Mortgage rates pushed further into the 7% range as the Federal Reserve seems unlikely to reverse its restrictive policy stance anytime soon, according to Freddie Mac.

The average 30-year fixed-rate mortgage was 7.22% for the week ending May 2, according to Freddie Mac’s latest Primary Mortgage Market Survey. That’s an increase from the previous week when it averaged 7.17%. A year ago, the 30-year fixed-rate mortgage averaged 6.39%. 

The average rate for a 15-year mortgage was 6.47%, up from 6.44% last week and up from  5.76% last year.

On Wednesday, the Fed announced it would maintain the federal funds rate at 5.25% to 5.5%, where rates have held steady since last July. Fed officials have said in past meetings that they anticipated rate cuts for 2024 but need more confidence that inflation is heading toward the 2% target rate. Fed Chair Jerome Powell reiterated this sentiment on Wednesday and said it would likely take longer for the central bank to gain this confidence when speaking with reporters.

The delay in rate cuts means mortgage rates will likely stay high longer. With no ease in sight, affordability will continue to be a challenge for homebuyers, who also contend with high home prices. 

“The 30-year fixed-rate mortgage increased for the fifth consecutive week as we enter the heart of Spring Homebuying Season,” Freddie Mac’s Chief Economist Sam Khater said. “On average, more than one-third of home sales for the entire year occur between March and June. With two months left of this historically busy period, potential homebuyers will likely not see relief from rising rates anytime soon.”

If you are ready to shop for the best rate on a new mortgage, consider visiting an online marketplace like Credible to compare rates and get preapproved with multiple lenders at once.

BUY A HOME IN THESE STATES TO GET STUDENT LOAN DEBT RELIEF

How higher rates are impacting housing

Homebuyers are looking for ways to lower their costs as high mortgage rates persist. Recently, there have been an increase in proptech solutions, down payment assistance and even rate buydowns, Percy.AI Founder and CEO Charles Williams said. 

“Homebuyers are looking to use whatever incentives they can score,” Williams said. “We expect some of these initiatives to remain even after rates start heading down meaningfully, which is unlikely this year.”

Buyers have also increasingly turned to adjustable-rate mortgages (ARMs) for a discount. Compared to more traditional mortgage products, ARMs offer lower initial interest rates before adjusting to higher rates in the future. 

“With affordability remaining a challenge, more prospective buyers are turning to adjustable-rate mortgages to lower their monthly payments in the short-term,” Bob Broeksmit, the Mortgage Bankers Association president and CEO, said. “The ARM share of applications last week reached 7.8% – the highest level this year.”

If you’re looking to become a homeowner, you could still find the best mortgage rates by shopping around. Visit Credible to compare your options without affecting your credit score.

HOMEOWNERS COULD SAVE TENS OF THOUSANDS IN DAMAGES BY USING SMART DEVICES

Home prices increase

Buyers waiting for relief from high home prices will have to wait longer. Home prices are now 6.4% above their level last year, up from the 6% increase registered in January, according to the latest S&P CoreLogic Case-Shiller national home price index report.  

Fannie Mae readjusted its home price projection and forecasts upward, forecasting prices to increase 4.8% annually in 2024 and 1.5% in 2025.

“Buyers are mainly waiting to see if prices go down, too, to balance things out,” Williams said. “That is not likely to happen soon. So, buyers who can afford a home are buying, but only if they can outcompete in this crazy market.”

One way to use your home’s equity is through a cash-out refinance to help you pay down debt or fund home improvement projects. Visit Credible to find your personalized interest rate without affecting your credit score. 

THIS IS THE #1 CITY FOR FIRST-TIME HOMEBUYERS, AND OTHER HOT US HOUSING MARKETS

Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.

