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If it is not one thing it is another! FINALLY we have seen a
HUGE increase in closed transactions and interest rates slowly sneak up as fast
as gas prices! How on EARTH did it get to 2.72 without us even noticing?? I
heard on the news today that the increase is due to a "Summer Tax". What on
EARTH will they come up to tax next?
Wait NO do not answer that question
please!! Here is the latest article on interest rates and what the government
expects to do. PLEASE STAY LOW! I am not closing my loan until June 30th
and have continued to "float" my rate! I am happy that I got my contract in
EARLY! Don't wait and try to "time" the foreclosure market! Just goes to show
we will never be able to win!
Should the
Fed keep interest rates low? Yes, say bankers and oilmen
James Cullen
Jun 17th 2009 at 5:30PM
![http://www.blogcdn.com/www.dailyfinance.com/media/2009/06/unemployment_200.jpg]()
With the
Fed Funds rate officially set in a range between zero and 0.25 percent, the
only direction for them to go is up. But when the Federal Reserve will actually
raise interest rates remains an open question. A stock-market rally that seems
to foretell an economic recovery has been clashing with weak fundamental data,
placing the Fed's policy under more scrutiny of late. Prices for oil and
gasoline have increased dramatically since the start of the year, worrying some
that the first signs of inflation from fiscal and monetary stimulus are at
hand.
A Bureau of Labor Statistics release
this morning showed that the Consumer Price Index has declined 1.3 percent in
the last year, the largest drop since 1950. On a month-over-month seasonally
adjusted basis, the CPI rose 0.1% after being flat the prior month. A similar
BLS release of the Producer Price Index showed a 5
percent decrease year-over-year in the cost of finished goods. In May, the PPI
was 0.2 percent higher compared to April, on a seasonally adjusted basis.
With unemployment approaching 10 percent and record levels
of manufacturing capacity sitting idle, the Fed must judiciously balance
raising rates to control inflation with leaving rates low to spur growth. Even
with rates near zero, the Fed can use further "quantitative easing"
-- printing money -- to restore lending activity. At the end of late August,
total outstanding Federal Reserve credit stood at $891 billion, an amount that
had held fairly steady; that amount, according to the Fed's latest disclosure,
now stands at more than $2 trillion.
A Bloomberg survey shows that the majority of
government bond dealers believe the Fed will wait at least one more year before
increasing rates. In addition to tepid CPI and PPI numbers, two other
datapoints may justify no action: weak fundamentals for oil, and bank balance
sheets.
In a conversation with DailyFinance last week, Ann
Kohler, managing director of Caris & Co., said the run-up in oil prices was
a speculative move based on inflation concerns, but that in reality, the
"fundamentals for oil are extremely weak." Oil prices have since
fallen back to under $70 per barrel, and gas prices fell sharply today after an
inventory report showed that supply levels were
much higher than anticipated.
The Fed's interest rates also greatly impact banks, which
are set to close out their books for the quarter at the end of June. Extremely
low short-term rates have helped banks acquire and retain deposits at a very
low cost, boosting profits and helping to quietly recapitalize the financial
system. Bank of America (BAC), for example, paid $2 billion less in
interest on its deposits in the first quarter of 2009 than it did in the first
quarter of 2008.
Others were not so optimistic that the Fed would make the
correct action. "I think zero is the wrong rate for almost any
economy," Jim Grant of Grant's Interest Rate Observer said in
recent days on CNBC. "The Fed has embarked on a vast experiment in moral
hazard." Grant also worries that the Federal Reserve's historical pattern
of being late to change rates will repeat itself: "Bernanke has shown a
willingness to print money and a reluctance to tighten."
VA INTEREST RATES June 17, 2009
VA Loan Rates
for 6/17/2009
![http://www.valoans.com/Images/horizontal_115.gif]()
30 year fixed
-----------------
0.000 points
5.500%
5.610% APR
15 year fixed
-----------------
0.000 points
5.500%
5.686% APR
Interest
Rate Reduction VA Loan Program
The
VA has created an Interest Rate Reduction Loan program called the Streamline
Refinance. This provides a way for current VA homeowners to lower their
interest rate with little or no out-of-pocket costs. These loans can also be
made faster and with less documentation than a typical loan.
An Interest Rate Reduction Loan or Streamline Refinance allows you to refinance
your current mortgage interest rate to a lower rate than you are currently
paying. This is only available to veterans who are refinancing their original
VA mortgage and utilized their original eligibility.
"No Cost" Streamlines let you refinance your mortgage with no
out-of-pocket expenses. One option is to let the lender pay the costs in
exchange for a higher interest rate. Another option that lets you obtain market
rates is to roll the closing costs into the new loan.
![http://www.valoans.com/Images/horizontal.gif]()
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![http://www.valoans.com/Images/titles/sub_basicsva.gif]()
- No assumptions are allowed.
- The veteran cannot receive any cash back.
- VA does not require an appraisal, any income or
employment verifications, no credit report and no termite report, yet
the mortgage must have been paid as agreed for the last twelve (12)
months and must be up to date at the time of refinancing.
- Any other liens must be subordinated to the VA loan.
- This loan can be done with
"no out of pocket money" by including all costs in the new
loan or by making the new loan at an interest rate high enough to enable
the lender to pay the costs.
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![http://www.valoans.com/Images/horizontal.gif]()
FREQUENTLY ASKED QUESTION # 24 [ -more VA Loan
questions- ]
- - - - - -
Q: VA Fees Part 2 - Who is exempt from paying the VA funding fee?
A: While there is a funding fee for a VA home loan, some people are exempt from
paying. If you are a veteran getting disability compensation for
service-related medical issues, or are entitled to get compensation if you
aren't drawing retirement pay, you are exempt from the VA funding fee for your
VA home loan. Also, surviving spouses of those who died in the service, or from
service related disabilities are also exempt. It doesn't matter in this case
whether the spouse has any of their own entitlements. Remember that the VA has
the last word on who is exempt, and some issues may be dealt with on a
case-by-case basis. If you have any doubts, ask your local VA rep to review
your service records (or your spouse's records) and get a determination from
the VA.