What's Ahead For Mortgage Rates This Week - June 15, 2015

Retail Sales, Consumer Confidence Up

Retail sales rose for the third consecutive month. May sales increased at a seasonally adjusted rate of 1.20 percent according to Commerce Department data. Auto and gasoline sales led the charge to higher retail sales, but analysts said that most retail sectors posted gains. Upward revisions of March and April's retail sales provided evidence of stronger economic conditions.

Consumer sentiment jumped nearly four points from May's reading of 90.7 to 94.6 in June. This appears to be great news compared to the year before the recession, when consumer sentiment averaged a reading of 86.9.

Weekly Jobless Claims, Mortgage Rates

Weekly jobless claims rose last week and were also higher than expected. 279,000 new jobless claims were filed against an expected reading of 275,000 new claims and the prior week's reading of 277,000 new jobless claims. This was the fourteenth consecutive week that new jobless claims remained below 300,000, an accomplishment that hasn't occurred in 15 years.

Mortgage rates rose sharply last week according to Freddie Mac. The average rate for a 30-year fixed rate mortgage jumped from 3.87 percent to 4.04 percent; the average rate for a 15-year fixed-rate mortgage rose from 2.08 percent to 3.25 percent and the average rate for a 5/1 adjustable rate mortgage increased by five basis points from 2.96 percent 3.01 percent. Average readings for discount points were 0.60 percent for 30 and 15 year mortgages and 0.40 percent for 5/1 adjustable rate mortgages. Higher mortgage rates may sideline some home buyers as they wait to see if rates will drop or are priced out of the market. Expectations that the Fed will raise its target federal funds rate this fall may be fueling higher rates.

What's Ahead

Next week's economic news schedule includes more housing-related readings. The National Association of Home Builders Housing Market Index, the Commerce Department's reports on Housing Starts and Building Permits along with the weekly reports on new Jobless Claims and Freddie Mac's mortgage reports are set for release. On Wednesday, the Federal Open Market Committee of the Federal Reserve will release its post-meeting statement and Fed Chair Janet Yellen will also give a press conference. These events are important as they may shed light on the Fed's intentions for raising rates. When the Fed raises the target federal funds rate, mortgage rates and interest rates for consumer credit are expected to rise as well.

Hunting for the Best Local Schools? Here Are 5 Checklist Items You'll Want to Look For

There are numerous factors that you may review when choosing a new place to live. If you have children, the quality of the schools and the level of education that your kids will receive in the schools is important. However, you may not be certain how to determine if a school is good or not. When you are looking at schools, use this helpful checklist to guide you in making a great decision.

Achievement Data

One of the easiest factors for you to research about different school districts and individual schools is achievement data. This may include the percentage of students graduating high school versus dropping out, the enrollment percentage for college, SAT and ACT scores and other relevant data. This is typically published online, or a call to the district's office may provide you with the information.

Student to Teacher Ratio

The student to teacher ratio can vary drastically between school districts. This will impact how much personal attention your child receives as well as how crowded the classrooms are. Generally, the lower the number, the better overall experience your child may receive.

A Safe Location

The last thing you may want is for your child to be exposed to safety issues or to feel threatened or intimidated in school or while getting to or from school every day. You can research crime statistics online for the area surrounding the schools, and you can visit the school personally to visibly inspect the area.

Extracurricular Activities

The school age years are a time for kids to experience many new things. Everything from a drama and art club to a wide range of sports can benefit kids. Consider reviewing extracurricular activities available for younger and older students alike so that you can get a better idea for the experiences that a child may have outside of the classroom.

A Positive Environment

A final important factor to consider is the environment in the school. You will need to set up a tour of the school to experience this yourself. The staff members and students should be happy and positive. Remember that this is a place where your child may spend many long hours each day.

Where you choose to live will impact what school your child attends. Therefore, it is important to review the schools carefully before you make a final buying decision for a new home.

The Pros and Cons of Using Spare Funds to Pay Your Mortgage Down Faster

A home mortgage payment can be a large or even the largest expense in a person's budget, and not having this payment any longer can be a life changing experience. Because of this, you may be dreaming about the day when you no longer have to make this payment. Some people may even actively make extra payments to their mortgage in order to pay the outstanding balance off more quickly. These may be funds from an IRS tax refund, cash received from the holidays or a birthday or some other windfall. Before you make the decision about whether to use spare funds to pay your mortgage down more quickly, consider these pros and cons.

The Benefits of Making Extra Mortgage Payments

You can shave many years off of your home mortgage when you make even a single extra payment each year. This can help you to achieve long-term financial goals, build equity and avoid paying more than necessary in interest charges. Keep in mind that any principal that is removed from the outstanding balance now will not generate interest charges going forward. This can have a snowball effect on your home equity, and this is especially true when you make extra payments on a regular basis.

