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MechEng

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Perhaps the biggest news of the Federal Government's stimulus package is the increase to the conforming loan limit in high cost areas to as much as $700,000.

The details are still tentative and the increase is supposed to be only temporary (ya, right).

Washington Post link

The package would temporarily increase the size of jumbo mortgages that can be bought by government-sponsored Fannie Mae and Freddie Mac, from $417,000 to as much as $700,000 in high-cost housing markets.

This will obviously be a big help to high-cost housing areas suffering right now, such as California, but it only exacerbates the affordability problems for the long term (I'm assuming that the increase won't be temporary). More government intervention ultimately makes everything worse. :porked:

Redman, you may be calling your broker next week to redo your refi package again. :lmao:

Good find. This is flying under most people's radar, but could save once-upon-a-time Jumbo owners another 50bps. :banned:
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Quick question, for someone that is looking to buy Spring-Summer 2008...

what's the deal with Fannie Mae and/or Freddie Mac? Is worth it for first time buyers to consider using their lender partners? Are their benefits to using them versus any other bank/lender?

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I wanted to ask if all of you who locked in with a lender would share your experience on here. I really enjoy customer feedback and learning about what other competitors are doing right or wrong and I think this would be very helpful to others who might need a mortgage. So please, let us know how things went. Let us know if you encountered any surprises, had extra fees thrown at you or just want to report what a satisfying process it was.

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I wanted to ask if all of you who locked in with a lender would share your experience on here. I really enjoy customer feedback and learning about what other competitors are doing right or wrong and I think this would be very helpful to others who might need a mortgage. So please, let us know how things went. Let us know if you encountered any surprises, had extra fees thrown at you or just want to report what a satisfying process it was.

I talked to my Credit Union again today and the rate was 5.87%, up from 5.75 yesterday. I explained to them how they are really are not competitive with everyone else out there and they said they would work with me on that. So now I guess I am just waiting for the rate to drop again. I am hoping for 5.25-5.5% on a 30 w/o points(I am gonna pay a point though) by next week.
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Countrywide just quote me 6.25 with no points and 5.875 with one point. HOLY CRAP, I didn't realize the late day rate hike was so big. Guess that will learn me. Now I have to set a number and go with it when it hits I suppose.

Wow. I was able to get in at 5.5% with no points yesterday with CW. Timing is everything, I guess. Edited by CrossEyed
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Countrywide just quote me 6.25 with no points and 5.875 with one point. HOLY CRAP, I didn't realize the late day rate hike was so big. Guess that will learn me. Now I have to set a number and go with it when it hits I suppose.

Wow. I was able to get in at 5.5% with no points yesterday with CW. Timing is everything, I guess.
From the open of business yesterday to the close today my 30 year conforming rate is up a whopping .625 points. I've actually had people I quoted rates yesterday get irate with me today when I told them what today's rate was. As if I'm to blame they did not want to lock and chose to play the market. I'm trying to remember a time rates went up so quickly and it's not coming to me. It all happened so quickly that I'd have people accept my offer, I'd get tied up on the phone, and by the time I went to lock I'd lost all or most of my profit.
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I wanted to ask if all of you who locked in with a lender would share your experience on here. I really enjoy customer feedback and learning about what other competitors are doing right or wrong and I think this would be very helpful to others who might need a mortgage. So please, let us know how things went. Let us know if you encountered any surprises, had extra fees thrown at you or just want to report what a satisfying process it was.

I posted earlier that I locked in at 5.5% on a 30 year fixed through National City. I was skeptical of their claim that it was a "no cost" re-fi, but I have worked with this guy in the past and have some level of trust. The loan docs show my apr at a little under 5.5 and -.075 pts., which I'm told represents the lender credit for all the various costs. The only cash I'll need at closing is pro-rated interest on my existing mortgage from my last payment. There are no escrows, which I appreciate because I prefer to manage my cash myself. He told me he locked in 15 of these yesterday morning and then started e-mailing customers - now has at least 30 people that want one and of course its long gone.
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Countrywide just quote me 6.25 with no points and 5.875 with one point. HOLY CRAP, I didn't realize the late day rate hike was so big. Guess that will learn me. Now I have to set a number and go with it when it hits I suppose.

