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Mark Hemingway

Mortgage Market Update for February 7th

Saturday, February 9, 2019 - Article by: Mark Hemingway - Security Financial Services, LLC - Message

Mortgage rates continued to decline this week and are at the lows seen in April 2018. Freddie Mac reports that the 30-year fixed-rate mortgage fell five basis points to 4.41% with an average 0.40 in points and fees. Sam Khater, Freddie Mac's chief economist, says, "Mortgage rates are essentially similar to a year ago, but today's buyers have a larger selection of homes and more consumer bargaining power than they did the last few years."

For the first time in four months, mortgage credit availability rose in January. The increase was due in part to investors and lenders adding more programs for lower credit score borrowers along with new relief refinance programs. The Mortgage Credit Availability Index (MCAI) rose 2.3% to 179.0 in January. A decline in the MCAI indicates that lending standards are tightening, while increases in the index are indicative of loosening credit. The index was benchmarked to 100 in March 2012.

A big merger in the banking sector was announced today as BB&T will purchase SunTrust in an all-stock deal worth $66 billion. The merger will create the sixth-largest U.S. bank in an effort to compete with the country's biggest banks. The new company will operate under a new name that hasn't been decided on yet. The new bank will have $442 billion in assets, $301 billion in loans and $324 billion in deposits with the deal closing later this year.

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