What did todays rate cut mean??

Today’s prime rate cut of .75% means that mortgage rates are going to continue to drop even lower,.. Right? Not Necessarily!!!

As much as I hope that rates continue to drop for homeowners, this rate cut does not mean that the 30 year rates will go down immediately. Rates have actually dropped significantly over the last 3 weeks on the assumption that the Feds were going to drop the Prime rate at least .50% (and some speculated that it might be as high as 1%). Had the Feds only dropped the rate .25% today, rates would actually have gone up today due to the over speculation from the previous weeks.

Please note that 30-year fixed rates correlate directly to long term bond yields, not the Prime rate. Thus, the outlook for the future of our economy is the most important factor in what 30 year rates do today,.. And unfortunately that is very subjective.

SO WHAT DOES THAT MEAN TO YOU??

The good news is that rates are as good as they have ever been in the last 6 years. If you need to refinance out of an ARM do it now. In fact, my advice for the last 6 years has been pretty consistent, regardless of the market. IF IT MAKES SENSE TO REFINANCE OR PURCHASE TODAY – DO IT. These markets are very difficult to predict, and loan programs are changing (for the worse) every day. I would rather you Ieave .125% on the table by refinancing now, than losing .25% by waiting too long, or worse… losing your ability to refinance.

Arm yourself with knowledge!

Jim

JIM CUNNINGHAM
Community First Financial, LLC
7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8900 ext 305 - office
480-907-2435 - fax
602-434-8261 - cell
jcunningham@communityfirstfinancial.com
www.communityfirstfinancial.com
www.jimcunninghamcff.blogspot.com
http://activerain.com/jcunningham

The Next Refinance Boom is Here

THE GOOD NEWS ABOUT RATES!!

Despite all of the recent well reported real estate related woes, I have great news for everybody. RATES ARE DOWN! And truth be told, rates are actually way down. Rates are currently better than anything we have seen in the last 3 years, and by the time you read this, they could be at an all time low for the last 10+ years!

The reason they are so good today is really difficult to pinpoint. There are really dozens of reasons, but my market advisors are saying that these low rates are influenced from the speculation that the Fed will continue to lower prime (which is a good guess).

Here are my rates on Jan 15th. These rates assume that you are a perfect borrower*. If you are not that perfect borrower – rates are still very good.

30 year fixed 5.625% (no points)
15 year fixed 5.000% (no points)
5 year ARM 5.375% (interest only) (no points)
5 year ARM 4.875% (interest only) – (paying one point)

Please give me a call (or email) to explore if this is a good time to refinance. Aside from the many that will refinance during this rate spike, this is a fantastic time to purchase investment property.

All Best!!

Jim

*Perfect borrower is generally someone with a 700+ credit score and can document their income (tax returns/paystubs) and reserves (bank statement/401K). Also, the perfect borrower will have a 20%+ equity position in their home.

JIM CUNNINGHAM
Community First Financial, LLC
7575 E Redfield Rd Suite 235
Scottsdale, AZ 85260
480-305-8900 ext 305 - office
480-907-2435 - fax
602-434-8261 - cell
jcunningham@communityfirstfinancial.com
http://www.communityfirstfinancial.com/
http://www.jimcunninghamcff.blogspot.com/
http://activerain.com/jcunningham