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Friday, April 09, 2004

Jobs Report Pushes Mortgage Rates To Highest Level In Four Months

McLEAN, VA -- In Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage (FRM) averaged 5.79 percent, with an average 0.7 point, for the week ending April 8, 2004, up significantly from last week when it averaged 5.52 percent. Last year at this time, the 30-year FRM averaged 5.85 percent.

The average for the 15-year FRM this week is 5.12 percent, with an average 0.7 point, up as from last week when it averaged 4.84 percent. A year ago, the 15-year FRM averaged 5.17 percent.

One-year Treasury-indexed adjustable-rate mortgages (ARMs) averaged 3.65 percent this week, with an average 0.5 point, up from 3.46 percent last week. At this time last year, the one-year ARM averaged 3.80 percent.

"The bond market reacted to the welcome news last Friday that jobs are finally being created, which is much needed for continued expansion of the economy," said Amy Crews Cutts, Freddie Mac deputy chief economist. "Mortgage rates again followed the bond market, rising significantly from last week to this week, and spurring speculation that the Federal Reserve Board will raise rates sooner rather than later.

"With that said, it should also be noted that long-term rates are not expected to rise precipitously and, in fact, we still expect the 30-year FRM will average below six percent for 2004."

Published: April 9, 2004

Related Articles:

Bush Mortgage Settlement Reforms May Be On Ice, But Guaranteed-Fee Mortgage "Packages" Are Hot

Mortgage Rates Jump In Anticipation Of Jobs Report

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New Legislation Provides Home Inspection Rules

by M. Anthony Carr

Home inspections have started receiving proper attention from state legislators over the last few years. For a piece of the transaction that was a deal maker or breaker, it always seemed interesting to me that this industry that sought out all the defects of a property could field employees who had no accreditation for determining the status of a home's physical condition.

While many reputable companies have for years offered extensive training to their inspectors, there were many others who became inspectors by virtue of hanging a shingle and taking out an ad. Unfortunately, that's all it took for them to become inspectors -- and it's still the case in 23 states. But in the last 13 years, starting with Texas, states have begun to require home inspectors to maintain varying levels of certification, training and/or licensing.

The states have really come under fire from Realtors, mortgage providers and now the inspection industry itself, asking that a standardized education process be put into place on the state level. Looking over the measures, however, shows that states have different ideas of what it takes to protect the consumer from inexperienced or incompetent inspectors who could cause more damage than good.

The American Society of Home Inspectors, Inc. (ASHI) has become an advocate of sensible, professional regulation. Representing more than 6,000 home inspectors across the country, ASHI says at its website that while it "will act to preempt governmental actions that would work to the detriment of the profession and/or the home buying consumer," it also demands that any legislation "require, at a minimum, passage of a psychometrically valid and defensible technical examination and adherence to professional standards of practice and code of ethics."

About five years ago the Examination Board of Home Inspectors instituted the National Home Inspector Examination, a content-valid examination for use by regulatory bodies and membership organizations. It's about the most standardized test for home inspectors out there and is used as a base line for several of the legislative acts passed in the last few years.

I've always advocated that a homebuyer should get an inspection of their targeted property -- and if possible, add it as a contingency on the contract. However, keep in mind that if your state requires certification or a certain level of education of its inspectors, that doesn't mean that's what you'll get when you cross the state line. Some states don't require certification or licensing -- just registration, passage of the above exam or national association exam and a fee. Still, others require nothing at all. Thus, in some states, such as Virginia where certification is voluntary, an inspector can still operate without the state's approval, it's just that he cannot call himself "state certified." Many inspection companies, however, require their inspectors to work toward the jurisdictional certification.

For a list of states and their regulatory requirements, visit ASHI's website (recently remodeled, I might add) and click Homebuyer, then follow the link to State Regulations. I would also suggest you take a look at ASHI's Standards of Practice and Code of Ethics if you are about to have a home inspected so you have an understanding of what the inspector should and should not be doing.

The home inspector is exactly that. While he may have a background in electrical, plumbing, construction or other home maintenance, he is not there to give estimates and tell you how to fix the defects. He's there to provide a status of the house. It should be an objective look at the property that lets the homebuyer (and seller) know the defects, weaknesses and potential future problems of the structure.

Even with state certification and all this training floating around, however, I've personally seen varying degrees of inspection. One investment property I was selling went through two contracts because of the first inspector. He found "dry rot" that in his estimation would cost more than $3,000 to fix because of flooring that, in his opinion, had to be replaced. Well, that contract fell through. The next inspector with the next set of buyers noted that some replacement wood would work and that it would cost about $300 to fix. This incident pointed out all the issues I had with the lack of standardized inspection services available to the homebuyer and seller in the marketplace.

Fortunately, ASHI, professional home inspector associations and state legislatures are now on the same page -- requiring a standardized examination process to assure to the consumer consistent treatment on their most expensive investment.

Published: April 9, 2004
Related Articles:

What Are They Afraid Of?

Definition Of A Home Inspection

Should Unlicensed Inspectors Be Allowed To Do Mold Inspections?

The "Problem" With "Problem"

Inspecting Your Home Inspector

Mr. Carr has covered real estate for more than 15 years. He is authoring “Street Guide to Real Estate,” due out 2004 through www.AmacomBooks.org. He can be reached via email at manthonycarr@erols.com.

Copyright © 2004 Realty Times. All Rights Reserved.

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