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A 100% USDA Rural Housing loan may help you buy a home. We are the No. 1 lender in Tennessee, according to Rural Housing.
Call me to get you pre-approved and identify USDA locations. Most eligible homes are in subdivisions, not out on the farm as "rural" may imply.
Gary Moore 615-579-8658
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Gary Moore Tells Channel 2:
'Now is the Time' to Buy or Refinance
While Rates are at Record Lows
MORTGAGE RATES CONTINUE TO DWELL
IN A RANGE OF HISTORIC LOWS.
THERE WILL BE NO BETTER TIME
TO REFINANCE....NO BETTER TIME TO BUY.
What are you waiting for?
615-579-8658
APPLY SECURELY ON-LINE NOW
TOP 10 REASONS TO CHOOSE US
1--We take the view of a Mortgage Planner, which means we look at your broader financial picture and focus on what is in your best interests, rather than being transaction-focused and looking to make the next loan.
2--Extensive program choices to custom-tailor the loan scenario to your unique needs and objectives. That includes conforming, Jumbo, FHA, 100% VA, fixed rate, adjustable, interest-only, 100% Rural Housing, etc.
3--Aggressive rate pricing to provide you the lowest monthly payment.
4--Free pre-approval to identify your best loan choices.
5--Free loan approval certificate to help you and your Realtor negotiate your best deal.
6--Counsel with you and your Realtor to craft the language of your offer to get the seller to accept the lowest possible price and to pay your closing costs.
7--Local, in-office processing and underwriting for maximum communication with you, your Realtor and other parties to your closing.
8--Free resources and counseling on real estate, credit and financing issues.
9--Market updates and consumer information periodically emailed to you about market conditions, news, changes, and trends. Click here to sign up.
10--Refinance and purchase financing everywhere in Tennessee and many other states.
Gary Moore's
Weekend Market Update
Sept. 17-18, 2011
NOTE: Due to my web site company, a la mode, which is usually very good, changing something which I cannot explain, I am temporarily unable to post to my blog, "News You Can Use." In the meantime, I will use this space to post Weekend Market Update, Tips from the Trenches and any other of my market news and resources. --Gary Moore 615-579-8658
Major stock market averages closed up for the week on Friday, and mortgage rates ended the week unchanged to slightly higher.
The S&P 500 gained 5.4% for the week and closed at 1,216 for its third largest weekly gain since 2009. European government officials and bankers said they were making progress toward heading off a Greek and Euro zone debt crisis, and that piece of information in the ongoing European saga was credited with putting wind in the market's sails. The Dow Jones Industrials and Nasdaq indexes were also up, closing respectively at 11,509 and 2,622.
Technology shares rose the most among S&P sectors with Ebay up 18.8% to $33.69, and Dell announced it was so flush with cash that it had authorized $5 billion to buy back its shares. Dell shares rose 8.8% and closed at $15.20.
The 10-year Treasury was unable to hold below 2% yield, where it had resided for the past two weeks, and closed at 2.07%.
Seven states joined the U.S. Justice Department's lawsuit to block AT&T's takeover of T-Mobile. States joining the suit were Washington, New York, Ohio, Illinois, Massachusetts, California and Pennsylvania as their attorneys general said the $39 billion deal would hurt competition and raise wireless telephone and Internet prices.
Call me to get pre-approved for a purchase or to run a refinance analysis to weigh your options. Amid a lot of negative economic news, now is the time for you to act in your best interests by taking advantage of mortgage rates at historical lows. Call me with any questions. Nothing ventured, nothing gained. Gary Moore 615-579-8658
30-Year Conventional Fixed
4.25% $100,000-$417,000
15-Year Conventional Fixed
3.375% $100,000-$417,000
30-Year FHA-100% VA
4.0% $100,000-$393,300
30-Year Jumbo Fixed
4.85% $417,001-$1,500,000
(Interest-only available-Call me)
Rural Development 100%
4.00 % $100,000-$417,000
THDA Great Start 100% with Gift
4.85% $100,000-$393,300
4% of loan amount Gift
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Mortgage Planner, First Community Mortgage
...a subsidiary of First Community Bank
Cell: 615-579-8658 Toll-free fax: 866-321-6513
Quote of the Day
"Tact is the ability to describe others as they see themselves." -–Abraham Lincoln
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
National Mortgage Licensing System #186007
Market Update informs consumers and Realtors on market trends, offers subjective opinions, does not express APR and is not a quote for a unique borrower.
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Devastation in Nashville
This late-model Audi--and a trash can caught under its gas tank--crashed into a tree after a turbulent ride down Sugartree Creek. Incredible flooding has crippled Nashville, leaving bizarre images interwoven with the fresh shock
of life-changing damage.
--Gary Moore, May 3, 2010
See my blog for new location of Weekend Market Update
Weekend Market Update archive below
Weekend Market Update
Aug. 29-30, 2009
Like a box of Cracker Jacks, there is a surprise inside this week's Market Update. Read on.
Stocks fell slightly on Friday but still closed up for the week in light trading. Despite the Friday weakness, the major indexes remain in the black for August. The S&P 500 and Dow industrials are up about 4% for the month, largely thanks to a big rally across financial stocks, while the Nasdaq Composite is up about 2.4% on the month.
The market's appetite for risk is up as evidenced by buying in formerly flattened, government-propped equities, such as AIG and Fannie Mae. American International Group was up 50% for the week. Some traders, however, in staring at September---which is historically the worst month of the year for stocks---were pulling back and locking gains. Many market watchers are looking for a pullback to a former resistance level---or at best a flat line in the near term.
Among economic data released Friday, the latest Reuters/University of Michigan reading of consumer sentiment slipped to 65.7 in August, down from 66.0 in July. New data from the Commerce Department showed that consumer spending rose mildly in July, but personal income was unchanged.
The 10-year Treasury note was down in yield and closed at 3.45% on Friday. This instrument, which generally correlates with mortgage-backed securities, has been closely hugging the 3.5% yield zone since July 1.
