Quicken Loans Mortgage News

Tiger Woods Goes Jumbo – Super Jumbo Actually

Jordan Fylonenko — Fri, 03 Sep 2010 20:23:59 +0000

Tiger Woods has spared no expense making the most of life since his divorce.

Fresh from his split with former Swedish model Elin Nordegren, the star golfer signed on to a $54 million mortgage for his in-progress mansion on Jupiter Island, Florida. When finished, Tiger’s beautiful bachelor pad is predicted to be worth somewhere around $100 million.

I’ll be honest, I work at a mortgage company and I had no idea that such a large loan even existed! Better yet, they’re called Super-Jumbo loans.

What is a Super-Jumbo Loan?

When loans rise above the million-dollar mark, they are called Super-Jumbo loans. A standard Jumbo loan is any mortgage beyond the conforming loan limit of $417,000.

Interest rates on jumbo loans generally run about one-half percentage point higher than conforming loan rates. By contrast, rates on Super-Jumbo loans can run as much as two full percentage points higher than conforming loans to compensate the lender for the extra risk they’re taking by offering that much cash. Also, Super-Jumbo loans like Tiger’s only allow 40% or 50% of the home’s value whereas a standard loan would usually allow 90% to 100% of the total value.

Is this massive mortgage due to financial straits for the pro golfer? Not so. With borrowing becoming super cheap due to the downed economy, the Super-Jumbo loan seems to be an astute business move to finance the home and its completion.

What is Cheap Mortgage Money?

There’s no such thing as “cheap money,” but Tiger realized that interest rates are at historic lows. And you should, too. Really, rates haven’t been this low since Eisenhower was President in the 50’s! Whether you have a San Francisco home mortgage or San Jose home mortgage, refinancing your home could potentially save hundreds with a lower mortgage payment. And you don’t even need a Super-Jumbo loan!

Market Update – Concerns of Stalling Economy Ease

Jordan Fylonenko — Fri, 03 Sep 2010 14:30:30 +0000

Bonds took a nose dive after the non-farm payroll number came in better than expected. The prior month’s number was also revised to show that companies added more jobs than originally reported. This is easing concern that the economic recovery is stalling. The unemployment rate stayed flat month over month at 9.6%.

Buying a Home Before You Sell Your Home

Amber Hunt — Fri, 03 Sep 2010 11:00:26 +0000

It’s tempting to bargain hunt for a home in today’s buyers market. The times when a seller would get an offer before their “for sale” sign was pounded into the front yard is, for the moment, a thing of the past. This leaves many homeowners to decide whether to grab their dream home at a bargain price before or after they sell their current home.

A bridge loan used to be the first through to cross most people’s minds when they considered two mortgages. In today’s market many homeowners do not have as much equity in their homes so a bridge loan may no longer be a viable option. Homeowners without equity do have a couple alternatives:

VA Loans – Veterans & active members of the military have a great, no down payment loan option available to them. If you’re a former or current military service member and have found the perfect home at the perfect price, consider putting zero down for it and taking out a VA loan for the full purchase price. Once your old home sells, apply any proceeds to the principal of the new loan.
Rent your old home – Rather than carrying the full burden of two mortgage payments, treat your current home as an investment property by renting it. Becoming a landlord comes with new responsibilities, however it also features many benefits. You’ll be able to keep your property as it appreciates, the tax-breaks you receive could offset your income tax on your rent and your rent income can help cover mortgage, taxes and insurance payments.

The bottom line: it’s usually better to sell first in softer market conditions. Once you’ve closed the sale, you should still have plenty of good deals to choose from. If you decide that you can’t wait to buy a new house because you want to take advantage of today’s record low mortgage rates – it’s good to know that there are options out there for you.

Like most home questions, each situation is unique and should be evaluated on a case-by-case basis. Your Home Loan Expert can help you determine which options are best for your situation.

Market Update – Positive Manufacturing Report Sends Equities Higher

Jordan Fylonenko — Thu, 02 Sep 2010 14:26:03 +0000

The economy received some good news from the manufacturing sector on Wednesday sending equities higher and treasury and mortgage prices lower. Mortgage bonds are lower this morning after yesterday’s sell-off and subsequent reprice. Today’s July pending home sales report showed an unexpected gain in the month-over-month number. However, year-over-year home sales are down -20.1%. Finally, the July factory orders report came in as expected, showing a very small increase.

