Archives for November 2009

Current mortgage rates are headed lower and lower these days despite the fact that we are coming out of a recession and the Federal Reserve Open Market Committee will be raising interest rates in the coming year.

The government sponsored entity, Freddie Mac, released it’s mortgage rate survey showing 30 year mortgage interest rates near a record low and 15 year mortgage interest rates hitting a record low.

The average fixed 30-year mortgage rate was down to4.83 percent this week, with an average 0.7 discount points for the week ending November 12, 2009. Down from last week’s average mortgage interest rate of 4.91 percent. A year ago 30 year fixed rate mortgages averaged 6.04 percent.

Fixed 15-year mortgage rates averaged 4.32 percent this week, down from last week’s average home loan rate of 4.40 percent. Average mortgage discount points were 0.6 points. A year ago at this time, the 15-year FRM averaged 5.73 percent. 

Average five year Treasury-indexed hybrid adjustable rate mortgages averaged 4.25 percent this week, down from the prior week’s average of 4.35 percent.  Last year at this time the average 5-year adjustable mortgage interest rate was 5.87 percent. Mortgage points averaged 0.6 points.

One year U.S. Treasury indexed adjustable rate mortgages averaged 4.35 percent this week, , down from last week when it averaged 4.47 percent.  At this time last year, the 1-year ARM averaged 5.29 percent. Discount mortgage points average 0.6 points.

Freddie Mac’s vice president and chief economist had the following comments about the recent low mortgage interest rates.

“Interest rate on 30-year fixed-rate mortgage loans fell for the third consecutive week to the lowest since the week ending May 21^st, while 15-year fixed rates were the lowest since our records began in 1991,”. Low fixed rates throughout the third quarter prompted an estimated $1.1 trillion in refinancing activity, saving homeowners about $10 billion in aggregate monthly payments over the first 12 months of their new loan.  Moreover, for the fourth consecutive quarter, more than 95 percent of prime borrowers who originally had an ARM selected a conventional fixed-rate mortgage in the third quarter of this year.”

 “Meanwhile, new home building showed some weakness in recent months.  Residential construction eased 10.6 percent (annualized) between September and October, largely driven by a 33.3 percent decline in new condominium and apartment buildings and represented the slowest pace since records began in 1959.  And home builder confidence in November remained a relatively low level, according to the National Association of Home Builders.”

AIG Bank is offering some of the best CD rates available these days. AIG bank is the banking division of the insurance giant AIG. The insurance company had to be rescued by the U.S. government late last year.

The banking division is probably trying to build their cash reserves which is why its offering some of the highest cd rates available. Certificate of deposit accounts and all deposit accounts are insured by the FDIC.

The bank’s current six months certificate of deposit rate is 1.44 percent with an annual percentage yield of 1.45 percent, a rate that is one of the top cd rates around. The rate is also a lot higher than the national average 6 months CD Rate of 0.82 percent.

12 months certificate of deposits are currently earning a CD rate of 1.88 percent and an annual percentage yield of 1.90 percent. Average CD rates for a 12 month CD is at 1.104 percent as of today. Ally Bank is also offering a rate of 1.88 percent.

Other AIG Bank certificate of deposit rates include their 18 month CD with a rate of 1.93 percent and an APY of 1.95 percent. The 24 months certificate is earning a rate of 2.18 percent with an APY of 2.20 percent. The 36 months certificate of deposit rate is 2.47 percent and the APY is 2.50 percent. Five year CDs earn a rate of 3.00 percent and an APY of 2.05 percent.

AIG Bank Certificate of Deposit Rates

AIG Bank, the banking arm of the insurance company AIG, is offering some of the best money market rates available. Money market accounts are insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000 per depositor until December 31, 2013. After that date deposit insurance will revert back to the $100,000 limit.

AIG Bank’s money market rates are tiered, which means the rate of interest the account earns is scaled according to the amount invested in the account.  The higher the balance in the money market account, the higher the rate. 

Savings accounts and jumbo CDs typically earn higher rates with larger deposits and terms than accounts with smaller deposits and shorter terms. AIG Bank’s money market accounts with balances of $2,500 to $9,999 earn a rate of 1.09 percent and a yield of 1.10 percent.

