Phoenix Mortgage Rates Report: December 7, 2007

brian_smile.jpgWe pause before our usual Phoenix Mortgage Rates Report:

Today is the 66th anniversary of the attack on Pearl Harbor. That attack was the first ever on American soil and was the trigger for American involvement in World War Two. 1,177 crew members lost their life on the USS Arizona making it the largest lost of life on an American warship. I ask you to pause for a minute and keep those sailors and marines in your prayers.

Veterans, did you know that your VA loan could be refinanced, to a fixed rate loan, with no income verification and no appraisal? It’s called the VA Interest Rate Reduction Loan. Watch this 13 minute video, released by the VA (just click the “Thinking of Refinancing?” link).

We are still maintaining our lock-in at application posture for mortgages. The much awaited jobs report came out today and the data looked better than expected. While the declining housing market may be a drag on the economy, the jobs data tells us that its reach, while far, isn’t throwing us into a recession.

Fixed mortgage rates, at 6% or better, should be locked at application. If rates creep up above the 6.0% mark, it makes sense to float. The Fed meets next Wednesday and the expectation of both a Fed Funds and Discount Rate cut is built into today’s mortgage rates. Waiting for the Fed decision could cost you a lot of money. If they don’t cut rates, mortgage rates will skyrocket to the 6.25% level.

Mid-term ARMs aren’t making sense right now. The only value I see in the ARM market is a 3/1 ARM at 5.25%. A fixed rate mortgage, at 5.75%, is tough to beat right now.

Jonathan Dalton

Jonathan Dalton is a 40-plus-year resident of the Valley and has been helping folks buy and sell homes since 2004. He can be reached at 602-502-9693 or info at


  • Kevin 10 years ago

    In what circumstances do you recommend getting a 3/1 ARM? It seems with this whole mortgage crisis at the moment that nobody should be extending themselves any further. Unless a family knows that they have to or will be moving out of their residence within that 3 year window it just seems like asking for trouble.

  • Brian Brady 10 years ago

    “In what circumstances do you recommend getting a 3/1 ARM?”

    You’ve cited one of the many reasons why a 3/1 ARM may be appropriate. The answer is, when it fits into the financial plan.

    My practice is different from most loan originators, Kevin. Most of my clients have 2-4 properties and have different challenges than the FTHB.

    For the person looking to buy their first home, a 3/1 ARM would have a pretty narrow application. However, the well-heeled property investor uses these instruments all of the time (successfully, too)