Mortgage trends improve

Denise Vensel, right, goes over loan paperwork for a home with Jeanie Peck, a loan officer with Unifirst Mortgage, who said buyers are becoming “a lot more conservative” in making sure they can afford a mortgage. Peck also said the loan market for refinancing is active.

Coloradans are paying off their home mortgages nearly a third faster than they were a year ago, signaling newfound confidence in the economy, officials said.

And others, such as Denise Vensel, are taking advantage of low interest rates and confidence in the economy to step out and take on their own mortgages.

Vensel, a divorced mother of two teens, planned this past Friday to sign papers at the closing of her new, three-bedroom, two-bath home and leave behind an expensive rental payment.

“I love it that it’s cheaper than rent,” Vensel said.

Many people who already own homes are seeking to lower their payments by refinancing, the Colorado Division of Housing said.

The number of paid-off loans jumped 31.4 percent from the first quarter of 2012 to the first quarter of 2013, according to a division report.

Public trustees in Colorado released a total of 98,321 deeds of trust during the first quarter of 2013, the highest quarterly total recorded in any quarter since the agency began collecting quarterly totals in 2008. The first quarter 2013 number eclipsed the 74,809 deeds that were released during the first quarter of last year.

In Mesa County, 2,529 deeds of trust were released in the first quarter, up 37.1 percent from the first quarter of 2012.

The increase in mortgage releases coincides with a slowdown in foreclosures, Mesa County Public Trustee Michael Moran said.

Both trends “seem to indicate an improvement in the local economy,” Moran said.

Releases of deeds tend to occur as refinance and home-sale activity increases, and rising release totals typically indicate increases in the demand for home loans and real estate.

The trend suggests that Coloradans are becoming more confident in their employment and are encouraged by low mortgage interest rates, said Ryan McMaken, an economist for the Colorado Division of Housing.

“People have a means to obtain refinances now which they did not have in 2009 and 2010,” McMaken said. “It’s really coming on the heels of seven quarters of declining (interest) rates.”

Refinancing appears to be the major generator of the mortgage-payoff activity, McMaken said, noting that sales activity falls well short of accounting for all the payoffs.

“A lot of people are going to shorter terms” because low interest rates, some as low as 3.75 percent, mean monthly payments still are affordable, Unifirst Mortgage loan officer Jeanie Peck said.

“The attitude has changed,” Peck said. “They’re a lot more conservative. They want to be able to afford the payment if one of them loses a job.”

That sums up her case, said Vensel, who noted that when she began looking, she was willing to put as much as 40 percent of her monthly income into her mortgage.

The papers she planned to sign will come in with a payment of about 20 percent of her income.

Now, Vensel said, she’s in the market for one more thing.

“I need a mower,” she said, looking at a photo of her new yard.

Even though rates are above those that were in the 2 percent range earlier this year, Wells Fargo Home Mortgage is still handling a lot of refinances, Carri Dixon, Grand Junction branch manager, said.

Wells Fargo’s mortgages on new purchases also are on the rise, and buyers are skittish, but moving ahead, Dixon said.

People “are a lot more realistic about what they should be buying,” Dixon said. “They’re nervous.”

So far, that’s meant that houses in the $180,000 range and below are selling, but “It’s hurting the high-end side of the market,” Dixon said. “There are not a lot of people looking there.”


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