This is really the point I was trying to get across earlier in this thread. Mortgage rates do not follow the Fed rates in lock step. In reality rates will be very fluid and even more so in a market like this where the bond market is going to be all over the place. No one really knows what rates will do tomorrow, the best that can be offered are educated guesses. Since this question is what this thread was created for in the first place; My guess is that in the very near term rates will likely dip again and near the 'lows' we have recently seen but where the 'bottom' of that dip is, no one really knows. If you focus too much on the Fed you are likely to have a poor guess. Further, I would urge people to not be obsessed with finding that 'bottom' of rates and if you save money then you save money- because trying to save the most money may cost you a ton of money.
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Countrywide just quote me 6.25 with no points and 5.875 with one point. HOLY CRAP, I didn't realize the late day rate hike was so big. Guess that will learn me. Now I have to set a number and go with it when it hits I suppose.

This is really the point I was trying to get across earlier in this thread. Mortgage rates do not follow the Fed rates in lock step. In reality rates will be very fluid and even more so in a market like this where the bond market is going to be all over the place. No one really knows what rates will do tomorrow, the best that can be offered are educated guesses. Since this question is what this thread was created for in the first place; My guess is that in the very near term rates will likely dip again and near the 'lows' we have recently seen but where the 'bottom' of that dip is, no one really knows. If you focus too much on the Fed you are likely to have a poor guess. Further, I would urge people to not be obsessed with finding that 'bottom' of rates and if you save money then you save money- because trying to save the most money may cost you a ton of money.
Perhaps this large rise was related to the breaking news of the French rogue trader having a large effect on markets? If he did have a big effect it may have an impact on the need for future Fed cuts - thus the spike. If this is the cause the rates will probably drift back down.
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I missed out on jumping on this Tues/Wed and decided against locking in on Thurs when rates jumped - what's the best way to monitor rates over the coming days/weeks to find another good entry point? This thread was helpful but will it live on? Bankrate.com seems like the most helpful outside of this one so far...thanks.

Hard to tell. I told my guy to keep watching rates. I wish I had talked to him earlier in the day as I might have jumped on the 5.125/0 points, but the afternoon rate was too close to my current one. I have a feeling things will drift down again though because I don't think the economy is all of a sudden magically better. I am still skittish on stocks, but that is the nice thing about dollar cost averaging. I hate to pull any money out since we are down 15-20% from the high already and in this volatility you can get huge rallies such as the Dow's almost 9% upswing from the low on Tuesday to the high on Thursday. People that bailed out early on Tuesday aren't very happy in doing so.
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I missed out on jumping on this Tues/Wed and decided against locking in on Thurs when rates jumped - what's the best way to monitor rates over the coming days/weeks to find another good entry point? This thread was helpful but will it live on? Bankrate.com seems like the most helpful outside of this one so far...thanks.

The compare mortgage rates section on Bankrate.com is a poor place to monitor rates these days and I'm telling you this because I'm one of the people who advertise on Bankrate.com. I tried to say this the other day but the problem is no one is advertising which makes it hard to you to really compare rates. The fact that no one is advertising is because it's a cost per click advertising situation which means every time you click on a company to obtain their info they are charged. You used to have about 20-25 lenders at a given time on Bankrate and over the past few days that amount has been around 0-5. This means several things. You don't have enough sample size to use, we either don't like advertising on Bankrate.com or simply can't afford to advertise for long because we are getting clicked to often since there is no one else to click and for you most of all because there is not much competition I've noticed the rate offerings are not as competitive as they once were.
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Im still holding out. :bag:

While I think you may have missed the absolute best time rates are improving today so hang in there.
Still not sure on that. The Fed didn't do that cut on a whim. Even though lots of people are trying to pull the French Bank fraud in as the reason, the 0.75 cut was expected already, so only the timing may have been moved forward because of the World markets falling. There is no need to make a move that big unless everyone thinks that there are pretty big issues. I also don't think that it is just going to solve the issues instantaneously. Maybe rates did spike down too low, but I wouldn't be surprised to see them hit that low again if the stock market keeps doing what it is today.ETA: I am absolutely not an expert in any way shape or form, so this is just my observations.
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I locked in earlier in the week at 6.125% (no points) with a LTV 87.35% and lender paid MI. I close next week and had previously locked in with a couple of other banks at much higher rates. My mortgage broker only had a handful of banks offering the lender paid MI and my mistake was locking in with a couple of them too soon. However, I initially locked in at 6.75% and then down to 6.5% before ending up with 6.125%. All things considered I'm pretty happy where I ended up. I might be one of the only people in my state to have bought a house in January but I'm quite happy with the price I paid and the price I was able to get on the condo I sold. Trying to figure out what mortage rates are going to do is a very tricky business.

I missed out on jumping on this Tues/Wed and decided against locking in on Thurs when rates jumped - what's the best way to monitor rates over the coming days/weeks to find another good entry point? This thread was helpful but will it live on? Bankrate.com seems like the most helpful outside of this one so far...thanks.

