percent to close at $2.18.

The timing of the request by the White House has led many Fannie and Freddie watchers to wonder if the feds are worried that they might lose the case.

Government documents in the suit — which were finally turned over to shareholders on Aug. 11 — show officials overstated the shaky health of the two mortgage giants for years, raising questions about the necessity of the net worth sweep of 2012.

HAMP Borrowers Facing Higher Payments May Be Able to Turn to Freddie Mac

loan modification, approvedFor homeowners who received a modification through the government’s Home Affordable Modification Program (HAMP) and are facing higher monthly payments due to a reset, Freddie Mac is offering assistance, according to a post on Freddie Mac’s blog on Thursday.

Borrowers who can’t afford their monthly payments due to the increase or for those who have fallen behind and are at risk of re-defaulting may be eligible to have their loans re-modified under Freddie Mac’s guidelines. Those borrowers should contact their servicers to find out what options are available, according to Freddie Mac.

The Department of Treasury launched HAMP in February 2009 during the worst period of the housing crisis as a way for homeowners facing foreclosure to stay in their homes and lower their monthly mortgage payments. Those borrowers who received HAMP modifications in 2009 and 2010 are now facing higher interest rates after resetting due to the expiration of their five-year modification. Under the terms of HAMP, the interest rates gradually increase at a rate of 1 percentage point per year until it reaches the market rate that was in effect at the time of the modification.

HAMP graph

Mark McArdle, Chief of the Homeownership Preservation Office in the Office of Financial Stability at Treasury, said the median increase for the first step-up after the five-year HAMP mod expires is about $95 per month nationwide, varying sometimes greatly from state to state. The median increase for the second step-up could be as much as $200, he said, although more than 90 percent of HAMP borrowers will still have an interest rate below 5 percent after three step-ups and therefore still have a lower monthly payment than they had before they received the HAMP mod.

According to Treasury’s Making Home Affordable Program Performance Report for Q1 2015, approximately 2.3 million homeowners had started HAMP trial modifications in the six-year existence of the program. About 1.48 million of those homeowners received permanent HAMP modifications, and as of the end of Q1 2015, about 974,000 of those modifications were still active in HAMP.

HAMP began in 2009 and was originally set to expire at the end of 2012 but has been extended twice and is now set to expire at the end of 2016.

Fitch Upgrades Freddie Mac’s Commercial Mortgage Special Servicer Ratings

NEW YORK, Aug 28, 2015 (BUSINESS WIRE) –
Fitch Ratings takes the following actions on the commercial mortgage
servicer ratings of Freddie Mac’s Multifamily Division:

–Commercial mortgage special servicer rating upgraded to ‘CSS2′ from
‘CSS2-’;

–Commercial mortgage master servicer rating affirmed at ‘CMS2′.

The upgrade of the special servicer rating reflects the special
servicing group’s workout experience with multifamily properties
throughout the United States, proactive surveillance, efficient use of
technology for asset management, and effective internal controls. While
only two members of the special servicing team, who average over 30
years of experience, are actively working out defaulted assets, the
group has significant special servicing bench strength and management
depth among its 19 employees who are capable of working out loans should
defaults rise. Special servicing senior managers average 29 years of
experience and 12 years of tenure, while middle managers average 22
years of experience and seven years with the company.

The special servicing group is responsible for defaults within Freddie
Mac’s balance sheet portfolio which consists of 6,373 loans totaling
$70.3 billion as of March 31, 2015, as well as one CMBS transaction. The
group resolved seven defaulted loans for the 12 months ending March 2015
totaling $42.4 million, only one of which incurred a loss. Resolutions
included three full payoffs, three returned to performing, and one
discounted payoff for multifamily assets located in five states and the
outstanding balance of the loans ranged from approximately $280,000 to
$9.1 million.

