Refinancing is becoming a hot topic as mortgage rates are lowered, almost an average of 5.7% for a 30 year fixed rate loan. In some cities, lenders already offer 5.5% or less and no more than $1,000 in fees. This has happened since mortgage rates plunged to 20 year lows in mid January.

These are new historical lows as mortgage rates have ranged between 6 to 10% during the past twenty years. The difference between monthly payments between today’s rates and the lowest historical lows is not much, around $25 for every $100,000 and thus refinancing has become a serious option for most home owners.

Most borrowers may be put off by the 20% of the loan amount that they have to put up as banks and mortgage companies will only loan about 80% of a home’s current value. However, there are several options that are available to a home buyer like applying for an FHA loan or a VA loan.

The FHA loan is a home mortgage guaranteed by the Federal Housing Authority and finances up to 95% of a home’s value. Another option is the Veteran’s Affairs which funds up to 100% of the home’s value and it may be the only program that offers 100% financing.

I just read this report from the Associated Press that the US Government is about to close a deal that will increase it’s onwership in the beleaguered owners of Citimortgage, Citigroup. This will result in another large cash infusion in the bank while at the same time increasing government’s control on that financial institution. It will then demand changes on the board of directors, and other changes it has not yet disclosed.

Continue reading Government to Boost Ownership in Citigroup