Here is the "surprise"---sorry, it's not free money, but a little mortgage biz humor:
A Loan Officer died and met St. Peter at the Pearly Gates to present himself for admittance to Heaven.
Peter said, "You did a lot of good helping people get into homes, and you donated a lot to charity. You even worked on that Habitat house. But you told too many fibs to the underwriters and were very unkind to your processor and office staff.
"We aren't sure where you're going to fit...so, we've decided to show you around both Heaven and Hell and see where you feel comfortable."
As they toured Heaven, the Loan Officer really liked the big mansions and the streets paved with gold, but the harp music did get on his nerves a little.
Then, when they showed him around Hell, he noticed everyone had their choice of playing golf or tennis, hanging out by the pool smoking and drinking, or dancing and playing cards in the clubhouse. He told St. Peter, "Oh, this is going to be hard. Can I sleep on it?"
So, he was allowed to think it over during the night. The next morning they asked for his decision. He quickly replied, "Oh, please, send me to Hell!"
They opened up the doors of Hell, but the whole picture had changed. It was just like you have always heard with lots of fire and brimstone. People were burning and being tortured and screaming. It was hot and horrible.
"Hey, that's not what you showed me!" the Loan Officer cried.
St. Peter's reply was cold and abrupt: "I know; you should have 'locked' yesterday."
--from my assistant, Courtney Snyder
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.25% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
6% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something." - Franklin D. Roosevelt
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Aug. 15-16, 2009
Lenders were whip-sawed by bond markets on Friday, dropping mortgage interest rates in the morning and then changing course and pushing rate pricing a hair higher in the afternoon. We put out a “rate alert” at 11:02 a.m. to lock any unlocked borrowers, and that observation precisely tracked the market moves---catching the mid-morning drop and dodging the late-afternoon price deterioration.
Rates eased slightly this week, continuing to be held down by a weak economy and low or no inflation. Friday afternoon’s reversal was a pre-weekend reflex to the bond market having traded in one direction for most of the week.
For those of you who are watching the bigger picture---and I hope this is all of you---rates remain in a multi-year channel of historic lows. The daily and weekly small moves are merely background noise. Favorable interest rates and large inventories of properties for sale make this an optimum time to purchase or refinance real estate.
Consumer sentiment weighed on stocks as the University of Michigan reported a drop from 66 in July to 63.2 in August, which the markets believe foretells the level of consumer buying. Major stock market indices broke their four-week winning streak. The 10-year Treasury closed at a yield of 3.56%.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.25% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
6% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"The Stone Age didn't end because they ran out of stones; the Oil Age won't end because we run out of oil." - Don Huberts
Visit my real estate website:
http://www.REALCarte.com
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower. )
Weekend Market Update
Aug. 8-9, 2009
Mortgage interest rates popped higher and so did stock prices on Friday after the unemployment rate declined for the first time since April 2008. Labor Department data showed employers cut 247,000 non-farm jobs in July -- a serious loss -- but far less than the 320,000 expected and the smallest decline in a year.
The July unemployment rate eased to 9.4% from 9.5% the prior month. Some analysts are calling an end to the recession, which is bad for bonds, because economic growth often creates an environment with inflation concerns that make bonds less attractive to investors. The result usually ends up being higher mortgage rates as investors shift funds into a growing stock market.
Major stock indices hit 2009 highs, with the Dow closing at 9,370, up by 2.2% for the week and the S&P 500 up 2.3% to 1,010. The Nasdaq index closed up 1.1% at 2,000. The 10-year Treasury was up in yield at 3.85%.
30-Year Conventional Fixed
5.375% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
6% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Genius begins great works, labor alone finishes them." - Joseph Joubert
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
Putting the ‘Truth' in Lending
By Gary Moore
Mortgage Planner
"The truth hurts," they say.
That comment usually applies to facing the uncomfortable facts and dealing with reality rather than being in denial. But a new way to require the "truth in lending" will be painful for the sleazy and marginal element by forcing them to play on the same field as do I and the majority of mortgage originators.
New mortgage guidelines which went into effect yesterday, as part of the Housing and Economic Recovery Act (HERA) and the Mortgage Disclosure Improvement Act (MDIA), will hopefully force mortgage providers of all stripes---brokers, bankers and lenders---to tell the truth to borrowers up front, so that the paperwork at the closing table looks strikingly similar to what they thought they were getting when they applied.
From my personal perspective, I look forward to not having to compete with---and lose loans to---those who tell borrowers whatever they want to hear up front, and then close the loans much differently. I look forward to prospective borrowers accepting the truth in the following statements I make:
1---You "shop" for a loan by shopping for the integrity, skill and experience of the person and the company you are dealing with; by determining who is more likely to get the loan done on time and with no surprises; by determining which originator and processor are more likely to be accessible, easily approachable and proactive in keeping you in the loop, and by who is more likely to be in business to answer your questions and assist you with any concerns next year, or for the next two years, five years, etc.
If it is obvious to a mortgage broker that you are "shopping" for a loan on the basis of what interest rate someone will sling at you, or half-truths on closing costs, you have shot yourself in the foot. You may get "played," as the mortgage person sees you are playing him or her and that you are a time-waster with no loyalty. The truth is that interest rates are about the same with everybody, so a good decision by a borrower is tipped by other factors.
2---What I tell you on the day of application will still be true on the day you close. If anything changes along the way---such as due to guidelines, the market or underwriters---it will be with your knowledge and consent at every step. I have lost many a borrower who was swayed by a mortgage broker who sold them pie in the sky---such as, "you don't need to document income to get this loan"---and then closed the loan differently, when the borrower was sitting at the closing table with the moving van already loaded and rolling. Under that pressure, most borrowers feel they have no choice but to close the inferior, more expensive loan.
The portion of the MDIA that will hopefully be a field leveler requires that if the Annual Percentage Rate (APR) of the loan changes by more than an eighth point from the original disclosure, that the loan terms must be re-disclosed to the borrowers, and that the loan cannot then close for four days. This would iron out some of those closing table shockers.
