July 11, 2008 - Freddie Mac reports a slight jump in the 30-year fixed mortgage rate to 6.37 percent during the week ended July 10, from 6.35 percent the prior week. The five-year adjustable mortgage rate also moved up, climbing to 5.82 percent from 5.78 percent.

However, the 15-year fixed rate fell to 5.91 percent from 5.92 percent; and the one-year ARM was unchanged at 5.17 percent.

The increase can be attributed to concerns about inflation, with investors and analysts interpreting recent comments by Federal Reserve Chairman Ben Bernanke to mean an end to interest-rate cuts as the central bank moves to prevent out-of-control inflation.

May 27th, 2008 - Mortgage applications fell 4.6 percent last week on a seasonally adjusted basis to 593.3 from 621.6 the previous week, the Mortgage Bankers Association says. On an unadjusted basis, the index also declined 4.6 percent compared with the previous week and was down 7.5 percent compared with the same week last year.

The decline was driven by an 8.9 percent decline in refinance applications, whose share decreased to 46.1 percent from 48.2 percent the previous week. Purchases actually increased 9.1 percent.

Mortgage rates were up marginally:
30-year fixed-rate mortgages increased to 5.96 percent from 5.90 percent;
15-year fixed-rate mortgages increased to 5.49 percent from 5.42 percent;
1-year ARMs increased to 6.92 percent from 6.71 percent.

May 2, 2008 - Long-term mortgage interest rates declined Thursday, and the benchmark 10-year Treasury bond yield increased to 3.76 percent. The 30-year fixed-rate average sank to 5.72 percent, and the 15-year fixed rate dipped to 5.29 percent. Meanwhile, the 1-year adjustable rate fell to 5.9 percent. Mortgage rate figures are according to Bankrate.com, which publishes nightly averages based on its survey of 4,000 banks in 50 states. Points on these mortgages range from zero to 3.5.

April 30th 2008 - The Federal Reserve has cut a key interest rate by a quarter-point, a smaller move than the aggressive easing it undertook earlier this year. The Fed action, announced Wednesday after a two-day regular meeting, pushed the federal funds rate down to 2 percent, its lowest level since late 2004. It marked the seventh consecutive rate cut by the central bank since it began easing credit conditions last September to combat the growing threat of a recession brought on by a deep housing slump and credit crisis.

The rate cut will mean lower borrowing costs throughout the economy as banks reduce their prime lending rate, the benchmark for millions of consumer and business loans. The Fed move was in line with expectations. Wall Street believes this could well wrap up the Fed's rate cuts unless the economy threatens to fall into a worse slump than currently expected. The Fed said it stood ready to "act as needed to promote sustainable economic growth and stability." That phrase was seen as a signal that the Fed is as worried about weak growth as it is about the risk of higher inflation. The Fed devoted portions of its statement to both the threats of weakness and the threats that inflation could pose, likely reflecting the debate inside the central bank.

Many economists believe the country has fallen into a recession. However, the government reported Wednesday that the overall economy, as measured by the gross domestic product, managed to eke out a 0.6 percent growth rate in the January-March quarter.

April 25 2008 - Long-term mortgage interest rates were up again Thursday, and the benchmark 10-year Treasury bond yield increased to 3.83 percent.

The 30-year fixed-rate average edged up to 5.86 percent, and the 15-year fixed rate gained to 5.45 percent. Meanwhile, the 1-year adjustable rate rose to 5.8 percent. The 30-year Treasury bond yield climbed to 4.55 percent.

Mortgage rate figures are according to Bankrate.com, which publishes nightly averages based on its survey of 4,000 banks in 50 states. Points on these mortgages range from zero to 3.5. Mortgages and Home Loans

On an unadjusted basis, the index decreased 24.2 percent compared with the previous week and was down 20.3 compared with the same week last year. Most of the decline was in applications to refinance with the refinance index decreasing 25.7 percent. The purchase index decreased 5.4 percent.

Mortgage rates continued their upward path.

* 30-year fixed-rate mortgages increased to 6.17 percent from 5.96 percent;
* 15-year fixed-rate mortgages increased to 5.7 percent from 5.49 percent;
* 1-year ARMs decreased to 6.8 percent from 6.92.

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Mortgage rate figures are according to Bankrate.com, which publishes nightly averages based on its survey of 4,000 banks in 50 states. Points on these mortgages range from zero to 3.5.