Source: foxbusiness.com

Apache is functioning normally

Co-Issue, MERS Audit Products; Retirement, Wholesaler Lawsuit, MBA and CFPB Requesting Info

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Co-Issue, MERS Audit Products; Retirement, Wholesaler Lawsuit, MBA and CFPB Requesting Info

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Fri, May 31 2024, 11:42 AM

How is it that there are only three weeks until the summer solstice? Three more weeks of the amount of daylight increasing in the Northern Hemisphere, and then, if you want more sun time, head to the Southern half of the globe. If you think presidential administrations or Federal Reserves eliminate business cycles, they don’t. If your business model is based on lower rates, don’t look at this graph from the Federal Reserve. If you want some insight into builder business and builder associations, today’s “Rundown” has Christy Beck, Corporate Director of Sales and Marketing for Caruso Homes and the current President of the Raleigh-Wake County Home Builders Association (which is one of the largest HBAs in the country). If you think everything that you do is private, sorry. I’m not sure why every outfit needs to keep so much info about us. When we want to buy a ticket we should be able to buy it without our info being kept, because then it can become part of a Ticketmaster data breach and sold to bad people. (Found here, this week’s podcasts are sponsored by American Financial Resources, the mortgage lender that’s shaking things up by streamlining processes, bringing on the best humans in the business, and putting the customer experience front and center. Hear an interview with Tim Braheem on both how originators can cultivate relationships with agents in today’s market and also diversify their referral sources, so they are not so reliant solely on realtors.)

Software, Products, and Services for Lenders and Brokers

In Q4 2023, independent mortgage banks (IMBs) and mortgage subsidiaries of chartered banks reported an average net loss of $2,109 per loan, nearly double the $1,015 lost per loan in Q3. How can mortgage lenders tackle these rising costs while staying profitable? Join Kevin Peranio (PRMG), Richard Grieser (Truv), and Rob Chrisman on a webinar next week to find out. Learn from real-world examples of lenders reducing production costs through technological innovation and process optimization. June 4 at 1pm CT. Register now.

“Bueller? Bueller? Yes, you heard it right! It’s time to channel your inner Ferris and seize the day with MQMR’s Summer Special for MERS audit. Picture yourself in the role of the charismatic Ferris Bueller, effortlessly taking charge and making the most of every opportunity. Just like Ferris, you can make your MERS Audit unforgettable, and with our special offer, you’ll be saving some serious cash while you’re at it! In the words of Ferris himself, ‘Life moves pretty fast. If you don’t stop and look around once in a while, you could miss it.’ At MQMR, we embrace Ferris’s philosophy by staying ahead of the curve. With our proactive approach, MQMR guarantees a compliant and hassle-free MERS Audit experience! Like Ferris’s legendary day off, this MERS offer won’t last forever! Our audit professionals will ensure that your MERS audit is as spotless as Ferris’s slick moves. Schedule a call!”

“Newrez Correspondent is thrilled to announce that Co-Issue has been added to our suite of delivery methods. If you are interested in Newrez’s Co-Issue program, please contact your Regional Sales Manager. In addition to Co-Issue, we have several other delivery methods and executions that will help you succeed in today’s market. We have also added Delegated Non-QM and Closed-end Home Equity products to enhance your product offering. Not approved? Sign up today! A big thank you to all of our clients, prospects and industry partners for spending your valuable time with our team at the National Secondary in NY. You can meet Tom Van Auken, Alex Weems and Chris Nobile at the upcoming 40th Regional Conferences of the MBAs in Atlantic City, NJ, June 4-7 at the Hard Rock Hotel and Casino to discuss all that Newrez has to offer.”

Supersonic Lawsuit

Anyone can sue anyone at any time, but this particular mortgage case has some nuances, including allegedly stealing a brand.

Jet Mortgage is the Wholesale division of Home Mortgage Alliance Corporation (HMAC). Around May 1, Michael Turturro, who was the head of Jet, allegedly took a number of AEs and went to OCMBC and set up Jet Alliance Mortgage. Execs and AE going to competitors is a fairly common occurrence in the California mortgage market (and elsewhere) but taking the brand, if true, is a new twist. That’s why, in addition to other claims, HMAC has filed suit in the Superior Court of the State of California in Orange County against Turturro and his new employer OCMBC, Inc., Irvine, CA.

Santa Ana-based Home Mortgage Alliance Corporation (HMAC), the owner of Jet Mortgage, released the following statement regarding the lawsuit it has filed in the Superior Court of the State of California in Orange County against a former senior executive, Michael Turturro, and his new employer OCMBC, Inc., Irvine, CA.

