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Phoenix Mortgage Refinance

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The fifth most populous city in the United States, for over a century Phoenix, Arizona has drawn sun lovers to the Sonoran Desert, with its average summertime high temperatures of over 100 degrees and dry desert air. The city itself has a population of about 1.5 million people, while the greater Phoenix metropolitan area, not surprisingly called Valley of the Sun, is home to a total of 4.3 million. In contrast to many U.S. urban centers that have experienced population decline as residents continue to flee to the suburbs, in the twenty-first century Phoenix experienced phenomenal growth, with its population growing 24.2% since 2000.

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Mortgage refinance - Phoenix

Mortgage rates are at all-time low levels. There has never been a better time to refinance and lower your mortgage payment. If you have an adjustable rate mortgage (ARM) you can refinance and get a low fixed rate. You don't need perfect credit to apply.

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But the growth was uncontrolled and in 2008 Phoenix was devastated by the subprime mortgage crisis. In that year the Phoenix metro area experienced nearly 98,000 foreclosure filings and a foreclosure rate of over six percent. But the following year the situation became worse, and a total of 133,809 Phoenix residential properties received notice of foreclosure or default. According to NowPublic, the 2009 foreclosure rate of eight percent gave Phoenix the eighth highest foreclosure rate among U.S. metropolitan areas. Statewide, with a foreclosure rate of 6.12 percent, Arizona was second only to Nevada in a ranking of the U.S. states of foreclosure activity.

By early 2009, the median price of a Phoenix home was $150,000, down from its high of $262,000 in recent years. What was the problem? The painful foreclosure rate in Phoenix was driven by a variety of factors including overbuilding, home price inflation during the real estate boom, risky mortgage-lending practices, easy availability of home loans, borrowers who refinanced their original loans to higher amounts, and a high number of flippers - people who had bought for quick profit and then, when the market went south, were forced to quickly unload at a loss.

There is some good news. The Arizona State University Real Estate Center reported that since the last months of 2009, home prices in Phoenix have held steady, with foreclosure homes selling at less of a discount than previously. In January of 2010, the Arizona Senate introduced foreclosure prevention legislation, crafted to combat loan modification fraud and designed to help reduce Phoenix foreclosures.

Home prices in Phoenix neighborhoods vary considerably. In Camelback East, the average listing price in June 2010 was $441,942, with the southern Ahwataukee Foothills coming in at $373,770. In North Mountain the average was $208,041, and in Alhambra, just to the south of North Mountain, the average home listed for $205,770. Meanwhile, a Deer Valley home averaged $171,073, while an average home in South Mountain could be picked up for a mere $125,802. But even prices in South Mountain could go lower; through the first and second quarters of 2010 South Mountain prices were still trending downward.

For Phoenix-area homeowners looking to refinance, Trulia provides a sample of refinancing rates as of June 2010. For a $300,000, 30-year fixed rate refinance, annual percentage rates (APRs) range from a high of 5.047% to a low of 4.446% at lenders including Quicken Loans, AimLoan.com, Pinnacle Peak Lending, and Hart West Financial. Fees and points vary, and less-qualified borrowers can expect to pay more. When home values drop there is a danger that the loan-to-value ratio exceeds the key 80% mark. In that event, Homeowners must wait until home values rise again.

The overview is that the Phoenix real estate market is defined by bank owned (foreclosed/REO) properties that continue to flood the market. According to RealtyTimes, many of the bank-owned properties are in very bad condition, but if you shop around you can find homes with quality upgrades in move-in condition. There are also single-family homes, townhouses, and condos that have been put on the market by homeowners who are facing foreclosure or who are otherwise highly motivated to sell. Home prices even in gated communities and on lakefront locations are extremely affordable and attractive and near rock-bottom prices. If you are considering a move to the Sun Belt, now is a great time to contact a local realtor in Phoenix and snap up a bargain.