Mortgage rates hit 4.61 pct.; refi's could slow

By JANNA HERRON

AP Real Estate Writer

Rates on fixed mortgages rose for the fourth straight week this week. The surge could slow refinancings and further hamper the housing market.
Freddie Mac said Thursday that the average rates on 15- and 30-year fixed loans increased sharply from last week. Mortgage rates tend to track the yields on 10-year Treasury bonds. Those yields have been rising as investors anticipate Congress will extend the Bush-era tax cuts for two years and long-term unemployment benefits for 13 months.
The 30-year rate rose to 4.61 percent from 4.46 percent last week. That is well above the 4.17 percent rate hit a month ago - the lowest level on records dating back to 1971.
The average rate on a 15-year fixed loan, a popular refinance option, rose to 3.96 percent. Rates hit 3.57 percent last month - the lowest level since 1991.
Rates are rising after plummeting for seven months. Investors are selling Treasury bonds in anticipation of the tax deal President Barack Obama and Republicans forged that could boost the economy next year if passed. A stronger economy would make the stock market a more attractive place to invest money. That's a big reason why many investors are selling their safer Treasurys bonds.

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Caught by mistake in foreclosure web

By MICHELLE CONLIN

AP Real Estate Writer

Christopher Marconi was in the shower when he heard a loud banging on his door. By the time he grabbed a towel and hustled to his front step, a U.S. marshal's sedan was peeling out of his driveway. Nailed to Marconi's front door was a foreclosure summons from Wells Fargo, naming him as a defendant. But the notice was for a house Marconi had never seen - on a mortgage he never had.
Tom Williams was in his kitchen thumbing through the mail when he opened a letter from GMAC. It informed him that the bank would confiscate his house unless he immediately paid off his mortgage balance of $276,000. But Williams had never missed a mortgage payment. And his loan wasn't due to mature until 2032.
Warren Nyerges opened his front door in Naples, Fla., to find a scraggly-haired summons server standing on his stoop. He plopped a foreclosure notice from Bank of America in Nyerges' hands. But Nyerges had paid for his house in cash. And he'd never had a checking account, much less a mortgage, with Bank of America.
By now, you may have heard the stories of bank robo-signers powering through hundreds of foreclosure affidavits a day without verifying a single fact. But most of those involved homeowners who had stopped paying their mortgage. They were genuine defaulters. Now a new species of homeowner is getting pushed into foreclosure hell.

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Area Home Prices Slip From a Year Ago

By Eric Pryne

Seattle Times business reporter

 The median price of houses sold in King County slipped to a new post-bubble low last month, according to statistics released Monday by the Northwest Multiple Listing Service.
The number of sales also fell, dropping nearly one-third from November 2009's total.
"We're not out of the woods yet," said Glenn Crellin, director of the Washington Center for Real Estate Research at Washington State University.
November's median single-family sale price was $359,950, the lowest in more than five years. Prices now have dropped more than 25 percent since July 2007, when the local market peaked.
While it set a record, November's median price still was down just 2.7 percent from the same month last year.  Crellin said he expects prices will continue to drop on a year-over-year basis until mid-2011. Higher-priced homes now constitute a larger share of sales, he said, and that has kept the median price from dropping more steeply.

Those properties are selling, he said, because buyers are negotiating steep price discounts. The growing number of homes in foreclosure also should keep prices down, Crellin added.  Buyers closed on 1,092 houses in November, down 31 percent from November 2009. But the drop was expected: Last November's sales were inflated by first-time buyers rushing to take advantage of a federal tax credit for first-time buyers that had been scheduled to expire at the end of that month.  That credit later was extended and expanded but expired for good earlier this year. In Southeast King County, "it's been dead ever since," said Marti Reeder, an agent at the John L. Scott Real Estate office in Kent. "October and November were complete busts."
But December is looking brighter, Reeder added. She wrote up two offers Sunday and was writing up another Monday afternoon.

King County condo sales fell even more steeply than single-family sales in November. Closed condo sales dropped 47 percent from November 2009's total. The median price, $225,000, was down nearly 11 percent year-over-year.  House sales in Snohomish County were down 27 percent from the same month last year. The median price, $260,000, fell more than 8 percent from November 2009.  While closed sales of single-family homes fell sharply last month, pending sales offers that were accepted in November but haven't yet closed  rose 3 percent in King County. The listing service highlighted that increase in its official statement, calling it a "pleasant surprise."

It was the first year-over-year increase since the tax credits expired this spring.  But last month's total is better than November 2009's only because many potential buyers were backing off a year ago as they awaited the planned expiration of the tax credit, Crellin said.  What's more, he added, an increasing number of pending sales  especially short sales  don't close for months or don't close at all. Considering all that, the listing service's emphasis on the November increase is "a bit overstated," Crellin said.

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Time to refinance? Good question

