Arkansas Mortgage

Arkansas Mortgage rates along with naitonal rates saw a 35 bps increase for the week. There is no one thing causing the increase. It can be linked to a number of things including increasing inflation, tighter lending guidelines all around, a loss of confidence in Fannie Mae and Freddie Mac, and an upcoming general election.


A little later tomorrow morning, the report on new home sales for June will be released. This may have an effect on Little Rock Home Loans In May's report, the Commerce Department said that the seasonally adjusted, annualized pace of sales fell by 2.5% to 512,000. The decline was expected but data revisions changed an originally reported increase of 3.3% to a larger jump of 4.8%. Nevertheless, May's level was the second lowest since September of 1991.

Inventories of new homes on the market continued to decline as builders scale back construction. At the end of May, the seasonally adjusted level of homes on the market was 453,000, the lowest level since May of 2005. At the prevailing sales pace, this represented 10.9 months worth of inventory, the second longest turnover time since September of 1981. This may have a negative effect on Arkansas Mortgage loans.

Average new home prices fell by $9,900 between April and May or 3.1% and the median price fell by $12,500 or 5.1%. On a year over year basis, the average price edged up by $1.600 or 0.5% while the median price fell by $14,000 or 5.7%.

Washinton Mutual was the story of the day. Shares dropped sharpley as concerns grew about their portfolio. Earlier in the week WAMU reported a 3 billion dollar loss.

Downey Finacial was another big loser wih shares down 34%. Downey was one of the biggest sellers of option-ARMs, which let home loan borrowers defer part of the monthly payment and add it to the principal. Option-ARMs become more risky for banks when housing prices are falling because the loan's size can quickly exceed the home's value. In Downey's home state, households are foreclosing at 2.6 times the national average, contributing to a $258.9 million loss in the second quarter for the company and about $600 million in losses over the past year.