Interest rates have fallen not just since 2007, but consistently over the past 35 years, according to a new report from Laurie Goodman, Urban Institute co-director of the Housing Finance Policy Center. The 10-year Treasury note peaked at more than 15% in 1981, but fell to just 1.83% in November 2016. Primary mortgage rates followed this pattern, falling from more than 18% in 1981 to 3.54% in November. Now, mortgage rates are increasing once more as the Treasury yield and the 30-year fixed-rate mortgage are up 44 basis points and 49 basis points consecutively as of July this year. Data from Freddie Mac and the Federal Reserve, demonstrates the falling interest rates from the early 1980s until 2016.
Freddie Mac announced it would be extending its appraisal-free mortgage program to purchase loans starting September 1, 2017. That same day, Fannie Mae also announced their appraisal-free purchase mortgage, offering its product effective immediately. But what does that mean exactly? Who qualifies? Are the GSEs moving to take appraisers out of the home buying process? For starters, why move to the purchase market to begin with? And how many Fannie and Freddie financed loans will qualify? Both GSEs already had a program in place for appraisal free refinances. Freddie Mac began their program earlier this summer, while Fannie Mae began offering appraisal-free mortgages on some of its refinances through its Day 1 Certainty program back in 2016. The answer from both companies was the same: After rising interest rates shifted the market from a refi market and more to purchase, the GSEs extended their programs to meet the needs of the shifting market.
Nearly everything about the industry’s prized digital mortgage is streamlined except for the final, and one of the most important, steps at the end. The entire online process comes to an abrupt halt when it's time to close a loan, forcing borrowers to still meet up and cross the T’s and dot the I’s on an official document with a notary present. And while this process is evolving digitally, as noted here, it wasn’t until recently that the process truly became end-to-end thanks to a new company: Notarize. Notarize took the current eClosing process and brought it to the next level by allowing buyers to never have to leave their home or wet sign a single document.
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