Why Extra Payments Are Not Always the Best Option

Clearly, there are some great benefits associated with making extra payments on your home mortgage. However, there are also some downsides to consider before you take this step. Your home mortgage may be one of your debts with the lowest interest rate.

For example, many mortgage interest rates today are below five percent while some credit card rates may exceed 15 or 18 percent. Over the long-term, you may benefit more from savings on interest charges by reducing higher interest rate debts. Even if you have no other debts besides your home mortgage payment, you may be able to invest the money for a higher return than the interest rate on the mortgage.

Each person has different short and long term goals as well as a different financial situation to consider. With how low mortgage rates are today, however, many will benefit from paying off high interest rate debts and making smart investment decisions with any extra money they have.

What's Ahead For Mortgage Rates This Week - May 26, 2015

Last week's economic reports included several readings related to housing The Wells Fargo/National Association of Home Builders Housing Market Index, the Commerce Department's releases on Housing Starts and Building Permits, and the National Association of Realtors® report on Existing Home Sales supplied mixed news on recent developments in housing. Freddie Mac and the Labor Department released their usual reports on mortgage rates and weekly jobless claims. The details:

NAHB: Builder Confidence Slips, But Remains Positive

The Wells Fargo/ National Association of Home Builders (NAHB) released its Housing Market Index report for April. Although April's reading was two points lower at 54, any reading over 50 indicates that more builders consider housing market conditions positive than not. April's reading on builder confidence was the 11th consecutive index reading over 50.

According to NAHB, builder confidence in present housing market conditions dropped by two points to a reading of 59, while builder confidence in market conditions over the next six months rose one point to 64. Builder expectations for buyer foot traffic dropped by one point to 39. The lower readings for buyer traffic could be related to more home shoppers starting their home search online.

Building Permits, Housing Starts Show Improvement

The Commerce Department reported that building permits for April were higher at 1.14 million as compared to the March reading of 944,000 permits issued in March. Analysts expected a reading of 1.03 million permits issued, This was the highest reading for building permits since mid-2008.

Housing starts rose by a noteworthy 20 percent to a reading of 1.14 million in April, but analysts cautioned that this reading was inconsistent with the more moderate pace of improvement in overall housing markets. The Commerce Department reported that starts of single family homes rose by 17.60 percent to a reading of 666,000 starts. This was the highest rate of single-family starts since early 2008, but analysts noted that April's high reading for housing starts could reflect delayed starts that were impacted by winter weather.

Existing Home Sales Fall Due to Rising Home Prices

The National Association of Realtors® reported that sales of previously owned homes dropped as home prices increased. A tight supply of available homes and higher home prices slowed the sales pace of existing home sales. April sales of existing homes fell from the March level of 5.21 million sales to 5.04 million sales; analysts had forecasted a higher sales volume of 5.24 million existing homes sold.

Rising home prices pose challenges to first-time and moderate income home buyers, and strict mortgage standards can make it tough for those with less than stellar credit scores to qualify for mortgages. Rising home prices are good news for homeowners as bidding wars have been reported in high-demand areas.

Mortgage Rates Lower, Jobless Claims Up

Freddie Mac reported that average mortgage rates were slightly lower. Mortgage rates for a 30-year fixed rate mortgage dropped by one basis point to 3.84 percent. Discount points rose from 0.60 to 0.70 percent. Mortgage rates for a 15-year fixed rate mortgage averaged 3.05 percent with average discount points of 0.60 percent. The average rate for a 5/1 adjustable rate mortgage was one basis point lower at 2.88 percent; discount points were unchanged at 0.50 percent.

Weekly jobless claims rose to 274,000 new claims filed. This reading exceeded expectations of 269,000 new claims and the prior week's reading of 264,000 new claims. Analysts said that although this was a four-week high for new unemployment claims, layoff s remain low. Year-over-year, new jobless claims were 16 percent lower. New jobless claims remain close to a 15-year low and layoffs hit their lowest level on record. This news could build prospective home buyer confidence as job security plays a major rrole in most decisions to buy a home.

What's Ahead

This week's housing related reports include the S&P Case-Shiller 10 and 20-City Home Price Indexes and the FHFA Home Price Index. New and Pending Home Sales reports and the usual mortgage rates and weekly jobless claims reports are also scheduled.

Concrete Countertops: Learn Why Concrete May Be the Best Thing to Hit Your Kitchen

Updating your kitchen may be a project that you have been looking forward to for a long time. Now that the time has come to get started working on your project, you may be exploring the different materials that are available to use in your kitchen. The counter tops are often a prime focal point for a kitchen remodeling project. While there are several materials available to consider, concrete may be the best option for a number of reasons.

