I am looking at mortgage refinance options now (with rates being so low). I am looking at 20 year fixed rate loans with cash out (with over 20% down). The 20 year term will reduce my loan term a bit, and the final monthly cost should actually be not much higher than my current payment (with taking some cash out), I think. Do any readers have opinions on these lenders (or others with competitive offers – low rates and low expenses)?
Total Mortgage – 20 year fixed rate 3.875%, total fees and points not provided :-(, apr 4.15%
American United Mortgage – 20 year fixed rate 4% [same as 30 year rate :-(], fees $2,995 (0 points), apr 4.26%
Aim Loan – 20 year fixed rate 3.875%, fees (about $4,100 I think), apr 4.02%
These are some of the best deals I have been able to find. However, companies can play games with fees and hide excessive costs in requirements they don’t consider fees (appraisal costs…). Rates can bounce around for a specific lender, so I think it make sense to watch several (not just pick out he lowest one on whatever date you first look).
Suggestions on how to tell whether specific lenders good faith estimates are accurate and comparable would be especially appreciated.
Edits:
RoundPoint – looks good, low rates, low fees, good reviews on Zillow.
Amerisave – 20 year fixed rate 3.75%, total fees and points $3,418, apr 3.87% (removed as an option – they don’t respond to customer have tons of negative reviews online about problems, poor service, etc.
Related: Fixed Mortgage Rates Reach New Low – Low Mortgage Rates Not Available to Everyone – 30 Year Fixed Mortgage Rates and the Fed Funds Rate – Mortgage terms
U.S. Home Prices Face Three-Year Drop as Supply Gains
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Sales of new and existing homes fell to the lowest levels on record in July as a federal tax credit for buyers expired and U.S. unemployment remained near a 26-year high.
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There were 4 million homes listed with brokers for sale as of July. It would take a record 12.5 months for those properties to be sold at that month’s sales pace, according to the Chicago- based Realtors group.
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In addition to the as many as 8 million properties vacant or in foreclosure, owners of another 3.8 million homes — 5 percent of U.S. households — said they are “very likely” to put their properties on the market within six months if there is improvement, according to a survey by Seattle-based Zillow.
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Owners of about 11 million homes, or 23 percent of households with a mortgage, owed more than their property was worth as of June 30, according to CoreLogic. Another 2.4 million borrowers had less than 5 percent equity in their houses and probably would lose money on a sale after paying broker fees and closing costs, CoreLogic said Aug 25.
The shadow inventory, poor job market and low net home equity positions continue to put a huge amount of pressure on the housing market. Very low interest rates help support the market but not much else does. In some locations the rental market is starting to help. But the tightening of credit standards is reducing the pool of potential buyers. While it is a good thing (because credit standards were far too loose) it still will extend the duration of a bear housing market.
I would be looking to buy now, if I didn’t own a house already (and was planning on staying long term).
Related: Real Estate and Consumer Loan Delinquency Rates 2000-2010 – 10 million More Renters In the Next 5 Years – The Value of Home Ownership – Nearly 10% of Mortgages Delinquent or in Foreclosure (Dec 2008)
Buffett Rules Out Double-Dip Recession Amid Growth
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“I’ve seen sentiment turn sour in the last three months or so, generally in the media,” Buffett said. “I don’t see that in our businesses. I see we’re employing more people than a month ago, two months ago.”
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[GE CEO] Immelt said. “We need people to be able to feel like they’re going to get loans, the process is going to work and that they understand the rules,” Immelt said. Signs across the world show growth improving as evidenced by a rise in GE’s orders
Related: Warren Buffet Webcast to MBAs – Global Economy Prospects Look Good But Also at Risk (June 2010) – Auto Manufacturing in 2009: USA 5.7 million, Japan 7.9 million, China 13.8 million
Dividends Beating Bond Yields by Most in 15 Years
Kraft Foods Inc. and DuPont Co. are among 68 companies in the Standard & Poor’s 500 Index with payouts that top the 3.78 percent average rate in credit markets, based on data since 1995 compiled by Bloomberg and Bank of America Corp. While Johnson & Johnson sold 10-year debt at a record low interest rate of 2.95 percent last month, shares of the world’s largest health products maker pay 3.66 percent.
