any Wal-Mart’s in Sub Saharan Africa

The search links back one of my original posts back in November asking “Is Wal-Mart Good for the Economy?“

August 17th – The current mortgage rate predictions article can be found here:  Mortgage Rate Predictions – Mortgage Rates Around 5.2% in Mid August.  Mortgage rates remain historically low and it looks like it is going to stay that way for some time as the Government continues to work very hard to keep interest rates low.  The article goes into great depth about where we have been and where we are likely to go as far as mortgage rates are concerned.

The July 19th mortgage rate predictions article can be found here: Mortgage Rate Predictions – Interest Rates Up Big This Week. There is very bad news on the horizon as the 10 year treasury rate yield continues its strong uptrend. It looks like the long term mortgage rates trend is bottoming and we are likely to see much higher mortgage rates. How much higher? Check out the article to find out!

The July 6th mortgage rate predictions article is available here: Mortgage Rate Predictions – Rates Ready to Make a Strong Move. Average mortgage rates are likely to make a strong move in one direction but do you know which direction that is going to be? Stay tuned to Subprime Blogger to find out!

June 29th – The most up-to-date mortgage rate predictions article has been published here: Mortgage Rate Predictions – Rates Find Support This Week? Also remember that on Subprime Blogger we are going to release daily mortgage rates and how they correlate to the to 10 year treasury rate; please check back in every morning to get a prediction of where rates are headed based on the daily trading moves of the 10 year treasury rate.

June 23rd – I recently updated my newest article on mortgage rate predictions, please check it out and share with friends: Mortgage Rate Predictions – Rates Remain Stable

June 15th -  Mortgage Rate Predictions – Mortgage Rates Stabilize in Late June?

June 12th – My prediction for this week was

30 Year Fixed Rate Mortgage – 5.49%
ACTUAL 30 Year Fixed Rate Mortgage – 5.59%

Yesterday evening I wrote that mortgage rates are going MUCH higher.  The 10 year treasury rate almost hit 4% this week but has seen some heavy selling since then.  This is exactly what I expected but we still need to see where the treasury yield finds support.  This will determine where mortgage rates are going to go from here.  Selling of the yields suggests we will at least see some stabilization but lets see what tomorrow and early next week brings.

June 6th – The 10 Year Treasury Yield continues to rise towards 4%.  By looking at this chart you can see that the 10 year yield has been in a steady uptrend since the end of December of last year.  Many analysts believe that the increase in the yield is a sign of confidence that the economy is getting better.  One thing remains true throughout recent history, as the yield rises so do interest rates.  I am not sure that I am as confident as others that the economy is getting better but I cannot fight the fact that investors somewhere feel that way.  With that being the case, I strongly think rates will rise again next week.

Mortgage Rate Prediction for June 11:

30 Year Fixed Rate Mortgage – 5.49%

The mortgage rate survey from Freddie Mac came in this week, June 3rd, at 5.29% which is up HUGE from last week’s rates of 4.91%.  The housing market is going to greatly struggle if rates continue higher like this.

Mortgage Rate Prediction for June 4:

30 Year Fixed Rate Mortgage – 4.98%
ACTUAL 30 Year Fixed Rate Mortgage – 5.29% (WOW!)

I personally think the uptrending 10 year treasury yield will bring mortgages rates oh so close to 5%.

Last week the Freddie Mac weekly mortgage rates survey reported an overall average of 4.80% vs. my predicted 4.77%.  The 30 year fixed rate dropped slightly in part because the Federal Reserve purchased $50 billion in mortgage backed securities during the prior week.  The objective of the Fed it to put a ceiling on mortgage rates and that ceiling is getting lower and lower each week.  Last week the Federal Reserve reported that they increased their purchase of MBS’s by 50%; this is sure to send mortgage rates even lower.

Current mortgage rates are artificially low because of the actions by the Federal Reserve Bank.  Unfortunately, the government is not letting free markets work themselves out but this is not different than any other part of the business world today.  Now that the Fed is accelerating the amount of money they are dumping into MBS’s it is hard to predict a rise in mortgage rates in the near future.  This week’s mortgage rate predictions:

30 Year Fixed Rate Mortgage – 4.76%

The data produced by Freddie Mac on Thursday should be quite interesting this week as we are likely to hit another “all time low” in terms of survey data.  It is still unknown if this drop in mortgage rates will help the overall housing market, but the government is sure giving it a try.

