| Banks See Spike In Refinancing Applications
MADISON, Wis. -- Refinancing applications have surged 17 percent after interest rates dropped three-quarters of a point in the past week -- and they could go lower. VIDEO: Watch The Report But financial experts said it is important to know when it's best to refinance and if the type of loan a consumer has is even affected by this week's federal rate cut. Don Bertucci, AnchorBank's senior vice president of residential lending, said the last few days have been hectic. He said the phones have been ringing and the online applications have been coming in, all in response to this week's rate cut by the federal reserve. So, what does the 0.75 percent rate cut mean for residents? "It would affect mostly second mortgages or home equity lines of credit, where the rate is adjustable," Bertucci said.
State reaches $105,000 settlement with mortgage company
The Kentucky Office of Financial Institutions has reached a $105,000 settlement with Nationstar Mortgage LLC. Nationstar, formerly known as Centex Home Equity Co. LLC, does not admit liability, according to a news release. The settlement arose from investigations of the company's offices in Louisville and in Lewisville, Texas, in 2006. OFI concluded that Nationstar has employed "numerous unregistered loan officers," the release said. The $105,000 settlement will go toward the Nationwide Mortgage Licensing System, a collaborative effort among state regulators to bring greater efficiency and accountability to the mortgage industry by creating a standardized system for licensing. As part of the agreement, OFI also has been directed to adjust loans where violations might have occurred in regard to the refinancing terms.
Home equity loan avoids fees of refinancing mortgage
Q. I would like to refinance my adjustable-rate mortgage to lock in one of today's low rates. But I don't want to pay a lot of fees for a new mortgage that would actually make my monthly payments bigger over the next year. Refinancing would cost thousands, which seems like an awful lot for a loan of only about $80,000. What should I do? A. You might consider a home equity loan instead of an ordinary mortgage. Many home equity loans are unusually attractive now. Yours is a dilemma that confronts many homeowners with adjustable mortgages, or ARMs: They may be happy with the low interest rates they're paying today - in many cases only 4 percent or so - but they worry their rates will rise in the future. It would be nice to lock into a low fixed rate, but refinancing fees can total thousands.
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