Failure to comply could result in a $4,000 fine to the lender per incident. Lenders are so freaked, scared, concerned----you pick---about this that one of my lenders has added two new staff positions just to handle this change, which is actually a change to the Truth-in-Lending Act. It is the "TIL," or truth-in-lending form, which reflects the APR change, which is the result of fees changing from the initial good faith estimate and TIL. I do not know what is the official title of these two new staff positions, but we are nicknaming them the "TIL Queen" and the "Gatekeeper."
The "TIL Queen" will look at the application which includes a good faith estimate and truth-in-lending from the broker, then she will ASAP get the lender's own TIL and other disclosure documents out to the borrower, via email or however is the quickest method the borrower can manage. This becomes the official TIL, whether it varies from what the borrower received from the mortgage originator or not. Lenders may pad and estimate costs high to the extreme, just so they will not have to re-disclose and slow down the closing later if something changes to the high side.
If things change to the low side, which is the case more often than not on my loans, then there is no re-disclosure or interruption. I plan on following suit, to a reasonable extent, and try to disclose high---one example would be disclosing that the borrower would have 30 days prepaid interest rather than 15, which usually splits the month with a middle date estimate. Prepaid interest is what is paid in advance at closing, and that is why a borrower's first monthly payment skips a month.
The "Gatekeeper" will get the fun job of killing or delaying closings with a last-minute review for compliance.
Ironically and unfortunately, the actual Truth-in-Lending form that we are talking about is probably the most confusing and misunderstood document among all the disclosures you will be asked to sign. When we meet to get your loan going, just ask me if you have a question about this----it is too much to go into here.
As you may infer, I am taking a glass-half-full view here. Mortgage guidelines have been changing at a rapid rate for the last two years. It is much to keep up with. Mortgage market conditions make it more important than ever for a home buyer or home refinancer to work with someone they can trust to tell the truth---from Day One.
If your closing gets delayed or your loan takes longer to close because of this and other new guidelines, please remember that it is part of a bigger plan to raise standards and truly put truth in lending.
(Check out http://brentwoodhomeloan.com. Mortgage Planner Gary Moore produces Tips from the Trenches, copyright 2002-2009, designed as a resource for consumers and for Realtors who seek ongoing improvement, from the perspective of business partner and teammate. Contact me at 615-579-8658 for group or personal training and to pre-approve your prospects into the program which best serves their unique picture.)
Weekend Market Update
Aug. 1-2, 2009
Stocks ended July as one of the strongest months ever for major indexes, and interest rates softened in the last week of the month---a “combo plate” that usually does not get served up by the markets. Strength in stocks usually correlates with weakness in Treasuries and mortgage-backed securities, and vice versa.
The Gross Domestic Product for the second quarter showed the economy shrank 1%, which was below analysts’ forecasts, and thus supported stocks. The GDP for the first quarter was revised to a decline of 6.4%.
Dow stocks rose cumulatively 725 points in July, or 8.6%, for the large-cap index’s best month since October 2002 and its best July since 1989. The S&P 500 is knocking on the door of the 1,000 level and had its strongest July since 1997.
Despite stocks favoring the “less bad” is good news scenario, there is plenty for the market to worry about, such as unemployment and the still weak housing market. Unemployment is at 9.5%, a 26-year high, and the Federal Reserve estimates it will hit 10% before the year is out.
The 10-year Treasury closed at a yield of 3.5%, a mark around which it has been hovering for most of July.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.25% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
6% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"The modern mind dislikes gold because it blurts out unpleasant truths." - Joseph Schumpeter
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.
Weekend Market Update
July 25-26, 2009
“Less bad” is the new good for the housing market, which continues to display weakness but at a slowing pace. The rate of house price decline is slowing, inventories are declining and affordability is the highest ever.
Continuing to weigh on the housing market, however, are job losses, increasing numbers of foreclosures and soaring delinquencies.
Major stock indices closed at fresh highs for 2009 on Friday, despite heavy selling in Microsoft after the software behemoth reported quarterly sales that were short by a $1 billion of analysts’ estimates. It was the first-ever decline in annual sales of the Windows operating system. Microsoft’s selling influenced other tech stocks and caused the Nasdaq to break its 12-session streak of successively higher closes.
The Nasdaq runup was the longest unbroken string of gains since 1992. For the week all major indices---the Dow, S&P 500 and Nasdaq---were higher by about 4%. Alan Blinder, former vice chair of the Federal Reserve, chipped in his two cents worth that the economy has bottomed.
The Dow and S&P hit closing levels last touched in early November, 2008. The S&P recorded a 12-year closing low on March 9 at 676.53. It is up 44.7% on the year, and closed Friday at 979. The Dow is up 39% for the year and closed at 9,093.
The 10-year Treasury closed yielding 3.67%. Mortgage rates have been under slight upward pressure this week as money moved into stocks and away from Treasuries and mortgage-backed securities.
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
6% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
“When a person can no longer laugh at himself, it is time for others to laugh at him.” --Thomas Szasz
Visit my real estate website:
http://www.REALCarte.com
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower)
Weekend Market Update
July 11-12, 2009
Stocks had their fourth down week in a row, and money moved into low-yielding but safe instruments, which created a favorable environment for interest rates. Now is a good time to lock a rate, it seems. If you do not already have your application in position, do not procrastinate.
The poor economic environment, weak commodity prices and high unemployment continue to weigh on the markets. The volatility index, sometimes called the measure of fear in the market, has risen to 29, which is a mid-range level that is often crossed on the way up or down. Its read was below 20 in September, and it rose to about 80 during massive selling in November.
The 10-year Treasury closed at a yield of 3.3%, vs. 3.5% a week earlier.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
5.75% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Where all think alike, no one thinks very much." - Walter Lippmann
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
July 4-5, 2009
A downtrodden global economy continues to dominate market themes and keep a lid on inflation and interest rates, despite flurries of optimism that have lived on a thin diet of economic news trending from awful to less awful.