By MICHELE LERNER

Bankrate.com

Home mortgage refinancing may sound like a good idea in theory, but it's not always possible or desirable.
For starters, lenders have tightened up the approval process, making it more difficult to get loans.
"Homeowners today need to be triathletes to qualify for a loan, with great income, great credit and great value in their home," says Anthony Hsieh, founder and CEO of loan Depot.com.
In addition, a refinance may not make sense financially, particularly for borrowers who plan to sell their homes in the next few years.
Before taking the leap and opting to refinance, homeowners should ask themselves these questions.
Do I have enough equity?
Homeowners need to have at least 80 percent equity in their home to qualify for a new loan without paying private mortgage insurance (PMI). Adding that to the cost of a new loan could negate the benefit of a refinance.
Today, many homeowners are underwater — meaning they owe more on their mortgages than the house is worth. However, being underwater or having little equity does not necessarily rule out a refi.
"Homeowners should still apply for a refinance even if they have low equity, because there are some Fannie Mae and Freddie Mac programs and FHA loans that may accept them," Hsieh says.
How soon should I refinance?
Homeowners should refinance quickly in case the housing slump deepens, causing values to depreciate even more, says Roy Meshel, district vice president for W.J. Bradley Mortgage in Phoenix.
That can make it even more difficult to qualify for a refinance.
What can help me qualify?
Patrick Cunningham, vice president of Home Savings and Trust Mortgage based in Fairfax, Va., recommends an increasingly popular approach — the so-called "cash-in" refinance.
"Some people are opting to bring cash to the settlement in order to pay down their loan balance to qualify for a refinance," he says.
Is my credit score good enough?
Borrower credit scores play a big role in securing a good mortgage rate. In fact, you'll need a good credit score to qualify for any type of mortgage.  Mortgage rates operate on a sliding scale, with the lowest rates going to applicants with the highest credit scores of 720 or higher.  Borrowers with scores below 620 will have trouble qualifying for any mortgage.

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Fed proposes stripping key lending protection for homeowners

By Tony Pugh

McClatchy Newspapers

WASHINGTON

As Americans continue to lose their homes in record numbers, the Federal Reserve is considering making it much harder for homeowners to stop foreclosures and escape predatory home loans with onerous terms.
The Fed's proposal to amend a 42-year-old provision of the federal Truth in Lending Act has angered labor, civil-rights and consumer advocates along with foreclosure defense attorneys.
They're not only asking the Fed to withdraw the proposal, they also want any future changes to the law to be handled by the new Consumer Financial Protection Bureau, which starts work next year.
In a letter to the Fed's Board of Governors, dozens of groups, including the National Consumer Law Center, the NAACP and the Service Employees International Union, say the proposal is bad medicine at the wrong time.
"At the depths of the worst foreclosure crisis since the Great Depression, we are surprised that the Fed has proposed rules that would eviscerate the primary protection homeowners currently have to escape abusive loans and avoid foreclosure: the extended right of rescission."
Because the public-comment period is open until Dec. 23, a spokesman declined to comment on the matter.
But in a September passage in the Federal Register, the Fed said the proposal was designed to "ensure a clearer and more equitable process for resolving rescission claims raised in court proceedings" and reflects what most courts already require.
Since 1968, the Truth in Lending Act has given homeowners the right to cancel, or rescind, illegal loans for up to three years after the transaction was completed if the buyer wasn't provided with proper disclosures at the time of closing.

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Mortgage rates rise to 4.46 pct. as economy lifts

By DANIEL WAGNER

AP Business Writer

Rates on fixed mortgages edged up again this week after hitting their lowest level in decades last month.
Freddie Mac said Thursday that the average rate for 30-year fixed loans rose to 4.46 percent from 4.40 percent last week. Three weeks ago, the rate hit 4.17 percent, the lowest level on records dating back to 1971.
The 15-year loan also rose, to 3.81 percent from 3.77 percent. It hit its lowest point since the survey began in 1991 a month ago, when rates fell to 3.57 percent.
Mortgage rates are rising because strong economic news has drawn investors away from the safety of Treasury bonds. As demand for Treasurys decreases, investors demand higher yields from the government. Mortgage rates tend to track those yields.
Those yields have risen from yearly lows as the economic picture brightened over the past month. They climbed again Wednesday after reports showed factories boosting production, auto sales rising and many regions of the country seeing stronger economic growth.
To calculate average mortgage rates, Freddie Mac collects rates from lenders across the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a single day.
Rates on five-year adjustable-rate mortgages averaged 3.49 percent, up from 3.45 percent a week earlier.
Rates on one-year adjustable-rate home loans edged up to 3.25 percent from 3.23 percent last week.

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Futuristic, low-priced homes with a past finally go on sale

By Tristan Baurick

Kitsap Sun

BAINBRIDGE ISLAND — If you ever dreamed of living in an iPod, now's your chance.
Two cutting-edge prototype homes, once heralded as the future of urban housing, are on sale on Bainbridge Island after a convoluted journey that took them from the roof of a downtown Seattle building to the old Bainbridge Island dump and finally to their current location on a Winslow street.
"A tremendous amount of work went into these," said Ken Balizer, executive director of Housing Resources Board (HRB), the nonprofit affordable-housing organization that hopes to sell the small, stackable homes for under $130,000 apiece.
Billed as "Ikea meets iPod" when they were unveiled three years ago, the homes are shiny, sleek and loaded with earth-friendly features and a few high-tech gizmos that baffle even Balizer.
The one-bedroom homes were built with energy-efficient windows, insulation, lighting and appliances; occupancy sensors to control lights and heat; recycled flooring materials; and a vegetated roof to reduce stormwater runoff.
The smaller, second-story unit, listed at just under $105,000, has 475 square feet of living space and a covered deck. The ground-floor, $129,900 unit has almost 700 square feet of living space.
HRB hopes to sell the homes to income-qualified homebuyers. The units would be owned by the occupants, the land underneath by HRB.
The homes were donated to HRB by Unico Properties, a Seattle firm that planned to manufacture them as a less-expensive alternative to Seattle condos. Unico prominently displayed the units on the roof of Rainier Square to drum up interest. When the plan didn't pan out, the units were moved to Bainbridge Island for use as low-cost housing at a city-owned Day Road farm.
But farmers objected because the homes wouldn't be limited to farmworkers. After another move fell through, the homes were stripped and stored at the former Bainbridge Island dump for six months. Last spring, they were brought to their current location on Knechtel Way.
HRB spent about $185,000 to move and restore the units. The most recent effort to relocate and fix up the homes was assisted by a volunteer construction manager, landscape architect, engineer, attorney and about 20 others, Balizer said.

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