If there can be one positive tidbit from the government shutdown, it just may be lower mortgage rates. And by the way, we are still originating and closing mortgages during the government shut down. USDA has been reduced to essential functions only and therefore, loans that have not yet been approved USDA may not be closing during this time. However, conventional, FHA and VA loans are available. Not all lenders are able to operate during the shutdown because of not being able to obtain tax transcripts from the IRS, so please do confirm with your lender whether or not this is an issue for your mortgage scenario. Self employed borrowers may find it more challenging during these times.
The Jobs Report was not released today. We do not know when the September jobs data will be available. I do believe that once the shutdown is over, we will probably see a spike in rates (of course this will depend on what happens with the debt ceiling).
Let’s focus on current rates and things you can control, like refinancing to reduce your mortgage payment or mortgage term by taking advantage of this window of opportunity that many missed out on. Click here for a free mortgage rate quote for your home located in Washington state.
A couple other reasons to consider refinancing now:
- You may wind up with a jumbo mortgage if loan limits are reduced next year. If your loan amount is over $400,000, you may very well wind up not being able to refinance to a conforming rate without bringing cash-in at closing. Jumbo mortgages have higher credit score and home equity requirements than conforming mortgages.
- Home values have improved in the greater Seattle area. If you’ve been turned down for a refinance because of a lower home value, this may be a good time to revisit a refinance.
- Rates have room to go up than they do down. Mortgage rates are not at the all time lows and in my opinion, I would be surprised to that happen again anytime soon.
- HARP – Home Affordable Refinance Program is still available for borrowers with conforming mortgages that were securitized prior to June 1, 2009. HARP is available for primary homes, vacation/second homes and investment property.
Here’s a short example of mortgage rates as of 11:00 am on October 4, 2013 (for your personal rate quote with current rates, click here). Remember mortgage rates change constantly throughout the day and may have changed by the time I’ve published or that you are reading this post.
Rates are based on a rate-term refinance with a loan amount of $400,000 and credit scores of 740 or higher. You can reduce your rate by paying discount points or reduce your closing cost by increasing the rate and generating a rebate credit.
- 30 year fixed rate conventional with 80% loan to value: 4.375% (apr 4.467%) priced with 0.324 discount. Principal and interest payment (P&I) is $1997.14. Property taxes and insurance are additional.
- 15 year fixed conventional with 80% loan to value: 3.500% (apr 3.605%) priced with 0.031 rebate credit. P&I = $2,859.53.
- 30 year fixed HARP refi at 105% loan to value: 4.500% (apr 4.572%) priced with 0.221 discount. P&I = $2,026.74. NOTE: higher loan to values are available.
This is just a small example of mortgage rates. We have many other programs available and many factors (such as loan to value and credit scores) will impact the pricing of your mortgage rate.
I’m happy to help you with your refi or purchase mortgage for your home located anywhere in Washington state where I’m licensed.