On Thursday the Labor Department reported that nonfarm payrolls decreased by 467,000 in June, and national unemployment now stands at 9.5%. The stock market declined sharply on the news. When compared to the average recession from 1954-2006, the current job market has suffered losses that are nearly three times as much as average, according to www.chartoftheday.com. In fact, if this were an average recession and job loss cycle, the number of jobs would have begun to increase three months ago.
The stock market has been unable to advance, and, in fact, has lost ground over the last three weeks, after coming off March 9 low to advance by about 30% from then until June 11. This year's highs were registered in the first trading days of January, and the market has been unable to break through that level.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo Fixed
5.75% $417,001-$1,000,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.25% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"If a man is offered a fact which goes against his instincts, he will scrutinize it closely, and unless the evidence is overwhelming, he will refuse to believe it. If, on the other hand, he is offered something which affords a reason for acting in accordance to his instincts, he will accept it even on the slightest evidence." - Bertrand Russell
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 27-28, 2009
The Fed met this week and said they will keep buying boat loads of mortgages; that's good news for borrowers and should continue to hold down mortgage rates in this historic time of extremely low rates and suppressed real estate prices.
The buyers do seem to be coming out, and it's about time. If you ever want to buy real estate, now is not the time to be on the sidelines. First-time buyers and anyone who has not owned a home in three years can get an $8,000 check from the U.S. Treasury if they show up before December. The mortgage game has never been more complicated, however, so please call me as soon in the process as possible to get you positioned for the greatest possible success as a homebuyer or investor.
Next week's trading is shortened as markets will close on Friday ahead of July 4, which falls on Saturday.
One piece of news this week, which has nothing to do with real estate or mortgage rates, is the expected sentencing on Monday of confessed swindler Bernard Madoff for running a $65 billion Ponzi scheme.
The 10-year Treasury closed at a yield of 3.51%, and could likely dip under 3.5% next week, as Treasury Department auctions which we foreshadowed last week found plenty of takers.
For Realtors who have listings in the jumbo (over $417,000) range, call or email me, and I can give you some scenarios, flyers or other help in getting your properties sold. I have some good jumbo products now, which require no escrows and no PMI. Some of my interest-only jumbo products look tempting, too. Call me.
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo 5/1 ARM (15% down, No MI)
5.2% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"One thing is sure. We have to do something. We have to do the best we know how at the moment... If it doesn't turn out right, we can modify it as we go along." - Franklin D. Roosevelt
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 20-21, 2009
Major stock indices were down for the week, and markets next week will be looking for clues from housing data and the Fed's statement about interest rates and the economy after the FOMC meeting.
Mortgage rates were choppy within a narrow channel this past week, but the path of least resistance is now up. Lenders are suddenly boasting that their underwriting times are much less than earlier this year when record mortgage volumes choked their pipelines. The only reason their turn times are down is that loan volumes have dropped as mortgage rates have gone from absurdly low to merely still in the range of historic lows.
On fewer radar screens than what the Fed does, but impacting on interest rates, the U.S. Treasury's $104 billion worth of bond auctions next week could also keep markets on edge. Worries about supply have weighed on the U.S. government bond market, with $2 trillion worth of new debt expected to be issued this year. To sell the paper it has been printing to try to float the economy out of the toilet, at some point the Treasury may have to raise rates to attract enough buyers. Yields rise as bond prices fall. Mortgage-backed securities correlate, generally, with Treasury issues, and mortgage interest rates rise or fall with the fate of mortgage-backed instruments.
Homebuyers and refinancers continue to have an extraordinary opportunity to take advantage of this market. Contrary to the impressions of some, there are many accessible and accommodating mortgage products. Niche products offer special advantages---such as 100% Rural Housing Loan with no MI, 100% VA loan with no MI, all FHA products and even jumbo loans (with no escrows and no MI) from our portfolio sources.
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo 5/1 ARM (10% down, No MI)
5.2% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"There is nothing more powerful than an idea whose time has come." - Victor Hugo
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 13-14, 2009
Treasuries and related instruments made a comeback on Thursday and Friday and reversed the recent rise of interest rates.
The quarterly Fed flow of funds report showed that U.S. consumers may be purchasing more Treasury debt than imagined, as household savings increased and tilted toward fixed income instruments. Conventional wisdom is that foreign central banks buy the Treasuries that cover most of the money the U.S. is printing, but the flow of funds report shows that American consumers are saving enough to fund the debt.
The report also showed that household holdings continued to drop in the first quarter as net household asset value dropped $1.3 trillion and home equity value dropped $450,000 billion. Some market watchers viewed this with a positive slant, however, as the fourth quarter of 2008 was much worse when households lost $4.8 trillion and $673 billion, respectively.
When the Treasury's auction of 30-year bonds brought plenty of buyers this week, related markets breathed a sigh of relief, thus turning mortgage rates and Treasury yields back down to end the week. The 10-year Treasury note closed at a yield of 3.79%, which was down week-over-week.
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo 5/1 ARM (10% down, No MI)
5.2% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
If you pick up a starving dog and make him prosperous, he will not bite you. This is the principal difference between a dog and a man.
-Mark Twain
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 6-7, 2009
Mortgage interest rates continued to trend higher on Friday, with most lenders raising their rate pricing twice intra-day. The 10-year Treasury note closed yielding 3.86%, its highest mark since early November, just before long-term mortgage rates dropped sharply. The 30-year bond closed yielding 4.66%, its highest yield since last July.
With money moving into stocks---and with new Federal debt issues competing with Treasuries and mortgage-backed securities for investors---there was only one way for mortgage rates to go.
The stock market is wanting to move higher and is looking at any news as a glass half full and an excuse for buying equities. Major stock indices closed higher for the third week in a row, but Friday's trading was choppy. The government reported about 345,000 jobs were lost in May---about half as many as were being eliminated earlier this year---but the unemployment rate rose to 9.4%, the highest in 25 years. Some market watchers took the report as a sign of an economy ready to turn the corner, going with a bad-but-getting-better scenario.
