Mortgage Rates Drop to Record Low ~ Tax Credit Extension FAILS FINAL Vote.

Mortgage Rates Drop to Record Low: 30-year fixed mortgage rates dropped to their lowest levels in 39 years according to a new survey released by Freddie Mac, the second largest mortgage finance company.

Interest rates on 15 year fixed rates and hybrid adjustable rate mortgagerates reached fresh lows as well.  While record low rates and high housing affordability helped the housing market gain ground over the last year, the sector is struggling since the popular home buyer tax credit expired on April 30th.

According to a Freddie Mac survey, the average 30 year fixed rate for conventional (non-FHA and VA) mortgages averaged 4.69 percent for the week ended June 24th and is the lowest since Freddie Mac started the survey in April 1971.  Still, Freddie Mac’s data is at least a week old before they publish it and it has been another week since then.  Rates do vary depending on credit, debt ratios, down payment, area of the country, property type, points paid and many more factors.

$8000 Tax Credit Extension Fails Final Vote

What appeared to be good news for buyers who had loans in place before April 30th to qualify for the $8000 tax credit has turned sour.  The amendment was tied to another bill (H.R. 4213  American Jobs and Tax Loophole Act) that was voted down for the third and final time on Thursday.  Bad news for approximately 180,000 buyers who have loans in place that will be affected by the failure of this amendment.  Approximately $75,000 of the loans closing are for distressed properties.

The reason that the loans are not closing is due to the lenders backlog of loans in process and not any fault of the buyers themselves. Some buyers see this as a government bait and switch scheme!!  You can read the full article cy clicking HERE.   

Which is in response to … Senate approves home tax credit extension:

WASHINGTON — The Senate on Wednesday approved a plan to give homebuyers an extra

three months to finish qualifying for federal tax incentives that boosted home sales this spring.

The move by Senate Majority Leader Harry Reid would give buyers until Sept. 30 to complete

their purchases and qualify for tax credits of up to $8,000. Under the current terms, buyers had

until April 30 to get a signed sales contract and until June 30 to complete the sale.

The proposal, approved by a 60-37 vote, would only allow people who already have signed

contracts to finish at the later date. About 180,000 homebuyers who already signed purchase

agreements would otherwise miss the deadline.

Reid, D-Nev., added the proposal to a bill extending jobless benefits through the end of

November. Nevada has the nation’s highest foreclosure rate, and Reid is facing a tough reelection

campaign.

The Realtors group has been pushing hard in Congress for the extension. Mortgage lenders, the

trade group says, have been swamped with borrowers trying to get approved by the end of the

month. Many potential borrowers are unlikely to make the deadline.

“If Congress fails to act promptly, then prospective homebuyers might not get the benefit of the

homebuyer tax credit, even though they have completed contracts,” the Realtors said a letter to

lawmakers.

First-time buyers were eligible for a tax credit of up to $8,000. Current owners who bought and

moved into another home could qualify for a credit of up to $6,500.

The $140 million cost of the measure would be financed by denying businesses the ability to

deduct from their taxes punitive damages paid when losing lawsuits or judgments.

- Andrew Taylor (AP)

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