Friday’s Mortgage Rates
Rhonda Porter on 03 30, 2007
Mortgage rates are slightly up with the PCE Report showing an increase in inflation by 0.3% over February (mortgage bonds react negatively to inflation). The following rates are as of 8:30 a.m. on March 30, 2007 (pst).
The rates below are based on a 680 credit score with 20% down payment, full documentation and are priced with 1 point. For more details on how I priced the following rates, please read my original Friday Rate post.
Conforming Mortgage Rates (loan amounts up to $417,000 for 1-unit properties)
30 Year Fixed: 5.875% (APR 6.013%). Payment per $1000 = $5.92
30 Year Fixed with 10 Year Interest Only: 6.125% (APR 6.265%). Payment per $1000 = $5.10
7/1 ARM: 5.625% (APR 5.761%). Payment per $1000 = $5.76
5/1 ARM: 5.500% (APR 5.635%). Payment per $1000 = $5.68
5/1 ARM with 10 Year Interest Only: 5.500% (APR 5.635%). Payment per $1000 = $4.58
JUMBO (Non-Conforming) Rates
30 Year Fixed: 6.125% (APR 6.275%). Payment per $1000 = $6.08
30 Year Fixed with interest only payments: 6.125% (APR 6.275%). Payment per $1000 = $5.10
5/1 ARM: 5.875% (APR 6.022%). Payment per $1000 = $5.92
5/1 ARM with 10 Year interest only: 5.875% (APR 6.022%). Payment per $1000 = $4.90
Mortgage rates are still very strong but please do not select your Loan Originator by the interest rate alone. And, most importantly, have a HAPPY FRIDAY! 
About the Author: Rhonda Porter
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Rhonda-
Couple questions.
1) Just did a transaction with sub 600 FICO’s, NOO, 2nd home property (vacation) with a 6 % 30 yr fixed. This sounded amazing to me. What do you think? I know lenders are stumbling over each other to do deals but 6% on a vacation home?
2) Know of where I can find a resource that can verify if private party financing for a refinance is subject to rescission periods? My understanding is that rescissions apply only to federally insured/backed loans.
Hi Tim,
If the property is a vacation home (true second home–approx. 50 miles from residence and “makes sense”) then it should have the same rate as an owner occupied. If it’s a rental (NOO), then the rate will vary quite a bit depending on LTV.
Regarding the private party financing, I’m not certain. I know the rescission applies to owner occupied homes (not NOO or vacation).
http://www.ftc.gov/bcp/conline/pubs/alerts/3dayalrt.htm
http://www.access.gpo.gov/nara/cfr/waisidx_04/12cfr226_04.html
http://a257.g.akamaitech.net/7/257/2422/12feb20041500/edocket.access.gpo.gov/cfr_2004/janqtr/12cfr226.1.htm
Copy and paste from the last link:
(c) Coverage. (1) In general, this regulation applies to each
individual or business that offers or extends credit when four
conditions are met: (i) The credit is offered or extended to consumers;
(ii) the offering or extension of credit is done regularly;\1\ (iii) the
credit is subject to a finance charge or is payable by a written
agreement in more than 4 installments; and (iv) the credit is primarily for personal, family, or household purposes.
Tim, you will also need to check state law.
http://apps.leg.wa.gov/RCW/default.aspx?cite=19.86
http://apps.leg.wa.gov/RCW/default.aspx?cite=61.34.020
http://apps.leg.wa.gov/RCW/default.aspx?cite=19.146.020
Note from this last link, exemption 1d:
(d) Any person making or acquiring a residential mortgage loan solely with his or her own funds for his or her own investment without intending to resell the residential mortgage loans;
As always, consult your favorite real estate attorney for a legal answer.
These Q&As give rise to the need for a post on seller financing AND a separate post on private investor financing. This could be written from the perspective of escrow or from an attorney’s perspective, or both. Reader analysis: a homebuyer, a refinancing homeowner, and those in the industry who must work with private financiers.
Subprime products will not go away completely, they’ll just transform into new lending sources. We are, after all living and working in a capitalist system. When there is a challenge, new markets see the challenge as an opportunity.
Then, of course, we’ll need to see if all the old laws work with the new “opportunities.” Ah, mortgage lending…always transforming.
Re: “If the property is a vacation home (true second home–approx. 50 miles from residence”
Who determines this ? I see so many differences. Hawaii can be a 2nd home market, Florida. i had a client who lives in California and claims a 2nd home in Maryland ( he works in Maryland in the summer. 2nd home is also defined as a resdience where you will be at least 60 days of the year.
It needs to make sense to the underwriter. The guidelines that we work with at my company do not require 60 days of the year for a vacation property or second home. The examples you’re providing with homes in different states would meet the criteria of being a reasonable distance away from each other to be considered a second home.