Account balances between $10,000 and $49,999 earn a rate of 1.49 percent and an annual percentage yield of 1.50 percent. Balances between $50,000 and $99,999 earn a rate of 1.54 percent and a yield of 1.55 percent. 

Money market accounts with balances between $100,000 and $249,000 earn a rate of 1.60 percent and a yield of 1.60 percent. Account balances over $250,00 earn a rate of 1.64 percent and a yield of 1.65 percent.

Deposits are insured up to $250,000 so I would keep account balances under that limit. If you have more funds to deposit a better option for you is probably the Certificate of Deposit Account Registry Service (CDARS.com) which allows you to deposit up to $50 million and still receive FDIC insurance coverage.

AIG Bank also now also offering mortgages and the bank is currently  advertising a 30 year mortgage rate at 4.625 percent.

Citibank is offering some very competitive CD rates for a national bank. The bank is offering a special promotional 24 month certificate of deposit. The current annual rate is 1.73 percent and the current annual percentage yield (APY) is 1.75 percent.

Citibank’s 12 month certificate of deposit rate and yield are higher than the national average CD rate and CD yield. Citibank is currently offering a 12 month CD rate at 1.19 percent with an APY of 1.20 percent.

Other CD rates include a three month CD rate of .25 percent with an APY of .25 percent. Five month CD rate and yield of .50 percent. An eight month CD rate and yield of .60 percent. Five year certificate of deposit rates are currently at 2.71 percent.

As you probably are aware the government has come to the rescue of Citibank last year during the height of the credit crisis. The bank has participated in the government’s Trouble Asset Relief Program (TARP).

Despite the fact the Citibank was in trouble last year there is little risk that the government will let Citibank fail because “its to big to fail”. That being said even if the bank did fail deposit accounts are still insured by the Federal Deposit Insurance Corporation (FDIC).

Citibank also offers credit cards, mortgages and auto loans.

Citibank CD Rates

Freddie Mac announced today that 95% of borrowers who refinanced a mortgage in the third quarter of 2009 refinanced to a fixed-rate mortgage from an adjustable rate mortgage. 

Most refinancers choose a 30-year fixed-rate mortgages over all other mortgage types. 15-year fixed-rate mortgages gained in popularity among people who refinanced in the third quarter who previously held 30-year fixed-rate mortgage, balloon mortgages or an adjustable rate mortgage.

Home-owners are taking advantage of near record low mortgage interest rates and refinancing to fixed rate products from riskier adjustable rate mortgages. A smart move to refinance to fixed mortgages since mortgage rates are expected to head higher in the coming year.

“Low rates throughout all of 2009 have prompted about $1.1 trillion in refinancing activity this year, and we estimate that the borrowers who took advantage of refinancing opportunities in the first three quarters of the year will save about $10 billion in aggregate monthly payments over the first twelve months of their new loan,” said Frank Nothaft, vice president and chief economist for Freddie Mac.  “Over the first nine months of this year, the average interest rate offered by lenders on 30-year fixed-rate loans was 5.1 percent, on 15-year fixed-rate loans was 4.7 percent, and on 5/1 hybrid ARMs was 4.9 percent according to the Primary Mortgage Market Survey®.  Because interest rates across fixed- and adjustable-rate products are similar and fixed-rate loans provide the benefit of a certain principal-and-interest payment, most borrowers have chosen fixed-rate loans.

“For borrowers who can swing the higher payments that come with shorter term mortgages, the interest savings really add up.  The average fixed-rate refinance loan in the first three quarters of 2009 had a principal balance of about $225,000 and an initial interest rate of 6.25 percent.  By choosing another 30-year fixed-rate mortgage, a borrower could lower their monthly payment by $160 per month and would accumulate $3,200 in equity through principal payments over the first year.  In contrast, a borrower who chose a 15-year fixed-rate mortgage would have an even lower new interest rate but their monthly payment would rise by $350 per month; however, at the end of the first year they would have paid down $10,650 of the principal balance, thus building up home-equity wealth more quickly.”

Evantage Bank the internet banking division of Southwest State Bank of Sentinel, OK is offering a money market account they call “Mega Money Market” Account. This account has a one of the best money market account or savings account rates available today.

The current annual percentage yield for the money market account is 2.00%. The account also comes with a free MasterCard CheckCard, which is a debit card.  The money market account also has the following features.

