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Adjustable Rate Mortgages

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BUSINESS
January 20, 2002
The adjustable-rate mortgage market slid to a three-year low in popularity last year as homebuyers preferred fixed-rate mortgages with interest rates at 30-year lows, according to an annual survey by Freddie Mac. Adjustable-rate mortgages grabbed only 12 percent of the mortgage market in 2001, down from 21 percent in 2000, according to the survey. The 12 percent is the lowest share since 1998's 11 percent share, which was an all-time low. ARMs were first offered in the early 1980s. Homebuyers did not find the spread between adjustable-rate mortgages and fixed-rate mortgages advantageous since, according to Freddie Mac, the initial rate for a one-year ARM was 5.27 percent compared with fixed rates that hovered between 6.5 percent and 7 percent by the end of last year.
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NEWS
June 18, 2012
All too often, I hear that President Barack Obama inherited this economic mess that we're in right now. Let's get the story straight for a change. He helped create this mess. In 2005, President Bush tried to push legislation through Congress to place regulations on Fannie Mae and Freddie Mac. Mr. Bush knew that these organizations' policies involving the lending of mortgage money to those that couldn't afford it were going to cripple the economy if not regulated. It was the efforts of Democratic Sen. Christopher Dodd and Democratic Rep. Barney Frank, accompanied by Sen. Barack Obama, that were successful in blocking these regulations by threatening to filibuster.
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BUSINESS
By KENNETH HARNEY | May 27, 2001
IN THE wake of the Federal Reserve's latest interest rate move, the mortgage market has an unlikely new wrinkle that you shouldn't ignore. For the first time in many months, some of the most attractive deals for homebuyers and those refinancing can be found in adjustable-rate loans rather than fixed-rate mortgages. In the days immediately after the Fed's half a percentage point rate cut, fixed-rate 30-year home loans actually rose slightly in price while adjustable-rate mortgages declined.
BUSINESS
By Jamie Smith Hopkins and Jamie Smith Hopkins,jamie.smith.hopkins@baltsun.com | August 21, 2009
One in eight Maryland borrowers were behind on their mortgages this spring, a new report shows, a record caused by job losses and foreclosures feeding on each other in a vicious cycle. That adds up to about 132,000 homeowners who were at least 30 days late, according to a survey released Thursday by the Mortgage Bankers Association. That's up nearly 60 percent from a year ago and includes people whose lenders were trying to foreclose as of June. The country fell into recession after homeowners with risky "subprime" loans began defaulting in large numbers two years ago, sending financial institutions into a tailspin.
BUSINESS
By Phil Roosevelt and Phil Roosevelt,American Banker | April 12, 1992
NEW YORK -- Adjustable-rate mortgages, deeply out of favor with consumers for the past year, are staging a comeback.The loans, which typically carry lower initial rates than fixed mortgages, are catching the eye of first-time homebuyers as the springtime market gets under way, lenders and analysts say.The trend has been reinforced by a steady rise in fixed rates since mid-January.Gary Gordon, a thrift analyst at PaineWebber Inc., estimates that adjustables will account for 30 percent to 40 percent of all new mortgages by late summer, up from the 15 percent reported for February by the Federal Housing Finance Board.
BUSINESS
By BLOOMBERG NEWS | August 28, 2005
U.S. mortgage applications declined for a fourth week in five as an index measuring home purchases fell by the most since early July. The Mortgage Bankers Association said Wednesday that its gauge of purchase and refinancing applications dropped 0.7 percent to 756.2 in the week ending Aug. 19 from 761.3. Purchase applications decreased to 488.4, a 2.2 percent fall that was the biggest since the week ending July 8. Mortgage rates "are still at levels that are conducive to home sales," said Bob Walters, chief economist at Quicken Loans Inc. "We're just seeing a strong desire for real estate."