The combination of record-low interest rates, potential profit growth of 36 percent this year and a slowing economy has forced investors into the relative value reversal. For John Carey of Pioneer Investment Management and Federated Investors Inc.’s Linda Duessel, whose firms oversee $566 billion, it means stocks are cheap after companies raised payouts by 6.8 percent in the second quarter
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S&P 500 companies’ cash probably has grown to a record for a seventh straight quarter, according to S&P. For companies that reported so far, balances increased to $824.8 billion in the period ended June 30 from the first three months of the year, based on data from the New York-based firm.
Cash represents 10.2 percent of total assets at S&P 500 companies, excluding banks and financial firms, according to data compiled by Bloomberg. That’s higher than the 9.5 percent at the end of the second quarter last year, 8.4 percent in 2008 and 7.95 percent in 2007.
“The economy is slowing down, but productivity has been so great in this country and companies have been able to make good profits,”
10-year Treasury note yields were as low as 2.42% last month. The combination of continued extraordinarily low interest rates and good earnings increase this odd situation where dividends increase and interest yields fall. Extremely low yields aimed at by the Fed continue to aid banks and those that caused the credit crisis a huge deal and harm investors.
Money markets and bonds are not attractive places to invest now. Putting money in those places is still necessary for diversification (and as a safety net – especially in cases like 401-k plans where options are often very limited). Seeking out solid companies with strong long term prospects that pay reasonable dividends is a very sensible strategy today.
Related: Where to Invest for Yield Today – S&P 500 Dividend Yield Tops Bond Yield: First Time Since 1958 – 10 Stocks for Income Investors – Bond Yields Show Dramatic Increase in Investor Confidence (Aug 2009)
Nonfarm payroll employment decreased by 54,000 job in August, and the unemployment rate increased to 9.6%, the U.S. Bureau of Labor Statistics reported today. Government employment fell, as 114,000 temporary workers hired for the census completed their work. Private-sector payroll employment continued to trend up modestly (+67,000).
The estimates were for worse news so that loss of 54,000 jobs was seen as good news. That is still pretty bad news. There was some slightly good news though in that 123,000 fewer jobs were lost in the June and July than previously thought. So the total jobs report shows a gain of 69,000 from the previously reported data. The change in total nonfarm payroll employment for June was revised from -221,000 to -175,000, and the change for July was revised from -131,000 to -54,000.
The number of unemployed persons now stands at 14.9 million. Among the major worker groups, the unemployment rate for adult men (9.8%), adult women (8.0%), teenagers (26.3%). The number of long-term unemployed (those jobless for 27 weeks and over) declined by 323,000 over the month to 6.2 million. In August, 42% of unemployed persons had been jobless for 27 weeks or more.
In August, the civilian labor force participation rate stood at 64.7% and the employment-population ratio was 58.5%. Since its most recent low in December 2009, private-sector employment has risen by 763,000.
Employment in health care increased by 28,000 in August. Thus far in 2010, the health care industry has added an average of 20,000 jobs per month, about in line with the average monthly job growth in 2009. Manufacturing employment declined by 27,000 over the month. A decline in motor vehicles and parts (-22,000) offset a gain of similar magnitude in July as the industry departed somewhat from its usual layoff and recall pattern for annual retooling.
The average workweek for all employees on private nonfarm payrolls was unchanged over the month at 34.2 hours. The manufacturing workweek for all employees increased by 0.1 hour to 40.2 hours, and factory overtime was up by 0.1 hour. The average workweek for production and nonsupervisory employees on private nonfarm payrolls increased by 0.1 hour to 33.5 hours.
Average hourly earnings of all employees on private nonfarm payrolls increased by 6 cents, or 0.3 percent, to $22.66 in August. Over the past 12 months, average hourly earnings have increased by 1.7 percent. In August, average hourly earnings of private-sector production and nonsupervisory employees increased by 3 cents, or 0.2 percent, to $19.08.
The data points to a stagnant economy. The free fall created by the credit crisis has been stopped thankfully and there is hope for better news going forward but nothing definite. Job growth is a key right now and growth of over 200,000 jobs a month is needed to really provide hope for a stronger economy, which would start to reduce the risks of sliding back into another recession (and to allow improvement on reducing the amount of the government deficit).
Related: USA Economy Lost 125,000 Jobs and Unemployment Rate Decreased to 9.5% (July 2010) – Unemployment Rate Reached 10.2% (Nov 2009) – Another 450,000 Jobs Lost in June 2009