As we noted in last week's Market Update, we appear to have seen the lows in rates for homebuyers and home refinancers in this market cycle.
Anyone contemplating a purchase or refinance at this time should contact me right away to devise a strategy for getting the best possible rate pricing, so we can catch the market while still in its range of historical lows.
The Securities and Exchange Commission charged former Countrywide CEO Angelo Mozilo and the company's chief financial officer and chief operating officer with fraud for telling investors everything was hunky-dory at the mortgage behemoth while emailing among themselves that some of their 80/20 subprime products and their pay-option ARM were "toxic" and "dangerous." In a pay-option ARM, a borrower may pay less than the accrued monthly interest, thus creating negative amortization, or a loan balance that increases instead of going down. Mozilo was also charged with insider trading for unloading $140 million in Countrywide stock before it crashed. Here is a link to that story: http://www.economist.com/finance/displaystory.cfm?story_id=13805607
Countrywide no longer exists, having been swallowed by Bank of America for---gulp---$4.1 billion.
30-Year Conventional Fixed
5.375% $200,000-$417,000
FHA-100% VA
5.75% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
6% $100,000-$417,000
30-Year Jumbo 5/1 ARM (10% down, No MI)
5.2% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"To keep a lamp burning we have to keep putting oil in it." - Mother Teresa
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
May 16-17, 2009
Stocks took a breather from their two-month streak off March lows. The 10-year Treasury closed at a yield of 3.12%. Mortgage rates continue in a range of historic lows. Bad news about auto plant closings and dealer closings dominated headlines.
We are still unwinding all the ill effects of the economic debacle, but market watchers are choosing to focus on evidence of a slowing pace of bad news, rather than the stark numbers of unemployment or other government reports. Consumer confidence surveys are turning up, and consumer spending accounts for two-thirds of the U.S. economy.
Stocks could be in for choppy action in the week ahead. If money flows from stocks to Treasuries and mortgage-backed securities, it could serve to hold down mortgage interest rates in the near term.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 5/1 ARM (10% down, No MI)
5.2% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"What experience and history teach is this--that people and governments never have learned anything from history, or acted on principles deduced from it." - Georg Hegel
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
May 9-10, 2009
Stocks continued their two-month rally off the March 6 bottom as 19 banks passed the government’s stress test, and jobless claims were regarded as bad but not worse. Mortgage rates were pressured up, with intra-day pricing revisions from lenders, as money moved into stocks and out of Treasuries and mortgage-backed securities.
The market for equities is wanting to move higher, using any excuse and finding the positive in any government data. The April jobs report on Friday showed that non-farm employment fell by 539,000, which was less than the expected 600,000. The unemployment rate rose to 8.9%.
Good news in stocks is often bad news for Treasuries, mortgage-backed securities and mortgage interest rates. Treasuries continued to be sold, thus dropping in price and rising in yield. The yield curve is steepening, and at Friday’s close the 10-year was yielding 3.29%, and the 30-year was yielding 4.27%. The 10-year is yielding its highest rate since November, about the time mortgage interest rates began to tumble hard. Mortgage rates this week moved like a low-slung, kiddie roller coaster, rising and falling but within a narrow range of ups and downs, until Friday’s pop up.
In the past week, more than $70 billion was auctioned by the Treasury, which had an effect of holding down prices/pushing up yields as massive supply had to be priced to get absorbed. The Fed will be doing the reverse next week--- with buybacks of bonds scheduled for Monday, Tuesday and Thursday. Next week’s action should serve to continue to hold down mortgage interest rates.
Anecdotal evidence from my Realtors and others indicates we are experiencing an upturn of activity. Data from the National Association of Realtors indicates that about half of all buyers are first-time homebuyers, who can get a gift of $8,000 from the government just for buying a home---while rates are extremely low and prices are depressed---by the end of November this year. When first-timers buy, it sets off a potential ripple effect up through the market, as those who sell to first-timers can free up their equity for another purchase, and so on, up through various levels of move-up properties.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 5/1 ARM (10% down, No MI)
5.2% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"The great merit of gold is precisely that it is scarce; that its quantity is limited by nature; that it is costly to discover, to mine, and to process; and that it cannot be created by political fiat or caprice." - Henry Hazlitt
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
May 2-3, 2009
The 10-year Treasury closed at a yield of 3.12% on Friday, its highest point since Nov. 24, 2008, about the time that mortgage interest rates began their avalanche to record lows. This and other market action could be signaling that the bottom has been put in for low mortgage rates, and that stocks are getting consistent---if not vigorous---support.
The Federal Open Market Committee met this week and did not change its rock-bottom (0%-.25%) Fed funds rate. The Fed did reiterate the theme of economic weakness on Wednesday, but said while the economy is continuing to decline, the rate of decline may be slowing. When the Gross Domestic Product report came out on Wednesday, prior to the Fed meeting, it contradicted the Fed's announced theme as fourth-quarter GDP fell at an annual rate of 6.1%, while market watchers were expecting a 4.7% decline.
Thirsty for good news---even if it sounded like just less bad news---major stock indices closed up week-over-week for the seventh time in the past eight weeks. When markets trade in a direction opposite the common logic of the news---or when they move on the most flimsy of evidence or if markets seem to pick and choose---it is a confirming signal of direction.
Bond markets may be looking ahead to next week when the government will sell a record $71 billion in debt, in the form of two-year, 10-year and 30-year Treasuries in its May refunding.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
4.6% $417,001-$900,000
(Interest-only available-Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"The charm of history and its enigmatic lesson consist in the fact that, from age to age, nothing changes and yet everything is completely different." - Aldous Huxley
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
The Next Train Wreck
By Gary Moore
Mortgage Planner
Two things I do:
1—Find good news you can use, showing practical ways that homebuyers and homeowners can use mortgage programs and strategies to their advantage.
