Mortgage Meltdown?

Safemoney Report ^ | 18 Oct 2003 | Martin Weiss

[sourcery]

FYI

[Rebelbase]

Everyone who was able to refi did so when the rates dipped. If the rates stay the same, there will not be another noticable round of refi's for at least 3 years, when the ARMs mature.

[At _War_With_Liberals]

Weiss has been saying this for a year now.

He also predicted Dow 5000.

[Sabatier]

The sky is falling! The sky is falling!

[Nightmare]

This is all baloney. Mortgage rates have gone up and down dozens of times in the last few decades. Granted that some times there are short term consequences. I think this article should be renamed "tin foil hat alert".

[SC_Republican]

5.81%....yup, the end is near.

Does this guy not remember the 21% interest rates in the late 70's.

Geez.

[deannadurbin]

LOL!

I do.

[Capriole]

Everyone who has a home mortgage already refinanced. Why would anyone refinance when his mortgage interest rates are less than 5%? Of course refis are going to stop. Even if rates hadn't risen, the refinancings would stop after the last American got a new loan.

[Petronski]

Most ARMs these days are 2/28s, not 3/27s, and they've been a hot item for several years now. Saying there won't be another round of refis for at least three years seems to presume all ARMs were 3/27s, and all were refinanced at the same time.

[Rocky]

Sounds like rubbish to me. How can you linking refinancing with furniture sales? I think he is trying to support a preconceived idea with whatever statistics he can manipulate.

[stylin19a]

30 year rates were up over 6.00 about a month or so ago.
Headline in todays local paper:

MIDWEST HOUSING SOARS
- September's numbers a 25 year high.

geez...things have to slow eventually

[Shanty Shaker]

Th laws of supply and demand would indicate that with a drop in demand for mortgages we will see even lower rates. Advice with large elements of basic economics missing should be looked at with a wary eye.

[arete]

Good article. Thanks for posting it.

Fannie is dragging the bottom of the river now by offering new home financing to low income no money down high risk buyers. In other words, you only qualify if you can prove that you can't afford the home. Hummm . . . yep, that is going to work out really well.

Richard W.

[DannyTN]

Why does the article assume higher mortgage rates?

[steve86]

Th laws of supply and demand would indicate that with a drop in demand for mortgages we will see even lower rates.

There are bigger factors at work. Mortgage rates can't trend down much while 10-year treasuries are headed up. Not for long, anyway. These are highly interrelated instruments.

[The Mayor]

17% was my rate in 1980, thankyou jimmy carter.

[Phaedrus]

Another yahoo who writes likes he knows what he talking about but doesn't.

[sourcery]

Why does the article assume higher mortgage rates?

Because very strong fundamental macroenomic forces are pushing rates higher. Examples: US trade deficits, US budget deficits.

Because interest rates cycle from high to low to high--and we've just passed the low point for this cycle. Rates have already reached historic lows. You thought such rates were here to stay, perhaps?

[Phaedrus]

Most ARMs these days are 2/28s, not 3/27s ...

"Yes" if you're a "Non-Conforming" borrower, "No" if your credit rating is good. Conforming borrowers will most often go for a 5/1 ARM (fixed for 5 years, variable annually thereafter) if they are willing to forego a fixed-rate mortgage, which most are not during this period of historically low rates.