• Monthly Statements are received electronically
• Includes 6 FREE withdrawals per month ($5 fee for each withdrawal after 5 per statement cycle).
• FREE Account (No Monthly Maintenance Fee)
• FREE Online Banking
• FREE Customer Service
• Overdraft Privilege available.
• NO MINIMUM BALANCE

Evantage Mega Money Market Account

Southwest State Bank is offering a rewards checking account that currently has an annual percentage yield of 4.00%. In case you’re not familiar with rewards checking accounts there is a certain number of transactions you have to do every month to receive the rewards checking rate.

If you fail to meet the requirements for a particular month the APY is a lot less than the advertised rate. Lean more here: Southwest State Bank Rewards Checking

Pacific Mercantile Bank is offering some of the highest CD rates available these days. The bank’s best CD deals are with 12 month certificate of deposits and 18 month certificate of deposit rates.

The current 12 month CD rate is 1.99 percent with an annual percentage yield of 2.o1 percent. This CD rate and CD yield is a lot higher than the current national average certificate of deposit rates of 1.12% APY for a 12 months CD and 1.29% APY for an 18 months certificate of deposit.

Pacific Mercantile Bank is also currently offering the following certificate of deposit rates and yields.

3 Month CD Rate 1.20% – APY- 1.21%
6 Month CD Rate 1.51% – APY 1.52%
24 Month CD Rate 2.12% – APY 2.14%
36 Month CD Rate 2.12% – APY 2.14%
60 Month CD Rate 2.12% – APY 2.14%

Pacific Mercantile Bank is headquartered in Costa Mesa, CA and has several bank branches in California. Deposit accounts are insured by the Federal Deposit Insurance Corporation (FDIC). The Bank’s FDIC Cert number is 34950.

Pacific Mercantile Bank CD Rates

Discover Bank is offering a $25 CD account bonus for opening a certificate of deposit with a term of 12 months or longer. There is also aminimum opening CD account deposit of $10,000 to receive the $25 bonus.

The certificate of deposit $25 promotional bonus offer is valid until December 15, 2009. There is a limit of one offer per customer. Be sure to use offer code D120336 to receive the promo bonus.

The money you open the CD account with also must remain in the CD for at least 90 days to receive the bonus. Of course you will not want to incur any early withdrawal penalties even if you pass the 90 day grace period for the bonus.

The bank also offers very competitive 12 month CD rates and CD yields . The current 12 month certificate of deposit rate is 1.88 percent and the annual percentage yield (APY) is 1.90 percent. The bank also offers a 24 month certificate of deposit rate of 2.23 percent and an APY of 2.25 percent.

Discover Bank $25 Promotional Bonus offer

The House and Senate has voted to extend the first time home buyer credit that was going to expire on November 30, 2009. President Obama is expected to sign the bill into law sometime today.

The $8,000 credit for first time home-buyers, which includes anyone who hasn’t owned a home in the past three years, has been extended to April 30, 2010. In order to receive the credit you must sign a sales contract by April 30 and close on the home by June 30, 2010.

The National Association of Realtors lobbied successfully to have the credit expanded to include other home owners to help fuel home sales. The credit has been expanded to include a $6,500 tax credit for anyone who is buying a home that has owned the current home for at least five years.

The renewed and expanded tax credit along with current low mortgage rates gives potential home buyers a powerful incentive to purchase a home. Hopefully the housing market will continue on the path to recovery. Many people in the industry were worried about housing market after the credit expired in November.

The tax credit doesn’t include vacation homes and is only for a home purchase that will be your primary residence and costs $800,000 or less.The credit is also phased out for individuals with annual incomes above $125,000 and for joint filers with incomes above $225,000.

If you’re in the military serving outside the United States for at least 90 days, the tax credit is extended for another year.

Bank of The Sierra is offering a rewards checking account yield that tops all savings account rates these days, which is why I am writing about it under our savings account category. Like all high yield rewards accounts there is a certain number of monthly transactions that have to be completed to receive the reward rate.

The rewards annual percentage yield of 4.51% is for checking account balances under $25,000. Checking account balances over $25,000 earn an annual percentage yield of 1.01 percent. If you do not meet the monthly qualifications for a given month the APY is only .12%. The good news is if you don’t meet the qualifications for one month you can get back to the rewards rate the following month.

