Freddie Mac reported that mortgage rates are at the highest theyâ€™ve been in two years. Thirty- year home loans are being offered at an average of 4.58%, which is up from last weekâ€™s average of 4.4%. This is the highest rate Freddie Mac has reported in over two years.
The popular alternative to a thirty-year fixed loan, the fifteen-year fixed loan, was also up to 3.6%, from last weekâ€™s 3.44% and last yearâ€™s 2.89%.
These rate jumps have had their impacts. Wells Fargo, the number one mortgage lender, is cutting nearly 2,300 of itâ€™s employees within the next two months blaming it on that fact that there is way less demand for refinancing, as compared to last year. Also, there are fewer foreclosures and delinquencies than last year.
A Wells Fargo representative said the layoff impact in the greater Los Angeles area would mostly be in Orange County and in San Bernardino. Minor layoffs will take place in San Diego.
Wells Fargo isnâ€™t the only major lender handing out pink slips. The number two mortgage lender, JP Morgan Chase & Co., recently reported that they are going to eliminate three thousand mortgage related jobs.
Itâ€™s reported that the Federal Reserve as been buying up to eighty-five billion a month in mortgage backed securities and Treasury Bonds. Mortgage rates are rising and investors are expecting the Federal Reserve to start cutting back on their stimulus program later this year.
According to the minutes of the Federal Reserveâ€™s last policy meeting on Wednesday, no consensus as to when to scale back the bond purchases had not been made. However, some analysts believe the first cut will happen in September.
With the rates going up, there has been a slight increase in the fence sitters jumping into the market. But the increase in those homebuyers has not made up for the decline in refinancing.
If youâ€™re interested in purchasingÂ Malibu Real EstateÂ before the mortgage rates go any higher,Â contact our office,Â 4 Malibu Real Estate, at 310.456.3655 or visit our website at:http://www.4Malibu.com.
As reported in Seen in LA Times, by E. Scott Reckard.