Freddie Mac release mortgage rate survey results showing average 30 year fixed mortgage rates for the week ending July 31, 2008 down from to the previous week 0.11% from 6.63% to 6.52%.
Freddie Mac Chief Economist, Frank Nothaft, said,
In my real mortgage rates podcast, I give you the 30 year mortgage rate every day. But how do you know that my 30 year mortgage rate is the par rate since we always say you cannot trust rate quotes?
Mortgage originators tell you your mortgage lock is in force when it is NOT. Lying about your mortgage lock status is a common practice to increase loan revenue or cover loan officer mistakes.
Loan officers are always trying to make the most yield spread revenue on every mortgage. Telling you the mortgage lock is placed but then not actually locking the rate with the wholesale mortgage company allows them to “play the market” with your money.
The Fed makes a rate cut and current mortgage interest rates rise. The current mortgage interest rate on 30 year fixed loan routinely inches up compared to rates before the cut.
Consumers are expecting the opposite to happen and yet it rarely does. This opposite market reaction is pretty consistently over the last few cuts.
The Fed rate cut this week came from and emergency meeting when the Dow futures were down almost 500 points. The rate cut came just in the nick of time stemming a stock market crash…or so we’re told.
Yes…at least that was how it was reported in the media… a crash as bad as Black Monday two decades ago…and we were 60 minutes away. Tick- Tock…
A Good Faith Estimate is a legally required mortgage document showing costs, rate, and payment. Believing the Good Faith Estimate reflects truthful, accurate, and guaranteed figures is folly.
Nothing could be further from the truth.
The Good Faith Estimate is manipulated by the loan officer low balling the costs and rate morphing it from a mortgage disclosure into a selling tool. It does not reflect real mortgage rates or actual closing costs.
What is APR?, is commonly asked question and a confusing concept for the average consumer since most erroneously believe they can use APR to compare mortgage offers.
The confusion is compounded when it is widely reported the government passed The Truth In Lending Act in 1974 which mandated a disclosure of APR on all financing for the express purpose of making financing offers comparable.
What documents should you sign to execute a mortgage rate lock? Always get a rate lock agreement from your broker or banker at the time of lock. Of course, like anything in the real estate or mortgage world, if it’s not in writing it doesn’t exist.
Mortgage rate sheets are a godsend when it comes to keeping loan officers honest. The mortgage rate sheets tell the tale when you are quoted an inflated rate.
All the online rate advertising websites claim to have the best mortgage rates. It is easy to claim you have the best mortgage rates when you have no oversight.
There is more than one lawsuit claiming the rates Bankrate.com, for example, post are manipulated by the companies that advertise on their site. A recent $46,000,000 verdict was pinned on NovaStar for allegedly making false mortgage rate postings on Bankrate.com. They plan to appeal.
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