Seattle Mortgage Planner

USDA loans offer 100% financing for people with less than perfect credit. There is no mortgage insurance--there are income limits and the property must be located in a rural area. For more information, you can read this post from my nationally recognized blog. - Sat Jun 6 2009, 18:01

Gina,
a lot is going to depend on why your credit score is low. Were you approved for a conventional 100% financing such as a Flex 100? Some pmi companies are now calling areas in Pierce county as "soft" and that may have zinged you as well.

FHA does sound like your best bet. And FHA is not going by "soft markets". - Wed Mar 12 2008, 22:11

Plus waiting while your home depreciates means that you'll have mortgage insurance. :( Sorry...I'm feeling like a real bummer. - Thu Feb 5 2009, 15:25

There are issues with waiting for the gov. to lower rates. To begin with the Fed is doing this buy purchasing mortgage backed securities (bonds) at specific rates. Mortgage rates (at this time) are not directly controlled by the gov. Year to date, I believe the Fed has all ready purchased $92B in mortgage backed securities, yet we're hanging around 5% (depending on credit score, ltv, etc). Other factors are influencing current rates. I've written more about it in the link below. I also invite you see what rates I'm quoting "live" to real consumers at http://www.twitter.com/mortgageporter (please disregard the rates posted in the link below as they are from January 23). - Thu Feb 5 2009, 14:07

Carl, I highly recommend selecting a local Mortgage Professional who will watch rates for you. What I'm offering my clients in Washington State who are waiting for "under 5%" is to begin the application process so that we have everything we need in order to lock when the rate is available.

When the rates dip into the 'below 5' range, many LO's become inundated and are not able to handle all the request from potential borrowers. They have to tend to those who are committed to them first (often with a forward lock agreement) and will contact "rate shoppers" next.

Another factor is that the actual banks/lenders will become too busy to handle the rates and they will either shut down their lock desk or "artifically" increase rates in order to slow down new locks.

The industry has fewer people to handle all the request...last week, I heard a stat from the Washington Association of Mortgage Professionals that we have gone from 14,000 licensed loan originators in Washington State to 4,000 in two years!

Be sure to consider what your current rate is, what rate you need to break even on closing costs and how long you plan to retain your current home.

Good luck! - Thu Feb 5 2009, 13:25

I enjoyed living in Des Moines a few years ago. I had a condo on 6th so I was near the water. Des Moines is a great town and it felt like I was in 'center" of everything with many freeways nearby. You do have a lot of choices to consider! "Old Burien" is also pretty cool and both Des Moines and Burien will be more affordable than anything "in" Seattle.

I would visit various areas at different times of the day to see how they feel--kind of try them on! - Thu Feb 5 2009, 13:29

Jim, I provide rate quotes via Twitter. You can see what I'm quoting other clients live by visiting the link below. At the very least, it can give you an idea of what direction rates are heading.

In this market, many loan originators may not have time to provide a daily email. Not only are we in a "refi boom" but there are fewer of us around to serve clients.

Other things to keep in mind is that currently, people who are receiving a 4.5% rate have a significant amount of home equity (40% home equity or 60% LTV); 740 or better credit scores and they have provided a mortgage professional with a complete loan application and permission to lock. Often times when rates have been low enough to lock those who qualify for 4.5%, we only have an hour or so before the rate has adjusted and it's gone. By the time you receive an email and respond, the rate may be gone. - Mon Jan 19 2009, 17:22

Rgr,
4.5% was leaked by the media and heavily pushed by groups who may benefit for purchase mortgages at 4.5%. It's artificial.

With the gov. buying mortgage backed securities (which mortgage rates are based on) rates have dipped down. They were around 4.5% for a whole 2 hours and zipped right back up. Only the most prime borrowers who were ready to lock were able to obtain the lowest rate in years. Those who had to sit and think about it missed out just because of how quickly the rates changed. Those who weren't prepared by pre-applying or pre-locking with their LO missed out. LO's did not have time to contact their clients to see if they wanted the "it" rate...if they did, by the time they replied...it was gone.

So, yes Rgr, there was a 4.5% (I'm tempted to say "Yes...there is a Santa Claus")...could there be again? Maybe...but it's not guaranteed.

If you have no closing costs and you're dropping your rate over a point--lock it and count yourself lucky. You're breaking even on closing costs right away and when/if rates improve to 4.5% or who knows what, it's no skin off your nose to refi again. - Mon Dec 29 2008, 20:06