Best Mortgage Rates to Be Around for a While?
Current mortgage rates are still very close to the lowest in 50 years. And there seems little prospect of that situation changing dramatically over the next few months.
The Federal Open Market Committee met June 22/23, and its members' positions seem so entrenched that Associated Press described the prospect of the key bank lending rate remaining unchanged (at zero to 0.25 percent) as "sure" and "certain." It also looks likely that the committee's minutes, which are due to be released next month, will retain the wording that it has employed for more than a year: that rates will remain low "for an extended period".
Technically, according to HSH® Associates, mortgage rates are more closely tied to U.S. Treasury, corporate debt, and other bonds, because those are the competing investments that the people who ultimately lend the money are most likely to choose. However, there's no doubt that Fed rates have a very real influence on current mortgage rates.
Mortgage Borrowers Face Tighter Financial Verifications
Meanwhile, the New York Times reported June 16 a move on the part of Fannie Mae to tighten the rules surrounding the verification of borrowers' personal financial situations. From the beginning of this month, mortgage brokers and lenders are required to recheck these just before every Fannie Mae loan is closed.
This means that borrowers would be wise to avoid running up credit card bills, taking on substantial personal loans that would appear on their credit reports, or changing jobs between signing mortgage applications and closing. Any significant deterioration in the perceived ability of a borrower to make payments could lead to loans being delayed or even refused.
However, the Times quoted Jim Pair, who is the president of the National Association of Mortgage Brokers as saying: "If everyone does what they're supposed to do, it should not be a big problem."
Mortgage Brokers and Lenders Face Tougher Regulation
Mr. Pair may be less sanguine about a new wave of mortgage industry regulation that is currently being considered on Capitol Hill. According to the House Financial Services Committee, these are--at the time of writing--still being negotiated by a House-Senate Conference Committee. But the Wall Street Journal says the industry is working to soften the proposed new rules. As they currently stand, these include
- clearer underwriting standards
- lenders retaining more responsibility for loans after they've been sold
- borrowers receiving new rights to sue for damages arising from lenders' misconduct
- new remuneration models for originators
Mortgage Quotes Now?
If you'd like the peace of mind that comes with finding the best mortgage while rates are low, and before tougher regulation disrupts the market, then you can obtain competitive mortgage quotes here.