Hard to tell. I told my guy to keep watching rates. I wish I had talked to him earlier in the day as I might have jumped on the 5.125/0 points, but the afternoon rate was too close to my current one. I have a feeling things will drift down again though because I don't think the economy is all of a sudden magically better. I am still skittish on stocks, but that is the nice thing about dollar cost averaging. I hate to pull any money out since we are down 15-20% from the high already and in this volatility you can get huge rallies such as the Dow's almost 9% upswing from the low on Tuesday to the high on Thursday. People that bailed out early on Tuesday aren't very happy in doing so.
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Im still holding out. :thumbdown:

While I think you may have missed the absolute best time rates are improving today so hang in there.
Still not sure on that. The Fed didn't do that cut on a whim. Even though lots of people are trying to pull the French Bank fraud in as the reason, the 0.75 cut was expected already, so only the timing may have been moved forward because of the World markets falling. There is no need to make a move that big unless everyone thinks that there are pretty big issues. I also don't think that it is just going to solve the issues instantaneously. Maybe rates did spike down too low, but I wouldn't be surprised to see them hit that low again if the stock market keeps doing what it is today.

ETA: I am absolutely not an expert in any way shape or form, so this is just my observations.

Honestly when it comes to predicting rates you've got as good a chance as anyone to be right. I know I'm not expert at predicting were rates will go. I subscribe to several different sources which provide their "expert" analysis and I've found them to be about as accurate as paying a gambling pick service.

My main reasoning for being skeptical that rates will fall is that anytime you are near historic lows I just don't think you can expect to get down to that level. The rates a few days ago were the lowest in 4 year and they were extremely close to those levels which were the lowest rates in 40 years. In fact in my opinion the rates were a little closer to that period 4 years ago than people realize but it's now harder for a borrower to obtain the best rates due to the playing field getting thinned out. A few days ago for instance I had the 30 year fixed at 4.875% paying back 2/10th of a point. In the highly competitive environment in 2002-2003 I would have have offered that loan at half a point for a strong credit borrower with a decent loan size but this week I'd have charged a point or close to it as I knew that would be competitive enough. I'm not using financial data but more of a feeling that to expect rates to come down to that level again might be expecting to much. I hope you are right of course but more than anything from my angle I like stability. When rates jump around it is difficult to manage your pipeline and leaves to many borrowers unsure of when to lock. The trend Friday saw about a 1/8th improvement in rates.

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Perhaps the biggest news of the Federal Government's stimulus package is the increase to the conforming loan limit in high cost areas to as much as $700,000.

The details are still tentative and the increase is supposed to be only temporary (ya, right).

Washington Post link

The package would temporarily increase the size of jumbo mortgages that can be bought by government-sponsored Fannie Mae and Freddie Mac, from $417,000 to as much as $700,000 in high-cost housing markets.

This will obviously be a big help to high-cost housing areas suffering right now, such as California, but it only exacerbates the affordability problems for the long term (I'm assuming that the increase won't be temporary). More government intervention ultimately makes everything worse. :goodposting:

Redman, you may be calling your broker next week to redo your refi package again. :lmao:

Good find. This is flying under most people's radar, but could save once-upon-a-time Jumbo owners another 50bps. :thumbup:
:rolleyes:

Does this mean that jumbo loans (that used to be over $417,000) and had a higher rate will now be up to $700,000 and have the lower non jumbo rate?? Wow....that seems to be a BIG deal. Am I reading this correctly???

Edited by DanFouts
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Alright I'm stoked. I had applied with my Credit Union last week when they were offering 4.875 with 1/8th point. The guy I spoke to on the phone just took the application but couldn't lock the rate. He promised me a call back that day to lock the rate but I didn't get one. Of course, the next day rates were up a good 1/2 percent. I figured I was SOL but I just got off the phone and, as I expected, they had just been inundated with refis due to the rate they were offering and hadn't been able to get back to everyone. But, because they don't want to penalize anyone they're honoring their rates from that day. So, I'm locked in baby :confused:

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Closed yesterday at 5.5%. Saved $121/month. :lmao:

Now what are you going to do with that money saved?I would if you have kids put at least 50.00 a month to a 529. :sadbanana: Money working for you, don't be this guy with the extra money saved. :lmao:
Most likely will be adding a little extra to my IRA contributions. And adding a little extra toward some missionaries that we support.
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Perhaps the biggest news of the Federal Government's stimulus package is the increase to the conforming loan limit in high cost areas to as much as $700,000.

The details are still tentative and the increase is supposed to be only temporary (ya, right).

