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    Interest Rates Hit New Lows

    There is a lot of positive activity for consumers in the mortgage market this month which will undoubtedly help keep the Los Angeles real estate market on steady footing into 2021. Here are the highlights and my take on the news.

    Mortgage rates fall to a 58 – week low.
    Interest rates on purchase loans fell again last Friday to at or near record lows but bounced up a bit yesterday. To provide perspective for anyone who may react to small, daily rate
    fluctuations – today, rates on a 30-year fixed are just over 2.7%. This time, a year ago, the same loan was around 3.68%. Refinance rates are also down on a 30-year and a fixed 15-year loan.

    Speaking of refinances…

    2020 is going to be a record year for refinance loans.
    Spending more time at home and low-interest rates have spurned a perfect storm that is on a path to record the highest number of refinance loans in one year in U.S. history.
    According to the national Mortgage Monitor Report released yesterday, 4 million homeowners have refinanced their mortgages in 2020 through the third quarter, with refinance origination volumes topping $2 trillion. Fourth-quarter volume is on track to more than double the activity to 9 million refinance loans. The analysts behind the report predict that 19.4 million U.S. homeowners with a 30-year mortgage can qualify and benefit from a refinance.

    If you are one of the 10.4 million homeowners out there who haven’t taken action to refinance, I strongly urge you to consider taking advantage of this moment to get a better rate on a 30-year term or switching to a 15-year loan. I have talked about this before – if there was ever a time to switch to a 15-year loan, this is it. With rates just above 2%, you could be in a position to get into a monthly payment that is manageable and save a lot of money on interest over the life of the loan.

    FHFA announces higher conforming loan limits.
    Last week, the Federal Housing Finance Agency (FHFA) increased conforming loan limits for 2021 to a minimum of $548,250 and a maximum of $822,375. I can execute a pre-approval letter or originate a purchase loan now using the new guidelines. Contact me for more details.

    2021 conforming limits for Los Angeles County

    Minimum Conforming Loan limits
    1-UNIT
    $548,250
    2-UNIT
    $702,000
    3-UNIT
    $848,500
    4-UNIT
    $1,054,500
    Maximum Conforming Loan Limits
    1-UNIT
    $822,375
    2-UNIT
    $1,053,000
    3-UNIT
    $1,272,750
    4-UNIT
    $1,581,750

    As we head towards the final stretch of 2020, I want to take a moment and express my gratitude for the opportunity to be a solution for hundreds of Angelenos who took the step to purchase or refinance a home this year. Getting into the right loan is essential to financial well-being, and the role I play in the process is one I never take for granted. Thank you for trusting me with your business.


    Mark Cohen
    CEO & Founder, Cohen Financial Group
    310-777-5401
    markcohen@cohenfinancialgroup.com