My New Blog

It's funny, on any given day of the week I can go into my 150-200 emails and find articles from credible organizations about the economy that project opposite views of the market and the status of our economy. I can read both glowing and gloomy outcomes for the near term.  I guess I could find an article to support just about any claim that I want to make. Yeah, rates are down, rates are up, housing is booming and busting, or that consumer confidence is worse or better. It's nuts trying to read the real pulse, but it doesn't take a genious to see that our micro and macro economies are struggling.

Just keep in mind that everything relative. If you are the buyer today, wow, you rock! If you are selling your home today, you are taking it in the shorts. If you are selling short, so is your lender, but you and your lender will recover! If you need a loan, the rates couldn't be better! Underwriting? Back to standard procedures to qualify borrowers, not harder to qualify for a home loan, just back to reality.

You're going to be OK. You're going to be fine. Hold your head up, move forward, and focus on what you want. Your goal is farther off than it was a few years ago? Ok, we will move a little faster and farther to get there. 

Ok, I was born on a Saturday. That means I "work" for a living. I am not averse to work, and my clients great value for their money. I have closed a number of short sales with a variety of lenders and would consider myself an experienced short sale negotiator...HOWEVER, I do agree with the California Association of Realtors survey, released this week, which finds that Realtors are very disatisfied with the Short Sale Process.

Short sale process broken, REALTOR survey finds

Happy Holidays!

This holiday-shortened trading week brings us the release of six monthly or quarterly economic reports. Only a couple of the reports being released are considered to be of high importance to the markets. With the Christmas holiday being observed during the week, we can expect very thin trading. This means that we may see a larger reaction than normal to some news because there will be fewer traders working and less transactions being made.

There is no relevant economic news scheduled for release tomorrow or Tuesday, so look for the stock markets to help drive bond trading and mortgage rates those days. Generally speaking, stock market strength should equate into bond weakness and higher mortgage rates. However, the light trading could allow some movement in the major stock indexes without heavily influencing bond trading and mortgage pricing.

Two of the week’s reports are scheduled for posting Wednesday. The first is the final revision to the 3rd Quarter GDP. I don’t think this data will have an impact on mortgage rates unless it varies greatly from its expected reading. Last month’s first revision showed that the economy expanded at a 2.5% annual pace during the quarter and this month’s revision is expected to show a small upward revision. A revision higher than the 2.7% rate that is expected would be considered bad news for bonds. But since this data is quite aged at this point I don’t think it will have much of an impact on mortgage rates Wednesday.

The second report of the day is November’s Existing Home Sales report. This release will come from the National Association of Realtors while Thursday’s New Home Sales data is a Commerce Department report. Both give us a measurement of housing sector strength and mortgage credit demand, however, neither is considered to be of high importance. And both of the reports are expected to show increas es in sales, indicating housing sector growth. Weaker than expected readings would be considered positive for bonds and mortgage rates because they hint at a still weakening housing market, but unless the actual reading varies greatly from forecasts the results will probably have little or no impact on mortgage rates.

Thursday brings us the release of four reports, including the New Home Sales data. The first is November’s Personal Income and Outlays data. It will give us an important measurement of consumer ability to spend and current spending habits. Since consumer spending makes up two-thirds of the U.S. economy, any related data usually has a noticeable impact on the financial markets and mortgage rates. Current forecasts are calling for a 0.2% increase in income and a 0.5% increase in spending. If this report reveals weaker than expected readings, we should see the bond market improve and mortgage rates drop slightly Thursday morning.

November’s Durable Goods Orders will be the second report posted early Thursday morning. This data gives us an important measurement of manufacturing sector strength by tracking orders for big-ticket items or products that are expected to last at least three years. Analysts are expecting the report to show a 1.0% decline in new orders. A larger decline in orders would indicate that the manufacturing sector was weaker than many had thought. This would be good news for the bond market and should drive mortgage rates lower. However, an increase in orders could lead to mortgage rates moving higher early Thursday morning. This data is known to be quite volatile from month-to-month, so it is not unusual to see large headline numbers on this report.

The third report of the day comes late morning when the revised University of Michigan Index of Consumer Sentiment for December is posted. Current forecasts are calling for an upward revision from the preliminary reading of 74.2. This is fairly important because rising consumer confidence indicates that consumers may be more apt to make large purchases in the near future. A reading above the 75.0 that is forecasted would be negative for bonds and mortgage rates.

The last report of the day is November’s New Home Sales. It is this week’s least important report and is unlikely to influence mortgage rates unless it reveals a significant surprise.

Overall, I am expecting to see some movement in the markets and mortgage rates, but nothing drastic unless we get some surprising results from the week’s data. That said, we still need to keep a cautious approach following the surprising volatility of the past couple of weeks. I still believe there is more room for improvements to mortgage rates. We saw some improvement late last week and I believe there is a decent possibility of extending those gains the next couple of days.

The bond market will close early Thursday and will be closed all day Friday in observance of the Christmas Day holiday. This means that firms that trade bonds will likely be keeping only a skeleton staff the latter part of the week and raises the possibility of a stronger reaction to surprises in the economic data than we normally would see. Accordingly, proceed cautiously this week if still floating an interest rate and closing in the immediate future.

If I were considering financing/refinancing a home, I would.... Float if my closing was taking place within 7 days... Float if my closing was taking place between 8 and 20 days... Float if my closing was taking place between 21 and 60 days... Float if my closing was taking place over 60 days from now... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

Are you too busy to save yourself money without spending a dime? If I can save you at least $200 a month on your house payment, and you did not have any out of pocket cost, would you take it? You won't believe how many people don't take it. Really! Primarily because they have to dig up their last two years financials and take a little time while I complete their application with them. That's right, we are in "full doc" mode now, it's back to reality. It's good for you and good for the lender.

Hey, it's very expensive for me! I am the one who has gone through all of the new regulatory compliance steps to obtain a MLO (Mortgage Loan Originator) license, for myself and for Advantage, as well. It cost alot of money and alot of time and I was required to pass both State and Federal exams (which I aced, by the way). I had to do that in order to continue to do what I have been doing for 23 years, and to prove to you and the regulators that I am good for what I say. And I am!

As we move into the holidays, think about calling me and seeing if I can save YOU any money.

Can you feel it? The munchkins are coming out of hiding! The bears are coming out of their dens after a long, cold winter!

In the housing market, people are feeling more confident about investing in property. Home prices are stable, back to reality.  Between the $8000 first time buyers can get and my credit to them of part of my commission, they have very little out of pocket closing costs.  By the way, that credit is good up until June 30th as long as we get you into escrow by April 30th!

On the financing side, mortgage interest rates are crazy low!!  Various types of financing options are available now. For example, I have a 30 yr loan, fixed for 5 yrs, in the 3%'s. Hey, did you know I work with all the major banks to get my borrowers the lowest interest rates? I do the shopping for you!

Self employed borrowers should see an expansion of guidelines this year to help them qualify for home financing. There is a huge sector of self employed home owners who would greatly benefit from being able to refinance their homes, or move up or move down to purchase homes. A large sector of those who have lost their homes are in this group of self employed workers who's pay was cut, and were not allowed to modify their loans! What a shame!

The rental market is heating up, as well. The rental market will continue to grow as folks who cannot afford their mortgages rent out their homes to other folks who have done the same. It's like a big housing swap!

Call me anytime if you need more info...This is what I do!