Another good deal with these types of accounts is they will reimburse you up to $25 per month for ATM fees so you can open a high yield rewards checking accounts with a bank that doesn’t have any bank branches near you. The potential bad news is the current APY can change at anytime but usually doesn’t. 

Monthly Rewards Checking Account Qualifications

• Minimum 12 Sierra Check Card purchases per statement cycle
• Minimum one direct deposit or automatic payment from your account per statement cycle
• Make at least one bill payment online per statement cycle
• Receive eStatements
• Must be opened online

Bank of The Sierra Rewards Checking Account

UmbrellaBank, a division of New South Federal Savings Bank of Birmingham, AL, is offering one of the highest bank CD rates available these days for a 12 months certificate of deposit.

The current CD rate is 2.176 percent and the current annual percentage yield is 2.20 percent. The CD rate is almost double the current national average CD rate of 1.13 percent.

The minimum opening certificate of deposit account balance is $1,000. You can transfer interest you earn on your certificate of deposit to an UmbrellaBank Checking Account, Money Market Account or Savings account.

Deposit accounts at UmbrellaBank.com are insured for up to $250,000 by the Federal Deposit Insurance Corporation (FDIC) under the parent company’s FDIC Cert number of 32276. UmbrellaBank.com also offers credit card, retirement accounts and mortgages under the parent company.

UmbrellaBank.com

newdominionDIRECT.com of Charlotte, NC is offering a 6 month CD rate of 1.60 percent with an annual percentage yield of 1.62 percent, one of the highest 6 month CD rates and CD yields around.

If you’re looking for a longer term certificate of deposit newdominionDIRECT.com is also offering a three year certificate of deposit yield of 2.71 percent, one of the best CD rates around and higher then most five year certificate of deposit rates at banks.

The minimum opening deposit for all certificate of deposit accounts at newdominionDIRECT.com is $3,000. Interestis compounded daily which will give you a higher APY than a certificate of deposit that has interest compouned monthly.

All deposit accounts at newdominionDIRECT.com are insured by the Federal Deposit Insurance Corporation for up to $250,000. The bank’s FDIC Cert number is 57888.

newdominionDIRECT.com Certificate of Deposit Information here: CD Information

Current mortgage interest rates have been hovering just above 5.00 percent for a fixed rate 30 year mortgage. Current 15 year mortgage interest rates are just below 4.50 percent.

This past Thursday Freddie Mac released their weekly Primary Mortgage Market Survey that showed a small uptick in longer term mortgage interest rates.

In the most recent PMMS survey fixed rate 30 year mortgages were at 5.03 percent for the week ending October 29, 2009, up from last week when the average mortgage interest rate was 5.00 percent. 30 year home loan rates were above 6.00 percent a year ago at 6.46 percent. Interest rates are still low historically speaking so if you’re looking to buy or refinance an existing mortgage you should go ahead and do it.

Average 15 year fixed mortgage interest rates are 4.46 percent this week, up from last week when the average mortgage rate was 4.43 percent. A year ago at this time 15 year home loan rates were also above 6.00 percent at 6.19 percent.

Adjustable mortgage rates were also higher this week over last week, current Treasury indexed five year mortgage rates are at 4.42 percent, up from last week’s average loan rate of 4.40 percent. A year ago at this time 5 year mortgage rates were at 6.36 percent. One year mortgage rates are currently at 4.57 percent, up from last week’s average mortgage loan rate of 4.54 percent.

Frank Nothaft, Freddie Mac vice president and chief economist had the following comments about mortgage interest rates in this week’s survey.

Interest rates for 30-year fixed mortgages have averaged just below 5 percent this year, which is the lowest 10-month average since the survey began in 1971. As a result, refinance activity has accounted for almost seven out of 10 mortgage applications on average this year, according to Freddie Mac’s survey.

Economic data releases this week offered mixed signals as to the current state of the housing market. For example, total existing home sales jumped 9.4 percent to an annualized rate of 5.57 million homes in September, the strongest pace since July 2007, according to the National Association of Realtors®.

However, new home sales unexpectedly fell 3.6 percent to 402,000 houses, the weakest since June of this year, based on figures from the Department of Commerce. Nonetheless, stronger housing demand has lowered the inventory of unsold existing homes in September to the lowest since January of this year and for new homes the lowest since November 1982, which should help stabilize falling house prices.