BUSINESS
December 15, 2002
WASHINGTON - Mortgage rates around the country fell last week for the first time since the middle of last month. The average interest rate on 30-year fixed-rate mortgages dropped to 6.04 percent for the week ending Friday, Freddie Mac reported Thursday in its weekly nationwide survey. That was down from 6.19 percent the previous week. Last week's rates marked the first time rates on 30-year, 15-year and one-year adjustable-rate mortgages fell since the week ending Nov. 15. At that time, rates on 30-year mortgages dropped to 5.94 percent, the lowest level since the mortgage giant began tracking them in 1971.
BUSINESS
By Bloomberg News Service | March 22, 1992
WASHINGTON -- Reflecting rising interest rates, the U.S. mortgage application index decreased to a seasonally adjusted 193.5 in the week ending March 13, the Mortgage Bankers Association of America said last week.The index, which rose to 204.7 during the previous week, tracks the pace of applications for mortgages and refinancing, both ofwhich increased after rates fell to the lowestlevels since the 1970s.The index for home purchases decreased to a seasonally adjusted 131.2 from 133.4 in the latest reporting week, the mortgage bankers association said.
BUSINESS
June 18, 1992
Maryland Federal BancorpThe Hyattsville-based parent of Maryland Federal Savings and Loan Association reported record profits in its first fiscal quarter, which ended May 31, as improving residential real estate markets helped heat up demand for mortgage loans.The company also said demand was increasing for adjustable-rate mortgages and for mortgage refinancings.Maryland Federal has 19 offices in Prince George's, Montgomery, Charles and Anne Arundel counties.Three months ended 5/31/92.. .. .. .. ..Income .. .. .. ..Share'92 .. .. .. 1,998,000 .. .. ..0.69.
BUSINESS
November 19, 1995
ARM holders move to low fixed ratesHomeowners with adjustable-rate mortgages (ARMs) are taking advantage of low interest rates to refinance with fixed-rate loans, according to a Freddie Mac study.According to the survey, just 11 percent of refinancing borrowers with ARMs applied for new adjustable-rate mortgages in the third quarter, the lowest rate since the end of 1991. The rate was 22 percent in the second quarter and 29 percent in the first quarter.A year ago, 30-year fixed-rate mortgages averaged 9.19 percent nationally in Freddie Mac's Primary Mortgage Market Survey.
NEWS
By Eileen Ambrose and Eileen Ambrose,eileen.ambrose@baltsun.com | December 17, 2008
Federal Reserve policymakers dropped a key interest rate to the lowest level in history yesterday, but many consumers might well ask: What rate cut? The Fed action could help those with home equity lines of credit and, indirectly, give needed relief to homeowners whose adjustable-rate mortgages are poised to reset. But for many other types of consumer credit, from auto loans to credit cards, the rate cut might not translate to significant monthly savings. Many rates were low already. And at a time when lenders are more averse to risk and tightening credit standards, they probably won't pass a rate cut on to customers.
BUSINESS
By KEN HARNEY | May 4, 2008
Like a spreading infection, restrictions on credit are moving into new and more specialized niches of the mortgage market. The latest to feel the pinch: Cash-out refinancings. Loans with anything less than full documentation of borrower income, credit and assets. Mortgages for certain second-home purchases. Investment-loan applications where the buyer already owns at least three other rental properties. Mortgages to borrowers with "nontraditional" credit. Short-term construction loans that convert to permanent mortgages.
BUSINESS
April 22, 2008
WASHINGTON - Interest rates on short-term Treasury securities rose in yesterday's auction, with six-month bills rising to their highest levels since early March. The Treasury Department auctioned $20 billion in three-month bills at a discount rate of 1.320 percent, up from 1.060 percent last week, and $20 billion in six-month bills was auctioned at a discount rate of 1.680 percent, up from 1.380 percent last week. The three-month rate was the highest since the bills averaged 1.450 percent on April 7. The six-month rate was the highest since the bills averaged 1.810 percent on March 3. The discount rates reflect that the bills sell for less than face value.
