Low mortgage rates the silver lining in a bleak housing picture

Sure, the shakiness in the mortgage lending market has made it difficult for some borrowers to get a loan. But for others with great credit and a down payment, conditions are getting even more favorable to buy a home or refinance.

If there’s one little bright spot among all the gloomy housing data these days, it may be this: Mortgage rates for conforming loans — those under the $417,000 cap on Fannie Mae and Freddie Mac purchases — are still relatively low.

According to the Freddie Mac survey released on Thursday, the average interest rate on the 30-year fixed-rate mortgage was 6.31%, down from 6.46% last week and the 6.43% it averaged at the same time a year ago. See full story.

In mid-July, the 30-year mortgage averaged 6.73%, according to Freddie Mac. Go back further in history, and rates were in the double digits at points in the 1980s and 1990s. View Freddie Mac’s historical rate chart.

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The reverse mortgage market has continued its breakneck growth in Australia as a growing number of cash-strapped seniors begin to warm up to the controversial home loan product.

Reverse mortgages, which allow borrowers aged 55 years or more to borrow cash against the value of their home, have been mostly used for short-term purposes, such as to fund accommodation bonds, sea or tree change trials or as bridging finance, the study found.

According to the latest SEQUAL/Trowbridge Deloitte Reverse Mortgage Study, the reverse mortgage market has jumped by $274m in the six months ending June – a 24% increase to more than $1.8bn. Over the past 12 months, the market expanded by 67%.

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The European Commission called on insurers to justify or overhaul two practices it said create antitrust problems for the continent’s insurance industry.

The commission, the European Union’s executive arm, targeted the longstanding practice of aligning premiums for large risk contracts, which it said could lead to higher prices. It also raised questions about what it called unhealthy conflicts of interest by insurance brokers, which it said might inflate prices and reduce choice.

“The commission is serious about making markets work better, even where that means we need to question some established market practices,” said Competition Commissioner Neelie Kroes. The industry needs “to reform relevant business practices,” she added.

The commission didn’t give the industry any deadline for justifying the practices or making changes.

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If you don’t want to give a continuous monthly payment for your house and want to save money, you can do it by refinancing your home. If you get a refinance mortgage loan you can easily save your money without paying monthly payments. Under a mortgage refinance plan, your present deal is reinstated with a different deal. It supplies its borrowers with many benefits. It decreases the house payment and releases some of the equity built in a lump sum payment or installments.

Mortgage refinance refers to changing the current loan with some other loan. It is capable of giving a positive edge if your credit history is not up to the mark. Your personal lender must be knowledgeable of your history and can suggest you favorable terms of refinance mortgage loan.

There are various types of refinance mortgage loan which you can find in the market. Through these loans you can refinance your mortgage.

1. Fixed Rate: Here, the interest rate on the base amount is fixed through out the years of the payment of the loan.

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The reverse mortgage market continued its exponential growth last financial year, but housing market downturns, especially in NSW, tempered the surge, according to the latest SEQUAL/Trowbridge Deloitte Reverse Mortgage Market Study.

Reverse mortgage numbers grew by 67 per cent in the twelve months to June 30 this year, with $520 million in new loans, or ‘settlements’. However, growth slowed in the second half of the financial year to only 20 per cent.

Kieren Dell, SEQUAL’s executive director, said this downturn came largely from the malaise in the NSW housing market. While still the largest segment, the NSW share of the reverse mortgage market dropped from 41 per cent last financial year to 32 per cent this year on the back of sluggish housing growth.

While Victoria, Queensland and Western Australia all recorded strong growth, the drop in “powerhouse driver” NSW had a lasting effect, he said.

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Although Wall Street has been exuberant for the past two days about the Federal Reserve’s decision to cut a key interest rate, the reaction on Main Street has been more muted.

Mortgage and real estate brokers say that the Fed’s decision will help some homeowners pay off their bills instead of going into foreclosure. In addition, a congressional initiative to ease lending restrictions at the Federal Housing Administration may bring buyers to the market.

But most say that the interest rate cuts and legislative reforms will not immediately revive the real estate market. Instead, home prices and sales will stagnate or decline deep into next year, with no recovery until late 2008 or early 2009, they say.

That’s not much different from what people were predicting before the Fed made its cut.

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AUGUSTA, Maine — Like other driving instructors across Maine, Dwight Hawkins has a new lesson to add to his course this fall: If you’re under 18 and behind the wheel, lose the cell phone.

As of Thursday, a new Maine law will prohibit anyone less than 18 years old from driving while using a mobile phone or handheld electronic device. The law sets a $50 fine for the first violation and $250 for second or subsequent offenses.

Scores of laws affecting motorists, businesses, consumers, students and others take effect Sept. 20, which marks the 90th day after June’s adjournment of the 2007 legislative session.

Hawkins, whose Area Driving School Inc. has 10 locations in central Maine, said he’s been teaching young drivers about the dangers of distractions such as eating, fixing hair and typing on laptops. He’s also telling them about the new cell phone restriction.

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Applications for home mortgages climbed for a third straight week as more borrowers sought to refinance loans on which payments may be about to rise, an industry group said Wednesday.

The seasonally adjusted index of applications for home refinancings jumped 4.6% to 1,962, the highest level since May 18, the MBA said. The MBA gauge for home purchase applications edged 0.9% higher to 452.0.

The indexes underscore a growing urgency of homeowners with 5 million adjustable-rate mortgages slated to reset at higher rates over the next 18 months.

Concern that resets will boost delinquencies and foreclosures has risen as lenders eliminate programs that once accepted riskier borrowers, and increase requirements for consumers with good credit.

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It used to be you went to online real estate sites in search of pictures and information about homes for sale. Then came virtual tours, aerial maps, and easy access to data about comparable sales. Now comes a slew of sites encouraging you to chat about real estate online.

New sites encourage visitors to bring the real estate conversations they have with their office-cube mates or drinking buddies to the Internet, allowing them to pose questions to strangers about housing values in a specific part of the country, or debate the merits of a certain street in San Jose.

“Americans are obsessed with real estate, whether they own it, aspire to own it or are remodeling it,” said Brian Boero of 1000 Watt Consulting, an Oakland company that works with both real estate firms and companies trying to create online communities. So sites like Trulia and Zillow, which both feature real estate content enhanced by users’ questions, answers and discussions, are trying to take that public fascination and channel it into a new medium.

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This is a bandwagon employers might want to think twice about before jumping on.

Some companies nationwide are tackling health-care costs by charging obese employees higher premiums. But local experts, including attorneys who represent employers, have poohpoohed the approach because they believe the solution could be worse than the problem.

Commack attorney Allen Breslow said that the weight- differential costs could violate obese employees’ rights. “I have serious questions about whether that is an appropriate way to treat a medical problem,” he said. “It might be an ADA [Americans With Disabilities Act],” violation … I just wouldn’t let my clients touch it.”

In fact, an attorney for the U.S. Equal Employment Opportunity Commission, which enforces the ADA, echoed that concern, especially regarding the morbidly obese, generally considered to be individuals at least 100 pounds overweight.

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