• Home Loan Modification Will Help Stop Foreclosure
• Mortgage Rate Predictions – Rates Lower to Historic Levels?
• Economic Crisis – Recession with Rising Interest Rates and Rising Inflation

When thinking about a wish list and reality check some of the questions you might as yourself include

1. How far am I will do drive to work?
2. Am I willing to live in a home without a basement or attic?
3. Is having a yard or garden a must?
4. Do I have pets that need extra outdoor space?
5. Do I need a garage?
6. Is a study or home office a necessity?
7. Do I plan on hosting events that would necessitate more rooms?
8. How many children do I have or think I will have?
9. Do I want to be close to the social scene or in the country?

These are just a few of the questions you need to ask yourself when creating a wish list and reality check.  Obviously, there are many more questions that one must ask, but this is a start.  Everyone has their own style and tastes so the questions may be MUCH different for each individual.  If you have a spouse of live-in partner, you should also have them create a wish list and reality check.  Before looking at homes, it is advisable to go over the lists with each other to determine what you each must have.  If you do not do this, you are likely to have an unpleasant home buying experience.

It is extremely important to be as specific as possible.  Try not to write down that you want a nice kitchen.  What kind of countertops do you want?  Do you want stainless steel appliances?  What kind of floors do you want in the kitchen?  What size kitchen do you want?  Should the kitchen have an island?  Are new appliances necessary?  These are the questions you need to ask yourself for each room.  If you are vague in your lists, you are likely to find yourself looking at many more homes than necessary.  It also greatly helps your real estate agent if you are specific in your needs.

For your reality check, it is smart to create a single sentence that sums up your basic needs.  An example would be “I need three bedrooms, two baths, an attached garage, at least a garden or small yard, a park or greenway within walking distance and a 30 minute or less drive to work.”  This will help you to keep yourself on task as you go through the home buying process.  Everyone wants the beautiful house overlooking the lake, but is that really want you NEED at this time in your life.  Realize that you may very well get that house on the lake one day, but what is best for you right now?

For more answers to home buying questions please check out the link below.

• Home Buying

If the problems are unfixable you can withdraw from the contract or renegotiate the purchase price to reflect the long term costs of the unfixable problems.  Some unfixable problems include:

• The house sites on a fault line
• The house is in a floodplain
• The foundation is cracked more than 1/8 of an inch
• The house is located under electromagnetic power lines

If any of these issues arise, you must determine if the house is worth these major issues.  You might get a greatly reducted price, but it is worth it in the long run?  That is the question you must ask yourself.  Click the link below for answers to more home buying questions.

• Home Buying

When you meet with your broker or agent, they need to be listening closely to your desires.  If they are asking probing questions to find out more about your needs, they are likely to find a home that suits you better.  If your broker rarely returns phone calls and is short with you, it might be wise to go to the agent’s managing broker.  It is the managing broker’s job to make sure that the customers of the firm are content and happy with their employees work.

If you are getting nowhere with receiving better service, it is advisable to seek a new agent or new brokerage.  You are not committed to your broker unless you signed an exclusivity agreement.  If you did sign an agreement just wait out the expiration date of the contract; it will be worth it in the long run.

• Home Buying

The good faith estimate is based on the lender’s experience of the local costs involved in completing a mortgage.  The estimate can be a flat dollar amount or a range, but the form must be concise.  It is your right as a borrower to question any estimate on the GSE form.  If you feel these costs are not reasonable, you need to find another lender and start the good faith estimate process with them.

Make sure to realize that closing costs change on a daily basis.  A few days prior to closing, it is advisable to check with your lender to get a new estimate on how much the closing costs will be.  There are lenders that are providing little or no closing costs, but make sure to do your research before choosing one of these lenders.  They need to have a strong balance sheet and a quality reputation before you even consider applying for a mortgage with these no-cost lenders.

• Home Buying
• Can You Buy a Home Without an Agent
• Is It Better to Buy a New Home or an Existing Home?

In a sellers market, when there are many more buyers than homes available, it is likely that the commission will be less than average.  This is because the agent has to do little work to get buyers to actually look at the home.  If there is a higher demand for homes, buyers will find the house by themselves.  The opposite is true in a buyers market.  Oftentimes, the real estate agent will charge a higher commission because he or she has to work much harder to get buyers into the home as there are too many houses on the market.

If it is a sellers market, you are much more likely to see many For Sale By Owner properties.  Sellers do not want to pay commission if their house is going to sell either way.  When the supply of homes is low and the demand is high, many savvy sellers find ways to avoid paying up to 7% in commission.