NEWS
September 3, 2007
There's little fine print in President Bush's plan to help Americans with subprime mortgage woes. He's offering a way for overextended borrowers to try and meet their rising mortgage payments and avoid foreclosure. It's about time. After initially shrugging off the potential fallout of the subprime mess, Mr. Bush has realized that keeping more Americans in their homes is good for the economy and that the federal government has a role to play. At the center of the president's modest package is a proposed change in the Federal Housing Administration's mortgage insurance program that would enable homeowners struggling with the higher costs of adjustable rate mortgages to refinance with federally insured loans.
NEWS
By Laura Smitherman and Laura Smitherman,sun reporter | August 24, 2007
Adjustable rate mortgages have always meant that homeowners are taking a chance that payments could fluctuate along with interest rates, but in recent years some loans have been structured to virtually guarantee that rates go up - and stay up. While many homeowners are feeling the pinch of rates resetting on so-called ARMs, some are getting crushed by what housing advocates call "strangulation ARMs" that continue to reset as often as every six months....
BUSINESS
By Hanah Cho and Andrea K. Walker and Hanah Cho and Andrea K. Walker,SUN REPORTERS | August 19, 2007
Don't wait until you become delinquent on your mortgage payments or are facing foreclosure before seeking help. That's the key advice from housing counselors in the Baltimore area, who are trying to get struggling homeowners out from under ballooning mortgage payments. "The moment they're falling behind, or think they're falling behind, call us immediately," said Ashidda Khalil, director of the Baltimore office of the Neighborhood Assistance Corp. of America, a nonprofit housing advocacy group.
BUSINESS
By BLOOMBERG NEWS | February 20, 2005
Freddie Mac, the second-biggest provider of financing for U.S. housing, said that it will expand its interest-only payment option to more adjustable-rate home loans to meet demand from borrowers. The 10-year interest-only period will be allowed with hybrid adjustable-rate mortgages that have fixed rates of interest for set terms of three, five, or seven years, Freddie Mac said Thursday. Freddie Mac already allows the 10-year interest only period on hybrid adjustable-rate mortgages with a fixed rate of interest for 10 years.
BUSINESS
By BLOOMBERG NEWS | February 17, 2000
WASHINGTON -- U.S. starts of home construction unexpectedly increased last month and permits for new projects climbed to the highest level in a year, suggesting that builders will stay busy in the months ahead even as interest rates rise. Housing starts rose 1.5 percent last month to a seasonally adjusted annual rate of 1.775 million units after jumping 5.1 percent in December, the Commerce Department said yesterday. January's increase was paced by a 17.7 percent surge in starts of apartment buildings and other multifamily projects.
BUSINESS
By Marilyn Geewax and Marilyn Geewax,Cox News Service | May 23, 2007
WASHINGTON -- The bad apples did it. The subprime mortgage market was spoiled by bad guys who tried to make a quick buck in an otherwise reputable business, John Robbins, president of the Mortgage Bankers Association, said yesterday. "It's not just our reputations that have been damaged. People have been hurt ... all because of a very few unethical actors," Robbins said in a speech at the National Press Club, where he called for tougher licensing standards. "Frankly, it's too easy to hang a shingle and call yourself an expert in mortgages," said Robbins, whose trade group represents the real estate finance industry.
BUSINESS
By Kenneth Harney and Kenneth Harney,Earthlink | January 12, 2007
So is it finally a farewell to ARMs - the once-ubiquitous adjustable-rate mortgages? You might think so with fixed-rate loans priced just slightly above one-year Treasury-indexed adjustable rate mortgages. After all, why bother with an ARM at 5.8 percent - the average contract rate at the end of December, according to the Mortgage Bankers Association of America - when you could get a 15-year fixed-rate loan at 5.9 percent, or 30-year fixed-rate mortgage at 6.2 percent, all with roughly the same origination fees?
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