The Company released the following statement. “While surprised and deeply disappointed by the events that forced us to take legal action, we intend to let the lawsuit speak for itself. We are speaking out, however, to address the rumors being spread in the marketplace about our business and our brand. Jet Mortgage is very much still in business and is actively soliciting and processing new loans. We remain committed to the wholesale market and have both the resources and the capital to deliver a superior experience to our mortgage broker clients and their customers.

“On an interim basis, Alfred Hanna, founder of both Jet Mortgage and HMAC, will assume the day-to-day leadership of Jet Mortgage until a new executive has been appointed. Hanna remains fully committed to investing in, and growing, the Jet Mortgage brand. With more than 40 years of experience in all aspects of the mortgage business, Hanna has built three highly successful mortgage companies including a company that, at one time, was the largest Realtor-based mortgage company in California. Over the course of his career, Hanna has led these companies through a number of economic downturns.

“Under his leadership, we have already taken steps to deploy additional underwriting and processing resources so that the Company can continue to provide extraordinary service to our broker clients. In the weeks to come, the Company will be announcing a number of high-level, high-quality executive and account executive hires.”

Founded in 2013, HMAC is a national mortgage lender licensed in 47 states with 13 branches employing more than 175 loan officers. Its Jet Mortgage division was established in 2022 and is a national wholesale lender, serving more than 1,900 mortgage brokers nationwide.

CFPB Asks Mortgage Industry about Fees

With your opinion about a Request for Information (RFI) regarding fees imposed in residential mortgage transactions. You can access the RFI here.

The California MBA Wants to Hear From You

With your opinion about insurance. “Our association has launched a public affairs campaign to draw attention to the insurance crisis that is affecting property owners throughout the state. We know that homeowners and commercial property owners are getting dropped from their insurance carriers, facing uncompetitive costly new polices, or having to turn to the FAIR plan or force-placed insurance as a last resort.

“California MBA has the opportunity to increase awareness of how the crisis is impacting homeowners and business owners and increase pressure on policymakers to adopt swift and meaningful solutions. We are developing materials and will be distributing messages through a variety of communication channels to encourage business community engagement and coalition activation.

“We will be calling for the Legislature and Insurance Commissioner to take actions that will lead to more reliable rates, greater insurance availability, and safer communities. As such, we would like to show the harm that is occurring across the state from this crisis.

“Can you help by sharing examples of how the insurance crisis is impacting your business or your customers? We would like to point to real-life examples of the consequences across California. Here is a link to fillable form to enter any helpful information or examples. (Any questions should be addressed to California MBA CEO Susan Milazzo.)

Capital Markets

There’s not a lot of reason for rates to drop much. But is U.S. economic growth going to slow enough to help the Fed’s fight against inflation? We learned yesterday that Q1 Gross Domestic Product was revised downward to 1.3 percent from 1.6 percent, as expected but primarily driven by weaker consumer spending, which grew at 2.0 percent, down from the previous estimate of 2.5 percent. Initial jobless claims remained stable, in line with expectations and indicating a generally solid labor market. Pending home sales experienced a notable decline in April, with contract signings dropping across all regions, particularly in the Midwest and West.

Today’s month-end session brings Fed favorite Personal Core Expenditures, the Fed’s favorite gauge of inflation. For April it was +.2 percent, year over year +2.7 percent. Expectations were for the core PCE Price Index increasing 0.3 percent month-over-month and 2.8 percent year-over-year, unchanged from March, with personal income and spending (+.2 percent) increasing 0.2 percent and 0.4 percent, respectively. The core deflator year over year was +2.8 percent, as expected. Later today brings Chicago Purchasing Managers Index for May, and remarks from Atlanta Fed President Bostic. We begin the last day of the shortened workweek with Agency MBS prices a touch better from Thursday’s close, the 10-year yielding 4.53 after closing yesterday at 4.55 percent, and the 2-year still much higher at 4.92.

Employment

What are you doing for the next 25 years? ACC has been doing Non-QM for the past 25 years. ACC is seeking five (5) well-qualified Account Executives or a team that is looking for support, pricing, culture, and stability. ACC is the company that continued lending throughout COVID and the GFC. Recent article talks about ACC’s vision: ACC’s Senko talks non-QM outlook. Please send your resume for confidential interview.

