Fed Drops Rates Sunday Night! - Week in Review: March 10-16

This blog is a little late...that’s because I had word of late-breaking news!

JP Morgan Chase to buy Bear Stearns for $2/share. (CNNMoney, 3/16)

The US Federal Reserve cut to its lending rate Sunday night to financial institutions to 3.25% from 3.50% and created another lending facility for big investment banks to secure short-term loans. (CNBC, 3/16)

Feds propose home-loan disclosure reform - President Bush on Friday is expected to announce a plan aimed at making the mortgage application process easier for prospective buyers and lowing closing costs. Require new disclosures by summer in the buying and selling of homes. (AP, 3/14)

Foreclosures up 60% in February - The number of filings jumps year over year but decreases modestly over last month. (CNNMoney, 3/12)

Mortgage Application Fees Rise on appraisal reform - A new agreement between the NY Attorney General and Fannie and Freddie should promote independence and accuracy of appraisals. But it's going to cost buyers. (CNNMoney, 3/12)

US to simplify mortgage process - Buyers would get easier-to-understand mortgage terms and save about $700 in closing costs under a new proposal. (CNNMoney, 3/14)

Mortgage Applications Fall - Volume dropped 1.9% in the week ending March 7. Refinance volume dropped 4.7% while purchase volume increased 1.6%. Refinance applications accounted for 50.6% of total applications. Refinance volume has steadily declined since January, when it accounted for 73% of total applications. (CNNMoney, 3/13)

Mortgage Rates Rise – Mortgage rates rose across the board this week as lower home prices and mortgage rates contributed to a more affordable market for homebuyers. The government-sponsored loan buyer said 30-year fixed-rate loans averaged 6.13% for the week ending Thursday, up from 6.03% last week. Freddie Mac also said 15-year fixed-rate loans averaged 5.60%. Rates on five-year adjustable-rate mortgages (ARMs) averaged 5.58%, up from 5.34% last week. One-year Treasury-indexed ARMs averaged 5.14%, up from 4.94% last week. (CNNMoney, 3/13)

January Pending Home Sales Index Unchanged in December – contrary to consensus expectation of 1% slide. (CNNMoney, 3/13)

Calirfornia February Sales up 7.1% - A total of 20,513 new and resale houses and condos were sold statewide last month. That makes it the slowest February in DataQuick's records, which go back to 1988. Sales were up 7.1 percent from 19,145 in January and down 34.3 percent from 31,228 for February last year. (DQNews, 3/14)

Commercial real estate market fundamentals are fairly stable, although investment is waning following a record year in 2007. (NAR, 3/12)

Fed is poised to cut interest rates further, by possibly as much as 75-basis points when they meet later this month, says Economist Danielle Hale. (NAR 3/14)


Sources: National Association of REALTORS, DQNews, CNNMoney, CNBC, AP.


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