2—Tell you the truth, and tell you first---sort of a “you heard it here first” of the loan biz.
Today’s good news: I have a new Jumbo program---$417,001-$2,000,000 with good rates---5.75% for a 30-year fixed and 4.75% for a 5/1 ARM. Jumbo rates spiked two years ago as mortgage buyers ran like a scalded dog away from those loans.
Yesterday’s good news: Last week I told you about the new “Refi-Plus,” which enables a homeowner to refinance, even though his or her value has dropped and the appraisal is too low to refinance under normal loan guidelines.
Now that you are softened up, I must say that today we are down with some tough truth: The next train wreck in the mortgage business---as if we need a new one---is appraisals.
Three new things about appraisals: Home Valuation Code of Conduct, the Market Conditions addendum and Fannie Mae and Freddie Mac going to FHA-like standards for repairs.
Home Valuation Code of Conduct (HVCC)
We can no longer order appraisals or chose an appraiser---or speak to an appraiser, according to this new guideline, which I predict will be short-lived.
For conventional loans, there must be no contact between a mortgage originator or processor---no one from the mortgage company---and an appraiser, in an effort to thwart possible fraud conspiracies between mortgage people and appraisers. Appraisals must be ordered by the lenders, not your mortgage company, so that there can be no appearance of an appraiser being influenced.
There is already an industry movement underway to scuttle this program, and there will probably be some lawsuits. Some of my lenders say they are ready to ditch the program at the excuse of seeing the first lawsuit.
Here is what this means and what will change:
1---The appraiser cannot call me before going to a property and say, for instance, “I can’t find comparable sales to support the value you are looking for. Do you want me to go ahead with the appraisal, or stop before your customer is out the expense?”
2---After receiving an appraisal for which there are repairs, I cannot call the appraiser to ask a question or to ask for a clarification.
3---If I get a low appraisal, I cannot call the appraiser with comps.
4---On a refinance, the mortgage company cannot provide the appraiser with a targeted value. So, the appraiser does not what amount that he or she should attempt to support. Appraising is a blend of art and science, after all.
Those are some practical limitations that I will be aware of---or any mortgage originator---in communicating and in making a loan go smoothly.
The Realtor and the buyer will not like that this step will add about a week to the loan process, I predict.
The appraisers may not like it, because their fees will be cut.
Customers will not like it, because appraisals will cost more.
Large corporate giants---known as Appraisal Management Companies---such as Fiserv, LSI and Equifax will be ordering the appraisals, and making their cut---which is why the appraisers may actually get paid less for their work, and which is why borrowers may pay more.
Appraisals will be paid for in advance by the customer’s credit card. Someone from the AMC will call the borrower after the loan goes into processing and get the credit card payment.
You can put the HVCC in the category of punishing all to curtail the few.
On the plus side, this applies to conventional loans but not FHA and VA.
Market Conditions Addendum
All appraisals must now include the “Market Conditions Addendum.” The appraisers must analyze up to three years of data to quantify declining values in an area. The appraisers have to analyze this stuff up one side and down the other, including reams of explanations, an absorption rate analysis, days on market analysis, details about pending sales and existing listings, at least two comps within the last 90 days, and more. The idea behind this is a fear that values are declining so rapidly, old comparable sales are out of date and unrealistic.
In the next to last paragraph of the four-page directive, it says that HUD has complied with the Paperwork Reduction Act in putting out this announcement. Ya think?
My most efficient appraiser said that the first one of these addendums he did took him five hours to complete.
The appraisers also say that this will not affect their ultimate finding of value---that the comparables are still what they are. Yeah, and I can fly over the moon.
Bottom line: Values will be less.
More Repairs on Conventional Loans
FHA lightened up on repair requirements three years ago, but an FHA appraisal still requires that all utilities be turned on, and it will require the repair of certain things that pertain to “livability.” Conventional guidelines are now instructing appraisers in the same way.
Weekend Market Update
April 18-19, 2009
Mortgage interest rates were pushed in both directions this week but remained in the ongoing range of historic lows. Strengths in stocks and commodities---including copper and oil which moved back over $50 a barrel---went against a low-rate scenario at the end of the week, while reports of continuing economic weakness made a case for low inflation and supported low rates.
The most impacting news early in the week for bonds and mortgage rates were two government reports: The Commerce Department said that sales at retail establishments in the U.S. fell 1.1% last month. The second report was March's Producer Price Index (PPI), which fell 1.2% when it was expected to remain unchanged from February's level. Market watchers had expected better results for both sets of data. This eases inflation concerns and makes bonds and mortgage-backed securities more appealing to investors.
Later in the week, when earnings reports from major corporations were not so gloomy as had been imagined and when the University of Michigan’s consumer sentiment index showed an upturn, it put wind in the sails of stocks. After earnings reports from General Electric, Google and Citigroup on Friday, the market notched its sixth straight week of gains.
The 10-year Treasury closed at a yield of 2.93%.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
4.6% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
“We make a living by what we get; we make a life by what we give.” –Sir Winston Churchill
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
April 11-12, 2009
Stocks have risen for five weeks straight since the Dow and S&P 500 hit more than 12-year lows. In that time, the Dow rose 22%, its best five-week run since May of 1933 when it gained 31%. Is this merely a bear market rally, or has the market put in its bottom?
Making a case that we have seen the bottom is the fact that individual investors have begun putting money back into equities. Investors put $11.9 billion into stock mutual funds in the five-day period that ended April 8, after adding $3 billion the previous week.
Market watchers next week will focus on earnings coming in from major U.S. corporations, and a steady stream of poor first-quarter reports are expected. Traders will be looking to see which corporations appear to be hanging in there and which ones are in a strong down-spiral. More important to the market than the fundamentals and more news that things are in the toilet will be how the market reacts to news. Markets that react opposite to the news give a strong signal for future direction.
Mortgage interest rates remained steady last week, and the 10-year Treasury closed at a 2.93% yield.