Washington Post link

The package would temporarily increase the size of jumbo mortgages that can be bought by government-sponsored Fannie Mae and Freddie Mac, from $417,000 to as much as $700,000 in high-cost housing markets.

This will obviously be a big help to high-cost housing areas suffering right now, such as California, but it only exacerbates the affordability problems for the long term (I'm assuming that the increase won't be temporary). More government intervention ultimately makes everything worse. :yes:

Redman, you may be calling your broker next week to redo your refi package again. :bs:

Good find. This is flying under most people's radar, but could save once-upon-a-time Jumbo owners another 50bps. :boxing:
:hey:

Does this mean that jumbo loans (that used to be over $417,000) and had a higher rate will now be up to $700,000 and have the lower non jumbo rate?? Wow....that seems to be a BIG deal. Am I reading this correctly???

That is my understanding but I think there are some certain restrictions and it will only be a limited time thing as well as the change is not suppose to be perm.
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Does this mean that jumbo loans (that used to be over $417,000) and had a higher rate will now be up to $700,000 and have the lower non jumbo rate?? Wow....that seems to be a BIG deal. Am I reading this correctly???

A lot of unknown about this right now if any restrictions will exist or if those loans will be priced any different. My guess is even with some restrictions and a price hit it's going to be considerably better rates than a current jumbo loan and will open up a new wave of refinance candidates. For sure if I had a jumbo loan right now or was looking to do a first and second to avoid a jumbo loan I'd hold off and in fact I pulled most of my advertising for jumbo loans as it seems futile to work on them now when things are about to change. Generally speaking I think it has potential to be the BIG deal you expressed.
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Does this mean that jumbo loans (that used to be over $417,000) and had a higher rate will now be up to $700,000 and have the lower non jumbo rate?? Wow....that seems to be a BIG deal. Am I reading this correctly???

A lot of unknown about this right now if any restrictions will exist or if those loans will be priced any different. My guess is even with some restrictions and a price hit it's going to be considerably better rates than a current jumbo loan and will open up a new wave of refinance candidates. For sure if I had a jumbo loan right now or was looking to do a first and second to avoid a jumbo loan I'd hold off and in fact I pulled most of my advertising for jumbo loans as it seems futile to work on them now when things are about to change. Generally speaking I think it has potential to be the BIG deal you expressed.

The tentative plan is for the increase to be effective for only one year (although I'm very confident this will ultimately become permanent) and the increased amount (if any) will vary depending upon your location. For instance, Orange County, California may have an increased conforming loan amount of $715,000 whereas neighboring Riverside County might only raised to $600,000. I have not seen any concrete information as to which area will receive what kind of bump (if any).

Here is a link discussing the potential unintended consequences from raising the conforming amount and the possibility of higher rates.

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Today's rates at Pentagon Federal Credit Union:

30 yr fixed conforming (0 points) = 5.875%

30 yr fixed conforming (.75 points) = 5.625%

15 yr fixed conforming (0 points) = 5.125%

15 yr fixed conforming (.625 points) = 4.875%

They pay the following closing costs:

appraisal

credit report

flood cert

CLO access fee

tax service fee

settlement/closing fee

Still pretty good.

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Today's rates at Pentagon Federal Credit Union:

30 yr fixed conforming (0 points) = 5.875%

30 yr fixed conforming (.75 points) = 5.625%

15 yr fixed conforming (0 points) = 5.125%

15 yr fixed conforming (.625 points) = 4.875%

They pay the following closing costs:

appraisal

credit report

flood cert

CLO access fee

tax service fee

settlement/closing fee

Still pretty good.

Absolutely. Look at the history of mortgage rates. Any 30 year fixed loan in the fives is a great deal.
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Today's rates at Pentagon Federal Credit Union:

30 yr fixed conforming (0 points) = 5.875%

30 yr fixed conforming (.75 points) = 5.625%

15 yr fixed conforming (0 points) = 5.125%

15 yr fixed conforming (.625 points) = 4.875%

They pay the following closing costs:

appraisal

credit report

flood cert

CLO access fee

tax service fee

settlement/closing fee

Still pretty good.

Does that leave you (me) with any OOP costs? If not, even dropping 1/8th a pont for free sounds worthwhile.
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Today's rates at Pentagon Federal Credit Union:

30 yr fixed conforming (0 points) = 5.875%

30 yr fixed conforming (.75 points) = 5.625%

15 yr fixed conforming (0 points) = 5.125%

15 yr fixed conforming (.625 points) = 4.875%

They pay the following closing costs:

appraisal

credit report

flood cert

CLO access fee

tax service fee

settlement/closing fee

Still pretty good.