The average rate on 30-year fixed loans dipped from 5.87 percent to 5.85 percent, while the 15-year average rose from 5.27 percent to 5.34 percent. By contrast, a year ago the 30-year averaged 6.16 percent and the 15-year averaged 5.86 percent. To qualify for these rates, borrowers must pay points, or fees that lenders charge for loan processing expressed as a percent of the loan, which this week averaged 0.4 on the 30- and 15-year loans.

Average rates on adjustable-rate mortgages (ARMs) climbed in the latest survey, with five-year Treasury-indexed hybrid ARMs gaining from 5.56 percent to 5.67 percent and the one-year Treasury-indexed ARMs increasing from 5.15 percent to 5.24 percent. Points paid on these loans averaged 0.6 and 0.5, respectively.

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The 30-year Treasury bond yield decreased to 4.56 percent. Rates and bonds are current as of 7:15 p.m. Eastern Standard Time. Mortgage rate figures are according to Bankrate.com, which publishes nightly averages based on its survey of 4,000 banks in 50 states. Points on these mortgages range from zero to 3.5.

Nationwide, the rate of loans entering the foreclosure process hit a never-before-seen 0.83 percent during the fourth quarter, up from 0.54 percent a year ago and 0.78 percent in the third quarter. That pushed the total percentage of loans in the foreclosure process, which stood at 1.19 percent at the end of 2006, to 2.04 percent in the fourth quarter 2007 also a new record.

The delinquency rate rose to 5.82 percent during the fourth quarter -- the highest the MBA has seen in its quarterly survey of lenders since 1985. The delinquency rate stood at 4.95 percent during the same quarter a year ago, and at 5.59 percent in the previous quarter.

"Our general outlook is as long as house prices are declining, we expect to see some continued increase in delinquencies and foreclosures," Duncan said. With the continued seizure of credit markets and tightened underwriting standards, "we don't expect to see the peak (in foreclosures) until mid- to late-2008."

If there's any good news in the latest numbers, it's that there's been little growth in the rate of foreclosure starts in Midwestern rust-belt states such as Michigan, Ohio and Indiana, where different factors are in play. Job losses and outmigration, rather than overbuilding, have contributed to the decline in demand in those states, Duncan said.
reclosure starts.

Since the fourth quarter of 2006, the foreclosure start rate for prime ARMs increased from 0.41 percent to 1.06 percent, while the rate for subprime ARMs increased from 2.7 percent to 5.29 percent.

Subprime ARMs represented just 7 percent of loans outstanding, but accounted for 42 percent of foreclosures starts during the fourth quarter. Prime ARMs represented 15 percent of outstanding loans, and 20 percent of the foreclosures started.

While millions of ARM borrowers still face interest-rate resets, Duncan said the impact of those payment adjustments will be less than feared because cuts in short-term interest rates made by the Federal Reserve have also brought down the six-month LIBOR rate, the index used for many subprime ARM loans, by 2.5 percent since last September.

Problems in the subprime mortgage market are rapidly spilling over into other areas of the economy. No matter what the experts call it — a recession, slowdown or even the makings of a depression — it's clear banks are under mounting pressure to be more cautious about lending.

"If consumption growth stagnates, the odds of a recession are incredibly high," said Andrew Bernard, director of the Center for International Business at the Tuck School of Business at Dartmouth. "All the pieces of household financial health are starting to be shakier, especially at the low end."

He and others are paying close attention to what top U.S. banks say about their customers' payment habits. Many view this as an early indicator about where the overall economy is headed, but there are other signs that are troublesome.

The stock market has had its worst start to the year in three decades, with investors rattled by signs from the Labor Department that unemployment is on the rise and retail sales are on the decline. Further, the Commerce Department reported Wednesday that higher costs for energy and food in 2007 pushed inflation for the year up by the largest amount in 17 years.

There was no sign of a turnaround in the last few months of the year. The Federal Reserve reported that the economy grew at a slower pace in late November and December as credit problems intensified and consumers tightened their spending.

To some, it appears that the Fed came to its rate-cutting decision in August a bit too late. Others point to the falling dollar and surging oil prices, factors that usually prevent the central bank from easing its monetary policy.

While debate persists about the Fed's timing and the extent of the slowdown, bank executives — who have scrambled to prepare for another tumble in home prices and higher unemployment in 2008, feel academic definitions are beside the point.

"We're not predicting a recession — it's not our job — but we're prepared," JPMorgan Chase CEO Jamie Dimon told analysts after the nation's third-largest bank wrote down $1.3 billion and said profit dropped 34 percent.