Mortgage Rates Haven’t Been This Low Since…

Amber Hunt — Thu, 02 Sep 2010 11:00:24 +0000

There’s no doubt about it – we are living in one of the best times in history to buy a home or refinance your mortgage. Mortgage rates have hit their lowest levels since 1955. 1955!! That’s over 50 years ago and long before many first time home buyers were even born. These amazing rates really make you wonder why people are still asking themselves: Should I refinance my mortgage? In order to give those who are still wondering some perspective on what a historic time we are living in, we put together a little list:

The Last Time Mortgage Rates Were This Low:

The very first McDonalds restaurant opened
It cost 3 cents to mail a letter
Dwight Eisenhower was President and Richard Nixon was Vice President
Gasoline cost 23 cents a gallon
A new car would cost you around $1,095
Rosa Parks refused to sit at the back of the bus, becoming the Mother of the Modern Day Civil Rights Movement
Pink clothes for men became a fashion rage

No one is sure how long low mortgage rates are going to last, but there’s no denying that the time to get started on that home refinance you’ve been wondering about is right now! Don’t miss your chance to lock in the lowest mortgage rates we’ve seen since haircuts cost 50 cents.

Stock Market Rallies – Could This Be the End of Low Mortgage Rates?

R. Rebecca Carter — Wed, 01 Sep 2010 20:52:33 +0000

A better-than-expected manufacturing report from the Institute for Supply Management (ISM) led to a surge in the stock market today, marking a welcome change from dismal stock performances in August.

Could this surge be heralding a rebound for our ailing economy? With so much recent talk of a sluggish economic recovery, today’s market moves give a much-needed glimmer of optimism.

Since rates tend to drop in a weak economy and rise in stronger economic environments, a trend toward recovery could mean an abrupt end to the low mortgage rate environment we’ve enjoyed in recent weeks.

If you’ve been waiting to refinance or purchase, the wide open window of record-low rates could be closing. We’ll be watching the market indicators closely to see if these trends continue. Of particular interest will be job reports later this week.

Market Update – Consumer Confidence Report Exceeds Expectations

Jordan Fylonenko — Wed, 01 Sep 2010 14:06:09 +0000

Economic signals were mixed yesterday with the June S&P/Case Shiller indices and August U.S. consumer confidence both exceeded predictions while the August Chicago purchasing managers index was below expectations. Mortgages and Treasuries are relatively flat as investors position themselves for Friday’s employment report.

Watch-It Wednesday: 30-Year Fixed-Rate Mortgage

Amber Hunt — Wed, 01 Sep 2010 11:00:05 +0000

Welcome to our new weekly feature – Watch-It Wednesday! Each Wednesday we will bring you videos featuring: frequently asked questions, mortgage facts, the latest mortgage news and much more. We hope that these videos will help keep you informed about the latest happenings in the mortgage industry and also assist you when you’re ready to complete your next home purchase or mortgage refinance.

This week, Home Loan Expert Doug Peeples talks about the 30-Year Fixed-Rate Mortgage:

Do you have a question for our Home Loan Experts? Send us your questions at content@quickenloans.com and we could feature it on the next Watch-It Wednesday!

Market Update – Releases Give Bleak Picture of Economy

Jordan Fylonenko — Tue, 31 Aug 2010 14:33:17 +0000

Treasury and mortgage prices are higher this morning extending yesterday’s rally. Investors are preparing for the week’s data which has portrayed a bleak picture of the economy, stirring fears of a double-dip.

FHA Loan Changes and What They Mean For You

Amber Hunt — Tue, 31 Aug 2010 11:00:25 +0000

The Federal Housing Administration is going to be making some changes to the FHA loan. These changes will go into effect on October 4, 2010. The two aspects of the FHA loan that are changing are the Up Front Mortgage Insurance Premium (UFMIP) and the Mortgage Insurance Premium (MIP) that is charged to borrowers on a monthly basis.

The UFMIP is actually going to be reduced from 2.25% to 1%. This fee is taken and put into an escrow account at the US Treasury and is distributed to HUD on a monthly basis in case the borrower defaults on their loan.

The MIP is going to be raised from .55% of the loan amount per year to .85% of the loan amount per year.

So what does this mean for you? Well, every situation is unique so it’s important to speak with a Home Loan Expert in order to make sure you’re getting the most accurate information for your situation. Your down payment and loan-to-value ratio will determine what your MIP payment will be. However, for a $200,000 loan, borrowers can expect to pay roughly $60 more per month after the new changes go into effect.

With mortgage rates currently at historic lows, and additional changes and fees on the horizon the time to complete that home refinance you’ve been thinking about or make your home purchase is now. Don’t pay an extra penny more than you have to in today’s market. Contact your Home Loan Expert today.