If you are a buyer or seller, it is very important to find out the commission that the seller broker is going to charge.  The rate being charged will give you a good indication if it is a buyers or sellers market in that particular area. It may also determine which homes your agent shows you.  If the commission is extremely low for your agent, they are less likely to show you that home first.

• Home Buying
• Can You Buy a Home Without an Agent
• Is It Better to Buy a New Home or an Existing Home?

They will be the ones that point out the water stains on the ceiling which could be the first signs of a leak upstairs.  They will be the ones that reiterate that there is always another home on the market when you cannot negiogiate the deal you want.  They will be the ones that will inform you of any new laws and regulations that may lower your mortgage payment.  Unfortunately, you probably do not have the time to do all of this on your own.

There are definitely constraits when it comes to getting an agent.  You will have to work with them to find times to meet and look at houses.  You will have to wait patiently for them to go through all the documentation.  That being said, it is often worth it in the long run because they are much more experienced and can make the home buying process much easier when all is said and done.

Another extremely important bit of knowledge that real estate agents have is the value of a home or area.  You may not realize that your current home is worth much more than it is.  You also may not realize that the home you want is actually 30% higher than all the other homes in that development.  These are things that even the most in-depth research cannot reveal.  First time buyers are encouraged to get a real estate agent for all these reasons.  If you are a do-it-yourselfer, it is definitely possible to buy a home without an agent, but you may be missing out on many aspects of the home buying process.

• Home Buying
• Final Walk-Through Should Be Scheduled AFTER The Seller Has Moved Out
• Is It Better to Buy a New Home or an Existing Home?

While down payments decreased, the debt-to-income ratios for borrowers began to increase.  It was not unheard of, in the early 2000′s, for a mortgage to be signed with a debt-to-income ratio of 45%; meaning that a family is spending 45% of their gross monthly income on their mortgage.

The Veterans Administration has always offered qualified veterans zero down payment loans.  The drawback is that the mortgage loan is very expensive.  Conventional lenders began to offer zero down payment loans to ordinary home buyers in the late 1990′s.  During the housing bubble, there were very few restrictions to these types of loans.  Things have changed greatly as the mortgage crisis has put many lenders under.  It is unlikely that you will be able to find a reputable zero down payment loan in today’s economy.  Most lenders know how risky this can be and are not willing to take that risk.

If you are able to find a zero down payment loan in today’s economy, it is not likely that that financial institution will survive the recession.  Every single responsible lender is forcing borrowers to put money down to reduce the risk of default.  To avoid private mortgage insurance (PMI), you will need a down payment of at least 20 percent.  It is strongly suggested to come up with at least this much in the current economic environment.  Your job as a borrower is to prove to the lender that you are going to pay your mortgage and do so in a timely manner.  There is no better way to do this than to have a great credit score and a down payment of 20% or more.

When buying a home, it is advisable to underbuy rather than overbuy.  If you underbuy, you will not be constrained financially giving you the opportunity to be more flexible.  If you overbuy, you are likely to be greatly restricted in your financial decisions because your mortgage takes up so much of your income.  Especially in today’s housing market, there is no fault in underbuying.

• Home Buying
• Final Walk-Through Should Be Scheduled AFTER The Seller Has Moved Out
• Is It Better to Buy a New Home or an Existing Home?

Please realize that the process of making a counteroffer is a process of psychology.  If the seller makes an offer of $214,000 and you respond with $210,000 the difference isn’t really that much.  Many buyers and sellers get a number in their head and refuse to go above or below that number.  Realize that a couple thousand dollars over a 30 year mortgage loan period is really not that much.  If you have to budge a little bit to get a home you desire, it might be worth it.

Once you have decided on home much you will counter with, make sure to talk to your broker and get their opinion.  They may prove the point that offering $2,000 less may not be worth it after all the incentives and fees are reduced by the seller.  You usually will not have to complete an entirely new contract, but rules are different throughout the country.  Once again, make sure to consult your broker on this issue.

A good practice for any home buyer is to make an offer with strict guidelines.  Make the offer with the statement, “this offer expires within 48 hours” or “this offer is valid until Friday, March 6th.”  This gives the seller a deadline and lets you know if they are really interested in selling you the house.  In the current economy, it is likely that anyone interested in buying a home will get an immediate response, but there are still those who are not punctual.  These types are sellers are not the ones you will want to work with when negotiating a deal.

• Home Buying
• Final Walk-Through Should Be Scheduled AFTER The Seller Has Moved Out
• Is It Better to Buy a New Home or an Existing Home?