The best good news in the real estate market is now old news, but it can be the mantra for the year: Rates are at historic lows, and the government will give you $8,000 free money if you buy a home this year and have not owned one in the past three years.
In the under-belly of the lending beast, lenders and government agencies continue to make life more difficult. After broad tightening that has gone on for more than a year and included requirements for higher credit scores, higher down payments and fully documented income, they are now tinkering with the appraisal process.
In order to comply with the new agency Home Valuation Code of Conduct, some lenders are requiring that they order all appraisals---taking that away from local brokers and appraisers---and that borrowers pay by credit card before appraisals are ordered.
Perhaps worse is the new requirement, as of April 1, that appraisers must complete a form that makes them do time-consuming computations and analyses of the market going back three years.
“It took me five hours just to do this one form,” one of my quickest and most efficient appraisers said. “I will get up to speed eventually, but they are requiring us to do statistics, which I haven’t touched since college. We have to show calculations of market trends and changes to value over three years.
“It does make you see that the numbers go with what we feel every day out in the marketplace---that values have widely dropped,” and by about 15%, he said, in a good area of a usually strong market, Hendersonville, where comparable sales were skewering my borrower with a $45,000 drop from one year ago.
While appraisers will say that these new requirements will not affect their estimations of value, because the comparable sales are the same no matter what, I have no doubt that the increased scrutiny will tend to depress values and appraisals further.
To recover its footing, the local real estate market needs to work through large inventories---at today’s absorption rate, or pace of buying, there is more than a year’s worth of inventory in many areas. Swelling these inventories and depressing prices are foreclosures, short sales and homeowners who have lost jobs or businesses and feel they have no choice but to sell their homes.
To accomplish that much clearing out of inventory, motivated first-time buyers will have to step up, take advantage of the government incentive and low rates and lead the market as they buy and in turn enable move-up buyers in a domino effect.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
4.6% $417,001-$900,000
(Interest-only available—Call me)
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"How hard it is, sometimes, to trust the evidence of one's senses! How reluctantly the mind consents to reality." - Norman Douglas
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
April 4-5, 2009
The Dow Jones stock average closed above 8,000 and completed a four-week upswing despite a government unemployment report that showed the U.S. lost 663,000 jobs in March. Stocks have bounced more than 21% in the last four weeks, but that measure comes against bear-market lows hit in March.
The U.S. economy has shed more than 5.1 million jobs since December, 2007. The unemployment rate is now 8.5%, the highest since November, 1983.
Money moved out of the relative safety of Treasuries, and the 10-year yield rose to 2.96% at Friday’s close.
Mortgage interest rates remain in a range of historical lows and present once-in-a-lifetime opportunities to buyers and refinancing homeowners. First-time buyers can get a gift of up to $8,000 from Treasury if they buy before December.
Loan guidelines continue to tighten, although I thought we were through with that at the end of 2008, when lenders and everyone had no less news and information about the market than we have today. Those of you who read my “Tips from the Trenches” advice column for Realtors and builders may recall a column I did in 2003 entitled “The Loan Candy Store.” At that time I cited loan programs that almost seemed too good to be true for borrowers who either had no downpayment or who could not document income.
As reaction to the mortgage debacle which began in the summer of 2007, lenders and government institutions have in some cases now swung too far in the other direction. Not only do loan guidelines continue to trend toward requiring more downpayment, higher credit scores, lower debt ratios and more thorough documentation of income, but the mortgage insurance companies have now gotten fully in the act and are killing loans that lenders and Fannie Mae guidelines accept.
So, in order to get a loan approved, we have to hit agency guidelines, the individual lenders’ overlays of further limitations and the MI companies’ guidelines which further tighten the rules. And, guidelines are changing from one day to the next. Do not expect that if you ask me a question on Tuesday that by breakfast on Wednesday the answer will still be good.
On the plus side, did I mention that rates are at scorching lows and that we have the experience and expertise to make things happen for many situations that baffle others?
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.4 % $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"The market can stay irrational longer than you can stay solvent."
- John Maynard Keynes
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
March 28-29, 2009
Mortgage rates remain in a range of historical lows and present opportunities for buyers and for homeowners wishing to refinance. The government's $8,000 gift to first-time buyers should ripple through move-up markets as sellers succeed and have use of their equity to buy up.
Wall Street capped a strong week on a down note on Friday as investors booked profits in the wake of the recent upward surge, and bank shares dropped after bank executives indicated March had been a tougher month for the industry than the previous two.
After a meeting with President Barack Obama, JPMorgan Chase Chief Executive Jamie Dimon said that March was "a little tough" in comments to CNBC. The bank's shares fell nearly 5 percent. Bank of America's top executive followed suit, saying the No. 1 U.S. bank's trading book lagged the two prior months in March.
The gloomy comments on bank profits contrasted with statements earlier in the month that had helped push the broad S&P 500 index up more than 20 percent since it hit a 12-year low on March 9.
The change in mood on banks compounded a sell-off as investors booked profits created during the recent run-up. Heading into the day's session, the S&P 500 was at its most overbought position since May 2008, according to its 50-day relative strength index.
The 10-year Treasury closed at a yield of 2.76%.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.25% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.4 % $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Men, it has been well said, think in herds; it will be seen that
they go mad in herds, while they only recover their senses
slowly, and one by one." --- Charles Mackay
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
March 14-15, 2009
Stocks racked up their best week since November with a four-day rally from extremely oversold levels as major indices rose about 10%. Coming off a closing bottom on March 9 of 6,547 in Dow Jones Industrial Average terms, the Dow closed Friday at 7,224. That is still below the Nov. 20 closing bottom of 7,552, which now serves as short-term overhead resistance for the current rally. Stock indices are still down about 18% for the year and down about 52% from their all-time high in October, 2007. Nothing in the technical action suggests that heavy selling is over or that a bottom has been put in, however.
Although money moved back into stocks for the week, investors did not abandon Treasuries and mortgage-backed securities as the 10-year Treasury closed at a yield of 2.89% and mortgage rates held steady in this historically low range.