Does that leave you (me) with any OOP costs? If not, even dropping 1/8th a pont for free sounds worthwhile.
Yes. I (you) need to pay some things.

Title insurance $550

recording fee $80

lien release $40

state mortgage tax XXX

interest due at closing XXX

prop tax escrow deposit XXX

hazard insurance escrow deposit XXX

The things with the XXX would be the same from any lender.

Also, you need to join an association for military families ($20) to be a member of the credit union if you're not in the armed forces.

Note: the above costs are what I need to pay for a $101K loan 15 yrs conforming.

Edited by dancingbones
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I'm offering 5.5% 30 yr fixed today no pts. today (amounts > 150K). Even with the good durable goods numbers this morning rates seem to be holding here. Next big number to watch is this Friday's employment numbers, this could set the tone for where rates go from there. If you locked last week before the spike....Congratulation but make sure your loan officer gets your loan closed within the lock period.

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I'm offering 5.5% 30 yr fixed today no pts. today (amounts > 150K). Even with the good durable goods numbers this morning rates seem to be holding here. Next big number to watch is this Friday's employment numbers, this could set the tone for where rates go from there. If you locked last week before the spike....Congratulation but make sure your loan officer gets your loan closed within the lock period.

:rolleyes: Still floatin here.
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My girlfriend is looking to get a 100% financed loan for about 160k, starter home. She's being quoted 6.125 for a 30 year fixed rate. Closing costs around $5k. Any suggestions on how to improve this or if it's reasonable?

Her credit score is above 770 btw.
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My girlfriend is looking to get a 100% financed loan for about 160k, starter home. She's being quoted 6.125 for a 30 year fixed rate. Closing costs around $5k. Any suggestions on how to improve this or if it's reasonable?

Her credit score is above 770 btw.
Might depend on her debt to income ratio a bit too, but if it's reasonable enough, I'd think she could do a bit better. That's a very good credit score. Is she planning on staying in the home long? I've been quoted very good rates (better than 30 yr fixed) with 5/1 Arms; this is fine with me because I'll be selling before the 5 yr point to upgrade anyway.
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My girlfriend is looking to get a 100% financed loan for about 160k, starter home. She's being quoted 6.125 for a 30 year fixed rate. Closing costs around $5k. Any suggestions on how to improve this or if it's reasonable?

Her credit score is above 770 btw.
Might depend on her debt to income ratio a bit too, but if it's reasonable enough, I'd think she could do a bit better. That's a very good credit score. Is she planning on staying in the home long? I've been quoted very good rates (better than 30 yr fixed) with 5/1 Arms; this is fine with me because I'll be selling before the 5 yr point to upgrade anyway.
100% CLTV does not come as easy as it did just a year ago- any deal you do now is not going to be the best deal out there. She may be able to find better and she should just shop around.
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My girlfriend is looking to get a 100% financed loan for about 160k, starter home. She's being quoted 6.125 for a 30 year fixed rate. Closing costs around $5k. Any suggestions on how to improve this or if it's reasonable?

Her credit score is above 770 btw.
The killer here is that she is going 100% finance. Is she a first time buyer? Does she have anything for a downpayment? There are agencies out there that have DP assistance if you go through their home buying course. Some may even contribute 5% or 10k (smaller of the two) towards your DP. Plus, it would bring down her rate. Its basically free money so i would look into that around where you are.
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Any idea what to expect out of the rates this week Chad?

I do not think you have to worry about rates going up. Talk is that the Fed is looking to drop rates by either 25 or 50 basis points and if that happens there likely will be a sympathy move in mortgage rates. My guess is that the Fed makes a 25 basis point move. I would say that you have a pretty good chance of slightly lower rates but the sympathy move might be as fleeting as the earlier one was.
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Any idea what to expect out of the rates this week Chad?

So far they are up a little today.
:rant::wall:
Mortgage rates are fluid. They will go up and down. This is what I have been trying to communicate to everyone. There is no reason to believe that rates will go up and not come back down. Hang in there, do not get too greedy and try to time it perfectly and make a good decision for you- not what Mr Jones down the street got last week. Also, stop hitting your head against the wall... concussions do not help in making solid diecisions with your mortgage. ;)
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Any idea what to expect out of the rates this week Chad?

So far they are up a little today.
My CU is back over 6% today. That Aim loan thing is 5.5%. I just want 5.5% (then pay he point to drop it) through someone I can trust. :cry:
50 bps drop in the Fed. Should see a sympathy drop in mortgages but very slight since I am sure they have already priced it in. We will have to see how the bond market reacts.
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