The Mortgage Bankers Association’s latest forecast says the 30-year fixed rate could average 4.9 percent by the third quarter and reach 5 percent by the end of 2014.
But there’s a good chance rates will remain stable through the summer, says Peter Grabel, senior mortgage loan originator for Luxury Mortgage Corp. in Stamford, Connecticut.
“I don’t feel there’s any reason for rates to change a lot,” he says. Still, if you like the rate you have today, don’t waste time. “They are not that much off all-time lows. There’s only room for them to go in one direction and that’s up.”
Getting a mortgage these days is obviously not as easy as it was during the housing boom, when pretty much anyone could get a loan.
But after years of tightening, it seems like the standards are loosening up a bit.
“We are seeing underwriters have a little more flexibility with some common-sense issues,” Grabel says. “That’s not a suggestion we are going back to the old days.”
Standards have loosened mostly for larger loans, or jumbo loans, because they are not the types of loans that get sold to Fannie Mae and Freddie Mac. The institutions have their own guidelines and lenders must follow them if they want to sell the loans after they issue them.
FHFA to Change Guidelines
Mel Watt, the new head of the Federal Housing Finance Agency, recently said his office will change some of the guidelines to allow lending to borrowers with slightly lower credit scores. The FHFA oversees Fannie and Freddie.
“Mel Watt reversed course for the first time in many years to say we have to loosen the current lending standards,” Hsieh says.
Some lenders also are allowing lower credit scores on FHA loans. Many lenders required borrowers to have a credit score of at least 640 for an FHA loan.
Online Source: http://www.bankrate.com/finance/mortgages/housing-trends-3.aspx
