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Monday, March 2, 2009

Mortgage Refinance Overwhelming Lenders 2009

By Monique M. Zidan

Mortgage Refinance has created a surge in the lending business, somewhat unexpectedly and during uncertain economic times. Rates have dropped below 6% when the Federal Reserve made the decision to buy mortgage-backed securities to stimulate consumer financing once again.

The Government has initiated buying the mortgage-backed securities as of this week and has reduced rates further. This has contributed even more to the mortgage finance business and has added to the struggle lenders are currently experiencing not long after the financial downturn forced lenders through a layoff period.

Buying mortgage-backed securities has already started to take place as of the second week in January of 2009, as the plan of action the Federal Reserve announced in November of 2008. This has spurred even more activity for the mortgage finance business, also adding to the struggle lenders are currently experiencing after the financial downturn of last year, forcing lenders to downsize.

The sudden drop in rates is proof enough the mortgage finance surge has found lenders under-prepared during a time when they could really maximize on the opportunity to make up for the lull in previous months. With unexpected delays in applications following up with prospective customers, understaffed lenders scurry to service consumer requests for mortgage refinance.

To make up for a shortage in staff, people from other departments experienced in finance within the lending institutions have been transplanted to handle the increase in mortgage refinance. The possibility of rates going back up has created a sense of urgency and worry. As we know the history of fluctuating rates, it is possible to see change from hour to hour.

If there are contacts directly related to the lending industry or connections with a real estate agent that can act as a liaison to help deal with a mortgage refinance, this will offer a stronger start. There is also the possibility some lenders may not have the time reply to the message or to an online application before some are able to lock in a great rate.

When a prospective customer is told to apply on the Web after finally getting through to a live person, it becomes obvious it is time to be a little more aggressive in approach. For those consumers that do manage to reach a lender it would be wise to know the most recent rate available. Some online lending sites have not posted the best rates for fear of being bound by them.

Any connections directly related to the lending industry or connections with a real estate agent that can act as a liaison to help deal with a mortgage refinance will help greatly. There is a strong possibility some lenders may not reply to the message or to an online application. With business presently looking up for lenders, it would be smart to secure that magic number by not waiting around for the lender to respond.

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