Thursday, Nov 27, 2008
Would-be mortgage borrowers have rushed to refinance their loans and even weighed plans to buy homes following the government’s move this week to loosen consumer lending.
With interest rates suddenly plummeting, “the phone is ringing, the e-mails keep coming,” said Jennifer Du Plessis, a mortgage adviser at Prosperity Mortgage, the lending arm of Long & Foster. “Real estate agents are hovering outside our office saying: ‘I’ve got another client who wants to refinance.’ ”
“Our loan officers were here well past midnight,” Bob Walters of Internet lender Quicken Loans said regarding Tuesday, when the government announced its plan. Quicken received $400 million worth of mortgage applications that day, more than quadrupling the number of loans from the day before, he said. It was on track to meet that number yesterday, too.
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Vivianne Couts, a Northern Virginia real estate agent, said one of her clients had planned to buy a house in Fairfax County this spring but yesterday sent her an e-mail saying, “Interest rates are low. I don’t know what’s going to happen in the future, so let’s go for it.”
Almost immediately after the Federal Reserve announced plans Tuesday to buy a sizable chunk of mortgage-based securities, interest rates dropped to the mid-5 percent range and stayed there through yesterday. The move is giving borrowers a “taste of the bailout pie,” said analyst Mike Larson of Weiss Research. Until now, most government mortgage initiatives have been aimed at lenders or at distressed borrowers.
This article was posted: Thursday, November 27, 2008 at 11:33 am