Cincinnati Mortgage Market update

RE/MAX Elite and the Clermont financial group. If you absolutely, positively want to postion yourself to be successful in today's market!


Mortgage Market Update:

Fixed mortgage rates rose a tenth of a percent during the final week of December, according to a survey of national lenders. While the national average for a 30 year fixed rate mortgage hovered around 6 and a quarter percent, fluctuations have been modest through most of 2007. As economists monitor inflation and its effects on long term US Treasury yields, Fannie Mae and Freddie Mac are both proposing new fees for mortgages they guarantee. Accordinging to these companies, these fees are in direct response to the inherent risks associated with guaranteeing loans.
The National Association of Realtors reported a slight upturn in the number of existing home sales in November with an anticipated 5 million units sold for 2007, even though overall volume is down approximately 20% from this time a year ago. Overall, higher housing inventories and lower interest rates create a lot of opportunity for buyers during the first quarter of 2008!
Finance Q and A:
Q: What is PMI and how does it affect my mortgage?
A: PMI stands for Private Mortgage Insurance, and mortgage underwriters require it when a buyer's downpayment is less than 20% of the home's purchase price. PMI charges can vary depending on the down payment and the price of the home, but the premium typically amounts to half of a percent of the loan amount.
Some buyers try to avoid PMI altogether. One alternative to PMI is to arrange a higher interest rate with the lender, though this is less common now that PMI is tax deductable. Another alternative to PMI is to take out a second loan simultaneously with the first. These loans are called piggyback mortgages, and are attractive in certain circumstances. For more information on PMI, consult your mortgage professional today!

Tip of the Month:

If you are carrying an adjustable rate mortgage and are due for a rate adjustment in the next year, find out what would happen to your payments if your interest rate changed today. Give yourself time to set aside extra money for those increased payments, or consult with your mortgage professional about a possible refinance. It's smart to plan ahead.