Get the best refinancing deal!!

(Gerri Willis) gives tips on how to secure a low rate when renegotiating your existing mortgage.

NEW YORK (CNNMoney.com) -- Mortgage rates are lower than 5% - but how can you get the best refinancing deal?

Everyone has been asking me about how to secure these low, low mortgage rates. And many people are having a hard time even getting through to their lender on the phone. They're pretty frustrated.

I spoke with the chief economist of Fannie Mae yesterday. He told me it will take as much as three months for the mortgage industry to start working at full capacity. His full year outlook for mortgage rates is 4.8 to 5%. The takeaway here: Be patient - there will be lines.

1. Recognize opportunity

Look - there is opportunity here. 30-year fixed mortgage rates are at 4.6%. Historically, that rate is 8%. And that is significant.

Let's take a look. 30-year fixed mortgage rates are at 4.6%. If you took out a 30-year fixed loan of $170, 300 (the average cost of a home) at 5%, your monthly payments would be around $915. And at 8% you would pay $1,250. The savings? $335 dollars a month or $4,000 dollars a year.

2. Be wary

We've told you it might take longer to get a refinance now. And that's something to be aware of. And according to bankrate.com, Fannie Mae and Freddie Mac have increased their fees.

So you could be paying extra fees of 1% or 2% of the loan amount, and sometimes even higher on top of all other closing costs.

3. Get the best rates

Having enough equity is one of the biggest obstacles. These days you'll need at least 20% equity to get the best rates.

Make sure you keep your credit score as high as possible. Get copies of your credit report to make sure there are no errors at annualcreditreport.com.

Shop around to get the best rate. Get all your paperwork together now.

Here's a list of what you'll need to start collecting: Your refinance application, two years of tax returns, one month of paystubs, three months of asset statements (checking, savings, mutual funds), your most recent mortgage statement and a copy of the deed
I hope you find this information helpful.

If you have any questions please call me.
(562) 673-1136


Robert Vaughan
Vice President

Breaking News - The Fed is Buying Down The Rates

Learn How You Can Maximize This "Once in a Lifetime" Opportunity

The Federal Reserve launched a bold $1.2 trillion effort yesterday to lower rates on mortgages and other consumer debt, spur spending and revive the economy. To do so, the Fed will spend up to $300 billion to buy long-term government bonds and an additional $750 billion in mortgage-backed securities guaranteed by Fannie Mae and Freddie Mac.

Fed Chairman Ben Bernanke and his colleagues wrapped a two-day meeting by leaving a key short-term bank lending rate at a record low of between zero and 0.25 percent. Economists predict the Fed will hold the rate in that zone for the rest of this year and for most _ if not all _ of next year.

The decision to hold rates near zero was widely expected. But the Fed's plan to buy government bonds and the sheer amount _ $1.2 trillion _ of the extra money to be pumped into the U.S. economy was a surprise.

"The Fed is clearly ready, willing and able to be the ATM for the credit markets," said Terry Connelly, dean of Golden Gate University's Ageno School of Business in San Francisco.

Wall Street was buoyed. The Dow Jones industrial average, which had been down earlier in the day, rose 90.88, or 1.2 percent, to 7,486.58. Broader indicators also gained.

And government bond prices soared. Heralding a coming drop in mortgage rates, the yield on the benchmark 10-year Treasury note dropped to 2.50 percent from 3.01 percent _ the biggest daily drop in percentage points since 1981.

The dollar, meanwhile, fell against other major currencies. In part, that signaled concern that the Fed's intervention might spur inflation over the long run.

If the credit and financial markets can be stabilized, the recession could end this year, setting the stage for a recovery next year, Bernanke has said in recent weeks. The Fed chief and his colleagues again pledged to use all available tools to make that happen, and economists expect further steps in the months ahead.

Robert A Vaughan
Vice President

Would You Walk Away???

With 1 in 5 homeowners underwater, many pundits predict a flood of people walking away from their homes. Five readers talked to us about why they are - and are not - sticking around.


Fewer walking away than you think

Almost 20% of homeowners - or 8.3 million people - are "underwater" on their mortgages, owing more than their properties are worth. Another 2.2 million are near that drowning point, known as "negative amortization."

A basic cost-benefit analysis predicts that these people will abandon their homes and accept foreclosure. But there is little data measuring whether that logic holds true. In fact, Eric Johnson, a business professor at Columbia University, believes it doesn't. After years of studying behavioral economics - essentially the economics of choice - he argues that people will simply not make such rational decisions.

"There are two effects that suggest [walk aways] won't happen so easily," he says. "The first is the endowment effect. People tend to value their own house above its market price. Owners don't want to sell at a loss. They have what we call a loss aversion."

The second is that people weigh the importance of immediate outcomes more heavily than long-term effects. Walking away involves upfront expenditures of time, money and effort, while the benefits of walking away are back-loaded.

"People are impatient and weight present costs and benefits more, so they will walk away less often than we might think.

I want to Thank you for checking this Blog out and if you have any questions or no someone that has suffered a hardship and is having trouble paying there mortgage. Please pass this contact information.

Robert Vaughan
Vice President