When Higher Rates Are Good News.

When are higher rates good news? The fact that rates on fixed mortgages have moved up in the past few weeks may actually be. Why? Because the rates on Treasuries have moved up further. This means that the spreads between mortgages and other rates are decreasing and could mean that the secondary markets are gaining confidence in mortgages again. Remember, part of the reason that rates on many mortgages have increased in spite of lower rates everywhere else is that the default rates on mortgages were so high. This accounted for the fact that adjustable rate mortgages and jumbo mortgages rose dramatically over the past year despite generally lower rates. Source: Origination Pro - Dave Hershman

Over 1 Million Forclosed Homes!

More than one million homes are now in foreclosure, the highest rate ever recorded, according to a trade group which warned Thursday that the crisis will continue to worsen. The Mortgage Bankers Association's first quarter report showed that a record 2.5% of all home loans being serviced by its members are now in foreclosure, which works out to about 1.1 million homes. That's up from the 2% of loans, or about 938,000 homes, that were in foreclosure at the end of 2007. The report also showed that 448,000 homes, or about 1% of loans being serviced, began the foreclosure process during the first quarter. That's up from about 382,000 homes, or 0.83%, that entered foreclosure in the last three months of 2007. The number of homeowners behind on their mortgage payments also hit a record high. Nearly 3 million home loans are now at least one payment past due, while about 737,000 are at least three months past due but not yet in foreclos ure. This marks the sixth straight quarter in which a record percentage of loans went into foreclosure. The trend has led to a widespread decline in home prices, as well as huge losses for banks and other financial firms that issued or invested in the loans. Source: CNN/Money