MBA Report: Purchase Index at 12Y Low!

Rates can go to 3% but if someone isn't working, working part-time, or concerned about their career in this environment they aren't making an offer on a new home. I think the home buyer tax credit that expired and was renewed recently pulled demand forward resulting in a lack of buyers now. Realtors tell us that well priced listings are slowly selling but action has really slowed down in the last month. Is this simply the winter seasonal slowdown or is this another leg down for the economy at large? My guess is a double-dip recession after a disappointing holiday season. Expect another large jobs bill from congress before year end.

MBA: Report Purchase Index at 12Y Low!

From the Mortgage Bankers Association...

The Market Composite Index, a measure of mortgage loan application volume decreased 2.5 percent on a seasonally adjusted basis from one week earlier. The four week moving average for the seasonally adjusted Market Index is down 1.2 percent.

The Refinance Index decreased 1.4 percent from the previous week. The four week moving average is up 1.4 percent for the Refinance Index. The refinance share of mortgage activity increased to 72.9 percent of total applications from 71.5 percent the previous week. This refinance share is the highest share since the week ending May 15, 2009.

The Purchase Index decreased 4.7 percent from one week earlier. The four week moving average is down 5.8 percent for the seasonally adjusted Purchase Index.

The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.83 percent from 4.90 percent, with points increasing to 1.17 from 1.03 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest contract rate observed by the survey since mid-May of this year.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.32 percent from 4.33 percent, with points decreasing to 1.01 from 1.15 (including the origination fee) for 80 percent LTV loans.

The average contract interest rate for one-year ARMs decreased to 6.82 percent from 6.85 percent, with points decreasing to 0.28 from 0.29 (including the origination fee) for 80 percent LTV loans.

Who's Paying the Tab?

Government Bailouts of hundreds of banks, GM, Medicare, Wars in Iraq and Afganistan. But who actually is paying for it? Aside from putting it on the big goverment charge card we have with the US Treasury, someone has to pay the tab every year. Nice infoporn from Mint.com below. Click to enlarge.

Home Buyer Tax Credit: Extension Info

Golden State: Sell Hollywood to Balance Budget?

That's your local politician trying to figure out a way to balance the state budget. California in particular has a 17 Billion dollar budget shortfall. With constitutionally required items to be paid and a populance unwilling to demand cuts or pay more taxes something has to give. Here's some of the current thinking":

"I looked as hard as I could at how states could declare bankruptcy," said Michael Genest, director of the California Department of Finance who is stepping down at the end of the year. "I literally looked at the federal constitution to see if there was a way for states to return to territory status."

Very troubling indeed. I expect to see dramatic cuts in services and a variety of tax increases of the stealth variety. Small increases on a varity of items such as gas, cigarettes, etc.

To see a piece concerning this in the WSJ click here.

Personal BK's Up 28% Over Last Year

From the American Bankruptcy Institute: October Consumer Bankruptcy Filings Reach New Highs, Up 28 Percent Over Last Year

The 135,913 consumer bankruptcy filings in October represented a 27.9 percent increase over last October's monthly total of 106,266, according to the American Bankruptcy Institute (ABI), relying on data from the National Bankruptcy Research Center (NBKRC). The October 2009 consumer filings represented an 8.9 percent increase from the September 2009 total of 124,790. Chapter 13 filings constituted 28.5 percent of all consumer cases in October, a slight increase from the September rate.

"The nearly 9 percent increase in consumer bankruptcy filings in October, together with a 7 percent jump reported in business cases, demonstrates the sustained stress on the U.S. economy,"said ABI Executive Director Samuel J. Gerdano. ABI forecasts that total bankruptcies this year will exceed 1.4 million, the highest number since 2005.

2005 had a huge spike because a federal BK reform law was put into place requiring a means tests and classes be taken. They wanted to weed out the BK filer who was abusing the system.

I also read this troubling piece put together by CNN highlighting people that are forced to save money because of job losses and illness; resorting to fishing for dinner and hunting deer. This is on their personal financial site CNN-FN/Money. Things are very very bad. Extreme Saver Article Here.

Loan mortgage calculator – Why do you need it?

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A loan mortgage calculator is an effective tool that can give you the true picture of your financial condition. It helps you to decide the size of the mortgage that you should take out. Using a loan mortgage calculator is essential because if you know how much you can afford, you can also plan out your finances beforehand. It is important to arrange for your finances before you settle for a house. In this regard, you can take assistance of a mortgage broker that can assist you in shopping around for your dream house.

Let us see how a loan mortgage calculator can help you and why you need it in the first place. There are different types of loan mortgage calculators that can help you when you take out a mortgage. The loan mortgage calculators that are used extensively include the following –

• Rent or Buy
You may be wondering whether renting is a better option than buying. If you want to figure out how your finances will turn out to be if you rent or buy, take help of a loan mortgage calculator. You will be able to find out which is a better option.

• How much do you pay if you opt for 15-year or 30-year loan term?
In case you are opting for 15-year loan term, you will have to pay more each month but the rate of interest will be low. On the other hand, if you opt for 30-year loan term, you will have to pay less but the rate of interest will be high. With the help of a loan mortgage calculator, you can find out the amount you have to pay each month.

• ARM versus FRM
A loan mortgage calculator will help you to find out how much you have to pay if you opt for adjustable-rate mortgage and fixed-rate mortgage. In case of FRM, the amount you have to pay throughout the term of the loan is predictable and fixed. But if you opt for ARM, the rates fluctuate as per rates of the market. And your monthly mortgage payments change.

Interest Rate Table by MortgageFit

• APR loan mortgage calculator
APR or the Annual Percentage Rate is the total cost of the loan. Although APR doesn’t affect your monthly mortgage payments, with the help of APR loan mortgage calculator, you can calculate the total loan cost.

Since your finances occupy center stage, it is important to work out your finances well in advance. This is because you have to continue making payments consistently for the entire loan term. And falling behind on payments means you may have to face foreclosure.