The affirmation of the master servicer rating reflects Fitch’s
assessment of Freddie Mac’s core servicing competencies, including
primary servicer oversight, surveillance, loan accounting, and investor
reporting. Since becoming a rated master servicer, Freddie Mac has
appointed itself for the FREMF 2014-KX01, and most recently, FREMF
2015-KJ01 transactions. Future master servicing assignments are expected
to support new product initiatives such as small balance and affordable
housing transactions as well as balance sheet transactions of legacy
assets. In addition to the two CMBS transactions, Freddie Mac performs
the core master servicing, in one form or another, for its $55.6 billion
whole loan portfolio, a multifamily investment securities portfolio of
$23.4 billion, as well as its multifamily guarantee portfolio of $94.7
billion as of March 2015.

Both ratings consider the company’s financial strength backstopped by
the U.S. Treasury, knowledge of the multifamily lending environment
combined with the support of its seller/servicer network. Due to the
concentration of servicing for multifamily assets, servicer ratings are
limited to the ’2′ category.

Fitch’s servicer rating methodology is described in Fitch’s reports
‘U.S. Commercial Mortgage Servicer Rating Criteria’, dated Feb. 14, 2014
and ‘Rating Criteria for Structured Finance Servicers’ dated April 23,
2015, which are available on Fitch’s web site www.fitchratings.com.

Additional information is available at ‘www.fitchratings.com‘.

Applicable Criteria

Rating Criteria for Structured Finance Servicers (pub. 23 Apr 2015)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=864375

Rating Criteria for U.S. Commercial Mortgage Servicers (pub. 14 Feb 2014)

https://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=735382

Additional Disclosures

Solicitation Status

https://www.fitchratings.com/gws/en/disclosure/solicitation?pr_id=990111

Endorsement Policy

https://www.fitchratings.com/jsp/creditdesk/PolicyRegulation.faces?context=2detail=31

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND
DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING
THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS.
IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE
AVAILABLE ON THE AGENCY’S PUBLIC WEBSITE ‘WWW.FITCHRATINGS.COM‘.
PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS
SITE AT ALL TIMES. FITCH’S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS
OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES
AND PROCEDURES ARE ALSO AVAILABLE FROM THE ‘CODE OF CONDUCT’ SECTION OF
THIS SITE. FITCH MAY HAVE PROVIDED ANOTHER PERMISSIBLE SERVICE TO THE
RATED ENTITY OR ITS RELATED THIRD PARTIES. DETAILS OF THIS SERVICE FOR
RATINGS FOR WHICH THE LEAD ANALYST IS BASED IN AN EU-REGISTERED ENTITY
CAN BE FOUND ON THE ENTITY SUMMARY PAGE FOR THIS ISSUER ON THE FITCH
WEBSITE.

View source version on businesswire.com: http://www.businesswire.com/news/home/20150828005600/en/

SOURCE: Fitch Ratings

Fitch Ratings
Primary Analyst
Adam Fox
Senior Director
+1-212-908-0869
Fitch
Ratings, Inc.
33 Whitehall Street
New York, NY 10004
or
Secondary
Analyst
James Bauer
Director
+1-212-908-0343
or
Committee
Chairperson
Daniel Chambers
Managing Director
+1-212-908-0782
or
Media
Relations:
Sandro Scenga, New York, +1 212-908-0278
Email: sandro.scenga@fitchratings.com

Copyright Business Wire 2015

Freddie Mac: Mortgage rates drop




Mortgage giant Freddie Mac says the average rate on a 30-year fixed mortgage dropped from 3.93 percent a week ago to 3.84 percent this week.



(NBC) – Mortgage giant Freddie Mac says the average rate on a 30-year fixed mortgage dropped from 3.93 percent a week ago to 3.84 percent this week.

The stock market’s dramatic plunge early in the week sent investors flooding to the safety of the bond market causing prices to rise which dampens rates.

Mortgage rates typically follow the rate on the ten-year bond which dropped below a two-percent yield on Monday, when the panicked selling began.

Wall street’s unsteady week could cause the federal reserve to delay an interest rate hike that was expected some time this year.

If the fed leaves rates alone, mortgage rates will likely remain at historically low levels.

Lower rates makes it cheaper for home buyers to purchase a home.