For the 1st time in over a year, both Fannie Mae’s and Freddie Mac’s forecast are the same! Both predict that:
- Purchase activity will be similar to 2nd half of 2011 – Stable is good
- Property values are expected to hold steady for the year – No Declines!
- Rates will remain at very low levels for 1st half of 2012
- Refinances will consume 85%-90% of Mortgage applications through June
What this means to the Realtor Community:
- Put yourself first, if you have not refinanced – now is the time!
- Lenders will be consumed by administering all the HARP program changes
- Loan Originators will be fired up to write refinance loans
- Only 20% of Purchase leads have a chance to materialize into a closing due to limited inventory
- 40% of Refinance Leads turn into done deals
We also came across some local Realtor production numbers for 2011. Out of 2000 local area agents, we found:
- Average sale volume – $3.6 Million – 30 Transactions
- Median (middle) sale volume – $2.5 Million – 20 Transactions
Our Question to you – Do you believe 2012 will be better or equal to 2011?
PLEASE Comment below and share your thoughts as we love to hear from our business partners and learn valuable insight into our market.
Posts tagged FREDDIE MAC
Fannie/Freddie Industry Forecasts
Big Banks VS Mortgage Brokers
We have got a lot of calls recently from customers trying to get a lower rate through the banks they pay their mortgage to, and frustration is setting in. We find that most people call their current lender first because they do not know who else to call. Then they get the idea that they deserve special treatment as a result of their established payment history, thus making the process quick and painless.
Their current lender also piles it on, implying that because they have their current mortgage, the entire process will be easy. They claim there is limited documentation and the appraisal will not be required.
But this simply is not the case. Maybe this was true back when the Big Banks kept the mortgages on their books, but now everyone sells them to Fannie Mae or Freddie Mac so we all play by the same rules.
The striking part is the gap between our rates and the big banks has never been greater. Simply put, the banks are charging higher rates simply because they can.
Eventually, there is some point in the process that expectations set by their current lender to not get met and the troubles begin.
Most people are calling us because past clients have done a wonderful job in referring and we greatly appreciate that. You will continue to hear these stories from friends and family because the rates are so low. So call us to get the truth quickly as it could take forever with your current mortgage company. We are here to help!
HARP 2.0 Guidelines Released
The 2011 HARP guidelines have been released! Here are the key points:
- Current LTV(loan-to-value) cap of 125% lifted
- Appraised value will not matter!
- The current price adjustments based on equity (or lack thereof) will be reduced or even eliminated
- Really helpful for those far underwater or with a 2nd Mortgage
- Loan amount less than 125% LTV – Refinance after 12/1/11
- Loan amount greater than 125% LTV – Still waiting on guidance from lenders
- Program at full capacity by March 2012
If you closed on your current mortgage before 5/31/09, you must look into refinancing. All excuses are officially off the table, and if your loan is backed by Fannie Mae or Freddie Mac, YOU CAN REFINANCE!
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