“Evergreen Home Loans proudly marks 35 years of our innovative Security Plus Seller Guarantee®, the first of its kind in the industry. Our program provides an upfront, guaranteed financing commitment with minimal conditions. If we don’t uphold our commitment, we will pay the seller $5,000*, making your offer more attractive and giving you a competitive edge. Over the past 35 years, Security Plus has empowered countless buyers and sellers, simplifying the home buying process and ensuring confidence. As we continue to lead with innovative, customer-focused solutions, we invite talented loan officers and branch managers to join our team. Be part of a company that values excellence and innovation and help us continue making a difference in the home buying experience. To see available jobs here. *View disclosures here.

“Canopy Mortgage is on the rise, attracting top-producing loan officers nationwide and maintaining profitability as we advance through Q2! In a challenging market, how many national lenders can claim profitability this year? Few, if any. Canopy Mortgage is charging ahead with significant momentum, seeking branch managers to join our success story. We empower LOs with cutting-edge technology that streamlines processes and significantly reduces the cost to fund a loan. Come meet us in person at the Mastermind Summit in Vegas June 5-7 or call Josh Neumarker at 888-696-9076 – For more information or to schedule an exclusive Tech-Demo and see our innovative solutions in action.”

Mark Teteris writes, “30+ years flies by, even in the mortgage business, and I have decided to retire, effective June 1st. I was thrilled to join Optimal Blue nearly ten years ago and hope that I have played some small part in the amazing success the company has had over these years, and which I’m sure OB will continue to enjoy in the future. From the early days as an individual contributor and ‘rainmaker’ to building a new department within the sales organization to the director role I enjoy today, I have always felt at home here at Optimal Blue. That is a testament to the wonderful leadership and colleagues that make this place special. As part of my succession plan, Steven Baselice has been named the new Director of Solutions Specialists for Optimal Blue, effective June 1st.”

 Download our mobile app to get alerts for Rob Chrisman’s Commentary.

Source: mortgagenewsdaily.com

Apache is functioning normally

National mortgage rates were mostly up compared to a week ago, according to rate data compiled by Bankrate. Average rates for 30-year fixed, 15-year fixed and jumbo loans increased, while 5/1 ARM rates decreased.

The multiple rate cut predictions from the start of the year may be no more, as many experts expect rates to stay higher for longer. The movement of fixed mortgage rates parallels the 10-year Treasury yield, which moves as investor appetite fluctuates with the state of the economy, inflation and Federal Reserve decisions. At the close of the latest Fed meeting on May 1, policymakers held firm and opted not to cut rates. The recent April Consumer Price Index (CPI) data shows inflation declining, but still not to the 2 percent rate the Fed wants.

“The market was enamored with a slightly lower CPI. We are in a ‘buy on any positive news no matter how modest’ state,” says Dick Lepre of RealFinity.

Often, the decision to buy a home isn’t based on market shifts. It comes down to what you need. Depending on your situation, it might make sense to take a higher rate now and refinance later. This way you can start building equity, rather than hoping for a future of more favorable rates and home prices that might not materialize.

Rates last updated May 30, 2024.

These rates are Bankrate’s overnight average rates and are based on the assumptions here. Actual rates available across the site may vary. This story has been reviewed by Suzanne De Vita. All rate data accurate as of Thursday, May 30th, 2024 at 7:30 a.m. ET.

30-year mortgage climbs, +0.14%

Today’s average 30-year fixed-mortgage rate is 7.17 percent, an increase of 14 basis points since the same time last week. A month ago, the average rate on a 30-year fixed mortgage was higher, at 7.36 percent.

At the current average rate, you’ll pay principal and interest of $676.76 for every $100,000 you borrow. That’s an increase of $9.44 over what you would have paid last week.

15-year mortgage rate goes up, +0.19%

The average 15-year fixed-mortgage rate is 6.62 percent, up 19 basis points over the last seven days.