Endless Design Options

Concrete is a popular material that is used on patios, decorative floors and more because it can be stained, scored and shaped with almost endless possibilities. Just as the design options are limitless for other areas of the home, the same holds true when using concrete for your counter tops. You can customize the size, shape, finish, edge style and color without limits to achieve the desired look for your space.

Affordable Material

Concrete is not quite as affordable as laminate counter tops, but it is far more affordable than most other options. It also has a higher end look than laminate, and it can be poured, scored, and stained to mimic other higher end materials. This is a great way to get a luxurious look for your counter tops without paying a high price for them.

Highly Durable

Like many other materials that you may be thinking about for your counter tops, concrete will need to be sealed for long-lasting beauty and style. Once sealed, this is a material that is resistant to damage from heat exposure, staining, water exposure and more. Essentially, it is one of the most durable materials that you can use in your kitchen.

The kitchen is by all accounts a functional room, and counters will be exposed to heat, water, sharp edges and more over the course of time. Concrete is a material that holds up well in this type of environment.

It is rarely easy to select the perfect materials to use in your home remodeling project. After all, you may be concerned about style, durability and cost, and each material may have pros and cons. After discovering the benefits of concrete counter tops, however, you may have found the material you are searching for. You can request a quote for your concrete counters and review the incredible design possibilities.

Refinancing on a FHA Mortgage? Learn More About the FHA Streamline Refinance

Home buyers are often drawn to the FHA mortgage program due to the low interest rates, low closing costs and generally attractive loan terms. However, there will come a time when many who have an FHA mortgage want to refinance. After all, refinancing a mortgage may allow you to tap into your home's equity, obtain a lower interest rate, extend or shorten the loan term or achieve other goals you may have. While there are different loan programs that you can use to refinance, many are taking advantage of the FHA streamline refinance program.

What Is the Streamline Refinance Program?

This is a unique program that is ideal for many who have an FHA loan, and this includes those who are underwater with their home mortgage. This program is unique from others because there is not an appraisal requirement. Many other programs will offer a certain loan amount based on the current value of the home. When the value has declined since the purchase, it may not be possible to refinance with other loan programs. However, this program is well-suited for such situations, and this is regardless of the amount your home has declined in value.

The Loan Terms

While one of the key selling points relates to the fact that the FHA Streamline program does not require an appraisal, there are other selling points. This is a low closing cost option that can close quickly. In addition, you can choose from a fixed or adjustable rate, and the interest rates are very competitive. There are also 15 and 30-year terms available. Plus, the loan program does not have a prepayment penalty associated with it.

Many borrowers also appreciate the fact that the underwriting process is streamlined, and there is minimal documentation required. In fact, there is not an income or employment verification in place, so you will not have to worry about providing all of the paperwork that would need to provide for other loan programs.

If you have an FHA loan currently, you may be ready to refinance. Regardless of what your current goals are for refinancing your existing mortgage, it is smart to learn more about the FHA Streamline mortgage. With how easy it is to qualify and how attractive the loan terms are, this may be the loan program that you have been searching for. You can speak with a home loan specialist about the qualification requirements and loan terms that you may qualify for under this program.

Freelancing in 2015? Three Tips for How to Secure a Mortgage if You're a Self-Employed Entrepreneur

If you are self-employed, either as a freelancer or as the owner of your own business, your income can fluctuate greatly from year to year. That can make it difficult to get approved for a mortgage, although there are some things you can do to improve your chances. Here are three tips for securing a mortgage if you are self-employed.

Make Sure Your Credit Score Is In Good Shape

While your ability to pay back a mortgage is the most important factor in approval, your credit score is a close second, and that goes for every borrower, not just those who are self-employed. If you have a credit score in the high range -- something above 750 or 760 -- it will help you get approved for a mortgage. To boost your score, make sure you pay all bills on time, pay down your debt levels and don't make any new big purchases or apply for new credit soon before you apply for a mortgage.

Have a Large Down Payment

The more money a bank lends you to buy a house, the more risk it is taking in that the money won't be paid back. If you are self-employed and considered a higher risk to begin with, one way you can alleviate some of that risk is to be able to put down a large amount of money. Putting down 20 percent is standard for a conventional loan, and you should be willing to contribute at least that much. Putting down at least 20 percent also will save you money in the long run, because you won't have to pay for mortgage insurance and you will pay less in finance charges over the life of the loan.

Have Significant Assets

One way to put a lender at ease about your ability to pay for a mortgage is to have significant reserves in the form of assets. If you have large amounts of money in regular savings, brokerage and retirement accounts, it offers a reserve for you to tap should your income take a dive. Other forms of property, such as personal and business property that's paid off and has value, also help.

If you are self-employed and are thinking about buying a home, contact a mortgage professional to discuss your situation and to see if you will be able to qualify for a home loan.