How Is Your Home Buying Loan in Dallas TX Affected by the Global Money Market?

Feb. 17, 2010 - PRLog -- Your mortgage is a commodity just like a share of stock. Lenders bundle your loan into a group of similar loans to equal large amounts of money. This group or bundle of loans is sold on the open market to investors.

You can understand why your specific loan and the documents you sign to get it are set by the lender. If your loan does not conform to the criteria set for a ‘bundle of loans’  then you cannot get the best interest rate everyone else got because your loan cannot be sold as easily or the lender has to hold your loan themselves. Most of your documents are written using Fannie Mae guidelines.

This last week events around the world affected our market to the positive…

Rates dipped. Why?  Simple: Fears have sent money pouring into the US bond market (which includes mortgages) because, even though we have problems, we’re still the safest place to be.  Globally, the debt (i.e. government bonds) for Greece, Spain, Portugal, and other countries has  been called into question.  Add to that the recent dip in the US stock market and you have investors looking for the SAFEST place to park their money.  And THAT is with  Uncle Sam, and along with it, Fannie & Freddie.  So, if investors are going to give Fannie & Freddie their money anyway, do Fannie & Freddie have to give a higher rate to entice them? Nope. They can offer a lower rate and investors will still buy their mortgages.

But Spain just had their AAA rating affirmed, Germany is stepping in to help Greece and the stock market has stopped it slide.   So the fear is subsiding and rates are turning up again….and this trend WILL continue unless we have another global melt down.

This week rates ranged from 4.75% to 5% depending on program, credit and points.

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Whether you are buying or selling a home in Dallas, or you are relocating to the Dallas area, the The Harrison Group is here to help.