Monthly payments on a 15-year fixed mortgage at that rate will cost $878 per $100,000 borrowed. The bigger payment may be a little harder to find room for in your monthly budget than a 30-year mortgage payment, but it comes with some big advantages: You’ll come out several thousand dollars ahead over the life of the loan in total interest paid and build equity much faster.

5/1 adjustable rate mortgage retreats, -0.21%

The average rate on a 5/1 ARM is 6.34 percent, ticking down 21 basis points since the same time last week.

Adjustable-rate mortgages, or ARMs, are mortgage terms that come with a floating interest rate. To put it another way, the interest rate will change at regular intervals, unlike fixed-rate mortgages. These loan types are best for those who expect to refinance or sell before the first or second adjustment. Rates could be substantially higher when the loan first adjusts, and thereafter.

While borrowers shunned ARMs during the pandemic days of super-low rates, this type of loan has made a comeback as mortgage rates have risen.

Monthly payments on a 5/1 ARM at 6.34 percent would cost about $622 for each $100,000 borrowed over the initial five years, but could ratchet higher by hundreds of dollars afterward, depending on the loan’s terms.

Jumbo mortgage interest rate trends upward, +0.08%

The average jumbo mortgage rate is 7.22 percent, up 8 basis points over the last week. This time a month ago, the average rate for jumbo mortgages was higher at 7.44 percent.

At the average rate today for a jumbo loan, you’ll pay a combined $680.14 per month in principal and interest for every $100,000 you borrow. That’s up $5.41 from what it would have been last week.

Refinance rates

Current 30 year mortgage refinance rate advances, +0.12%

The average 30-year fixed-refinance rate is 7.18 percent, up 12 basis points from a week ago. A month ago, the average rate on a 30-year fixed refinance was higher at 7.36 percent.

At the current average rate, you’ll pay $677.43 per month in principal and interest for every $100,000 you borrow. That’s an additional $8.09 per $100,000 compared with last week.

Where are mortgage rates heading?

The rates on 30-year mortgages mostly follow the 10-year Treasury yield, which changes with the market, while the cost of variable-rate home loans more directly mirrors the Fed’s moves.

If and when the Fed cuts interest rates depends on economic reports of new data, such as the inflation rate and the jobs market. April’s CPI data — which measures inflation — showed inflation at 3.4 percent. While inflation has fallen since its peak in 2022, it’s still above the Fed’s target rate of 2 percent.

“The April CPI report revealed that the rate of inflation has cooled for the first time in 6 months,” says Melissa Cohn of William Raveis Mortgage. “While this one report is not enough evidence of cooling inflation to get the Fed to implement a rate cut, it is the first step.”

Broader economic factors, such as inflation and employment, affect the Fed’s decisions on rate changes, but your rate is also affected by your personal finances. Depending on your credit score, down payment, debts and income, you could be quoted a rate that’s higher or lower than the trend.

What today’s rates mean for you and your mortgage

Mortgage rates change daily, but it appears that, for now, they will remain above the historical lows of recent years. If you’re shopping for a mortgage, it might be wise to lock your rate when you find an affordable loan. If your house-hunt is taking longer than anticipated, revisit your budget so you’ll know exactly how much house you can afford at current market rates.

To help you uncover the best deal, get at least three loan offers, according to Freddie Mac research. You don’t have to stick with your bank or credit union, either. There are many types of mortgage lenders, including online-only and local, smaller shops.

“All too often, some [homebuyers] take the path of least resistance when seeking a mortgage, in part because the process of buying a home can be stressful, complicated and time-consuming,” says Mark Hamrick, senior economic analyst for Bankrate. “But when we’re talking about the potential of saving a lot of money, seeking the best deal on a mortgage has an excellent return on investment. Why leave that money on the table when all it takes is a bit more effort to shop around for the best rate, or lowest cost, on a mortgage?”

More on current mortgage rates

Methodology

Bankrate displays two sets of rate averages that are produced from two surveys we conduct: one daily (“overnight averages”) and the other weekly (“Bankrate Monitor averages”).

The rates on this page represent our overnight averages. For these averages, APRs and rates are based on no existing relationship or automatic payments.

Learn more about Bankrate’s rate averages, editorial guidelines and how we make money.

Source: bankrate.com