His financial institution didn't do all that bad. Rival Citigroup Inc. fared the worst during the fourth quarter, losing $9.83 billion after writing down the value of its portfolio of mortgage and mortgage-backed products by $18.1 billion.

Wells Fargo, a more traditional bank that avoided last year's trading woes, saw its profit fall 38 percent due to troubles with home equity loan and mortgage defaults.

JPMorgan is girding for home prices to decline further in 2008 by 5 percent to 10 percent; Citigroup's estimate of 7 percent falls within that range, too.

"The banks are the infrastructure for everything, the heartbeat of the market," said Chris Johnson, president of Johnson Research Group. "They need to be fixed before the market, and economy, can move forward with confidence. They need to get all their dirty laundry out there."

Banks and card companies like American Express Co. — which warned last week that it would add $440 million to loan loss provisions — said in the regions where home prices are declining, card default rates are rising faster. The same goes for auto loans, subprime mortgages and home equity loans in these areas, which include Florida, Michigan and California.

A big reason for the rise in credit card default rates is that they are returning to more usual levels following a change in bankruptcy law that sent rates lower for a time. But the fact that more losses are being seen in the weaker parts of the country shows the increase is economically driven as well.

Analysts believe this means one thing: Consumers will be the ones paying for years of lax lending standards by U.S. financial institutions. Many will become more restrictive about who gets credit in a bid to stem future losses — and that could curb consumer spending, which accounts for more than two-thirds of the economy.

"We've pushed the envelope," Johnson said. "Along with the joy of a market that goes as high as ours is the agony of when it starts to correct itself."

The reduction in the target for the federal funds rate, to 4.75 percent, marked the first time the Fed had cut the overnight rate since June 25, 2003. At the time, the Fed was capping a series of reductions intended to encourage borrowing and stave off a recession after the dot-com stock market bust and the Sept. 11, 2001, terrorist attacks.

Some analysts said the drastic reductions in the federal funds rate helped fuel the housing boom by easing lending standards. The Fed then tried to put the brakes on growth by raising the federal funds rate 17 straight times between June 30, 2004, and June 29, 2006.

Just as the Fed was criticized for slashing the federal funds rate so drastically after the dot-com bust, some said it went too far in tightening monetary policy in an effort to keep inflation in check.

In a statement explaining today's decision, the Fed's Open Market Committee said economic growth was moderate during the first half of the year, but that "tightening of credit conditions has the potential to intensify the housing correction and to restrain economic growth more generally."

Lowering the federal funds rate "is intended to help forestall some of the adverse effects on the broader economy that might otherwise arise from the disruptions in financial markets and to promote moderate growth over time."

The Federal Reserve's Board of Governors also unanimously approved a 50-basis-point reduction in the discount rate, to 5.25 percent.

The Fed slashed the discount rate from 6.25 percent to 5.75 percent on Aug. 17, in part because mortgage lenders have been having trouble obtaining short-term funding.

The Fed acted after Countrywide Financial Corp. announced it had drawn down an $11.5 billion line of credit with 40 banks, and a Merrill Lynch & Co. analyst warned that the company could face bankruptcy if it was forced to sell of assets at bargain-basement prices.

The Fed said it would accept mortgage loans as collateral at the "discount window," and extended the terms of what are ordinarily overnight loans to up to 30 days.

Además de asegurar el continente o la estructura de la vivienda, es conveniente cubrir otras posibles contingencias. Para ello existen los siguientes tipos de seguros:
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Lenders are also backing away from low-documentation and stated-income mortgages. Many lenders now require buyers to have a cash down payment, good credit and the ability to verify income.

Freddie Mac reported a drop in the 30-year fixed rate to 6.45 percent from 6.52 percent a week earlier, while interest on 15-year fixed loans slipped to 6.12 percent from 6.18 percent. Adjustable-rate mortgages, however, moved in the opposite direction.

The five-year ARM settled at 6.35 percent for the week, up a notch from 6.34 percent a week ago; and interest on one-year ARMs averaged 5.84 percent compared to 5.6 percent.

During the second quarter of this year, foreclosures were nearly 10 percent of all resales, compared with just 1.7 percent a year earlier. But that's still off the peak of nearly 15 percent seen twice during the mid-1990s, according to DataQuick Information Services, which has been tracking real estate transactions since 1988. DataQuick's analysis of recent sales found no pattern of foreclosure properties regularly selling for less than comparable homes.