Reality Check Courtesy of Sean La Rue To All Customers: With a never ending stream of babble from the news media about low 4% interest rates for everyone in America, the one thing we can tell you for certain is that the government is not going to pay for it. If there is anything in this “mysterious” stimulus package to lower mortgage rates, it will only be some kind of assistance to help sell housing inventories; not to help lower the rates further for those making regular payments, trying to refinance. Mortgage rates are derived from bonds which are traded on the “free market”. Mortgage rates are now trading in a range between the upper 4% and low 5% range. This range is lower than it has been in the 37 years Freddie Mac has been keeping records. Trillions of dollars have been pulled out of the stock market and investors are sitting on the sidelines waiting for the market to stabilize and it will happen! When the money starts pouring back in, fixed rate mortgages will shoot up, 1%, 11/2% or more. Who knows? But they will go up and maybe overnight. When considering mortgage refinancing, do not expect to get the same rate as your neighbor, friend or relative, unless your financial profile, credit score, loan to value, property type, property usage etc., are identical. If you’re shopping rates, know that any published rate is obsolete before the ink dries; any quoted rates without a rate lock are probably meaningless. The bond market is in constant motion, just like stocks. Unlike many of our competitors, we monitor the bond market live. We see directional changes as they happen and get lock alerts from our service provider. Those of us that have been in the mortgage industry a while have lists of customers that tried waiting out an extra 1/8% to ¼% and completely missing the market lows. We see it every time rates dip. Don’t miss out. Call me today and start saving money now.
Mortgage Bonds are soaring higher on this weekend’s announcement that Fannie Mae and Freddie Mac will come under control of the government.
The government’s move to create a line of $200 billion to back all Fannie Mae and Freddie Mac loans at all costs is great news for homeowners. First, it ensures the continued liquidity of conforming loans nationwide and, second, it ensures that buyers of this type of Bond have a safe investment going forward. There’s no doubt that this will help the US housing market move through the current crunch that we’re in.
So far this morning, the news has lead to a nice rally in pricing. When combined with the break above the 200-Day Moving Average, this may lead to attractive rates. Therefore, I recommend floating for now.
It’s shaping up to be a busy month! Interest rates are at a 4 month low and I’m continuing to watch the bond market for you. See the article attached as well as the newsletter for an industry update. Make it a great month and if I can help you are someone you know with a purchase mortgage or refinance. Attached is a free appraisal flyer for you to use or give to a friend.
I mentioned on Friday that interest rates were on a roller coaster ride late last week. Fortunately, I noticed that mortgage bonds were overbought midweek and got my clients locked in saving most of them 0.125% on their 30 year fixed mortgages. This saved them anywhere from $25 and $40 per month. I look forward to helping your clients too. This weeks newsletter explains what happened last week.
THE TIME IS NEARING END FOR NEHEMIAH AND DOWN PAYMENT ASSISTANCE PROGRAMS (DAP)!
Let’s get those buyers off the fence asap! Franklin Loan Center’s platform is strong so utilize me with your clients who need to close fast. FHA IN 21-30 DAYS! At the end of September, as you know, the DAP will be going away, yet we have until September 5th to get the deals accepted and opened. If you have a buyer who needs to use these programs call me asap! If they can’t close before the end of September we can use a gift from a family member or other non-profit organization as long as the seller is not contributing toward the downpayment, up to 6% toward closing costs are still okay!
Call me today to get the ball rolling. I’ll pay for the appraisal send along the attached flyer with your client during the pre-qual interview.
I’m never too busy for any of your referrals.
Give me the opportunity to make you look good… We’ve had a great rally this week in the mortgage market and I’ve locked my pipeline to protect my clients from higher interest rates. This week I’ve save most of my clients 0.125% or more on their interest rate and they’re happy with the lower payments.
FHA loans and are going strong. Franklin Loan Center’s in-house closing platform is getting the job done quickly and the ability to sign loan docs in-house makes it easy for the clients with out-of-the-area escrow companies.
Hello Friends and Real Estate Professionals, You may be aware that Down Payment Assistance (DPA) is being threatened and we only have a couple of days left to prevent this new legislation. 79% of all mortgage transactions year-to-date have been backed by FHA (Federal Housing Administration). Over 80% of these FHA transactions involved some form of seller funded DPA. If this legislation is approved it will drastically affect, impede and reduce ALL of our abilities to buy, sell or lend on a home. I would like to ask you all to help by clicking this link http://capwiz.com/nehemia/issues/alert/?alertid=11598811and taking 60 seconds to send out an email that will go to HUD, Congress and our Local Senate Representative. I believe your efforts will help defeat a law that will facilitate a collapse of our local and national industry. On a side note, while the legislation says no more DPA after Oct 1st 2008, please be aware that we must stipulate the last day of funding if the bill passes be August 29th in order to give time to get the loans sold off of bank lines. To all Realtors: We must get these people into houses by August 29th(CORRECTION SEPTEMBER 29TH) to be safe. Franklin Loan Center is a direct endorsement lender for FHA loans, which means we can underwrite FHA loans and prepare loan documents in our local offices. This will save your clients valuable time. Time is running out so please act now and get your FHA buyers off the fence and into their new home before it’s too late. Once Down Payment Assistance is gone, it’s gone. Feel free to call us so we can explain this and forward the information to your buyers to ensure they understand the magnitude of this legislation. It would be our pleasure to help in any way we can; be it marketing your listings, helping your buyers qualify for a loan or simply being an information resource for you.
Last weeks rates improved slightly as bonds tried to rebound off the previous weeks losses. Philly Fed President is continuing to warn about inflation and it’s possible that fed rate hikes will be coming shortly. This is a good thing for the bond market because mortgage rates should come down. Following that your wallets at the pump should hopefully stay full. See the newsletter below to get some helpful gas saving tips that you can pass along to your clients.
Happy Friday! Please don’t forget to RSVP for the event on Monday morning at 8:30am. RSVP at http://www.DesertFHA.com The flyer is attached. Thank you if you’ve already RSVPed. I’ve got your seat reserved.
New Home sales for June were reported at 530,000–which was far better than expectations of 505,000. In addition, Orders for Durable Goods came in well above expectations and the Consumer Sentiment Index shocked the markets with a very robust reading.
The positive readings are helping to strengthen the US Dollar and even lower Oil prices. As a result of these shifts, a Fed rate hike may be on its way in within the next few months–though probably not at next week’s Fed meeting.
Nehemiah Program Housing Bill an immediate threat to down payment assistance ( DPA) programs.
The Senate and House of Representatives are fast tracking this bill, and is in danger of shutting it down. Today DPA comprises nearly 40% of all FHA’s loan volume, and will be a huge loss if passed.
So you must act now with any of your potential buyers who have be pre-approved to use the Nehemiah DPA program. I would hate to have a family miss out on their dream home because of procrastination on their part, or congressional action. I do not have any more information than what I have told you at this time, but this program could disappear tomorrow, next month, or hopefully never. What we do know though is that it’s under attack, and is in danger of being closed.
Market Update: Rates closed flat for the week which is fortunate because we had a bad stretch mid week with rates rising temporarily. Agency Loans are priced great, but make sure to have your borrowers call me to make sure they qualify for the restrictions attached to these mortgages.
Agency jumbo loans, are loan amount between $417K – $500K. There are only two competitive programs offered. 30 year Fixed – 6.000% 5 Year Fixed Arm – 5.375%