Treasuries and mortgage markets started poorly in Friday morning trading, however, after comments by China had some traders believing the Chinese may begin to sell some of their massive holdings of U.S. debt. Since the Chinese hold about $727 billion of U.S. debt, or 6% of total outstanding debt, a selling campaign would drive prices lower and rates higher. This is the scenario I have persistently warned about for more than a year (if I say this long enough, I’m bound to be right some time!) which forces Treasury to hike rates to attract money to fund the federal debt, and that will signal the end of this historic run of cheap money. That’s only an opinion; of course rates will rise at some time---we just can’t predict when, and weakness in the economy is serving to hold down mortgage rates and fuel a refinancing boom.
The Federal Open Market Committee meets next week, and that line from the old Chubby Checker song, “Limbo Rock”---“How low can you go?”---is no longer valid as the Fed rate is already 0% for some lending and .25% for other instruments. Instead of handicapping the odds of a Fed move by a certain amount, market watchers will be listening for post-meeting comments or any new plans to bolster financial liquidity or boost the economy.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.5% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"True individual freedom cannot exist without economic security and independence. People who are hungry and out of a job are the stuff of which dictatorships are made."
-- Franklin D. Roosevelt
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
March 7-8, 2009
In this environment of continuing low interest rates and a tumultuous market, a strategy that has been working for conforming, refinancing homeowners is to get their loans in processing and get the appraisal done, but to delay locking interest rate pricing until after final approval and only days before closing.
We can lock for virtually any number of days at any time, but due to special incentives during March, our best borrowers are advantaged by getting their loans approved before locking. This presumes--right or wrong--that rates will remain approximately where they are now. This tactic was borne out of November's sudden drop in rates which prompted many borrowers to jump ship from one lender to another to get a better rate. To stop this, which costs lenders, some are pricing in incentives for committing to a lender at the outset of the loan process and then rewarding loyalty by the time to schedule closing.
On the other hand, I have been rushing to lock other loans and products just to beat guideline quicksand. Guidelines for some loan products are changing so frequently that what you contemplated today may not be possible tomorrow. FHA has lowered its loan-to-value for getting cash out, and most lenders have put in a minimum credit score of 620 for FHA loans, which were once blind to credit score.
Fear and bad news continued to swirl in the market this week as unemployment leaped to 8.1%, a 25-year high, and talk of a General Motors bankruptcy kept scared money on the sidelines. Short traders are overly influencing market moves, according to some analysts. And down the market has continued to move, peeling off years of appreciation in the process. Major stock indices are in the range of 1997. The Dow closed at 6,627 on Friday. Rallies have been short-lived and unsustainable. Technical analysis targets Dow 4,500-5,000.
The 10-year Treasury closed at a yield of 2.83%.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.5% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Not only our future economic soundness but the very soundness of our democratic institutions depends on the determination of our government to give employment to idle men." - Franklin D. Roosevelt
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Feb. 28-March 1, 2009
The only good news currently visible in the economy is low mortgage rates and the recently announced $8,000 gift for first-time homebuyers.
Not even the National Football League is immune to economic woes. The NFL said on Wednesday that the league dropped 169 jobs through buyouts, layoffs and other reductions. That was benign, however, when laid aside the week’s other economic news.
Stocks pushed to newer bear-market lows as an expanded federal rescue of Citigroup and a dividend cut for General Electric hit even more of their share values and the broader market.
In the last day of trading for February, traders did exactly what they had for most of the month, either selling out of or shorting large banking stocks. Pacing the day's decline, Citigroup closed down 96 cents, or 39%, at $1.50, after the Treasury Department said it is willing to convert as much as $25 billion of its preferred-stock holdings into riskier common shares. Preferred shares are generally less volatile and pay higher dividends.
Major stock indices dropped to 12-year lows during the week, cutting in half the market value from highs in October 2007. Lows reached in October and November of 2008 were violated, causing market technicians to predict another leg down. With extremely oversold conditions, it is likely the market will flatten out or rally before gathering steam for a significant, further decline, if that unfortunate scenario plays out. A Dow level of 4,000-5,000, last seen in 1995, would be the next level of long-term support, according to my amateur technical analysis.
Neither was there good news to find in the Commerce Department’s report that showed the economy contracted at a staggering 6.2 percent pace at the end of 2008, the worst showing in a quarter-century, as consumers and businesses ratcheted back spending.
The downhill slide in the final quarter of last year came as the financial crisis -- the worst since the 1930s -- intensified.
Consumers at the end of the year slashed spending by the most in 28 years. They chopped spending on cars, furniture, appliances, clothes and other things. Businesses retrenched sharply, too, dropping the ax on equipment and software, home building and commercial construction.
The nation's unemployment rate is now at 7.6 percent, the highest in more than 16 years. The Federal Reserve expects the jobless rate to rise to close to 9 percent this year, and probably remain above normal levels of around 5 percent into 2011.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.5% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658
"There is a mysterious cycle in human events. To some generations much is given. Of other generations much is expected. This generation of Americans has a rendezvous with destiny." - Franklin D. Roosevelt
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, subject to program and lock period. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Feb. 21-22, 2009
The U.S. government is aggressively goosing the real estate market by giving $8,000 to first-time buyers and by purchasing mortgages. The newly passed economic stimulus bill gives 10% of the sales price, up to $8,000, to first-time buyers, which is defined as anyone who has not owned a home in the last three years.
This is a change from the 2008 IRS code which gave first-time buyers an interest-free loan of $7,500 in the form of a tax credit and refund. The new ruling will give tax filers up to $8,000 in cash as a combo of credit against taxes owed and an outright gift beyond taxes owed—even for those who owe no taxes that’s a check for $8,000 from the U.S. Treasury.
In my workshop, “Shock Therapy for First-Time Homebuyers,” I describe first-time homebuyers as the base of the food pyramid of real estate. When first-timers buy, there is a ripple up the chain of real estate move-ups, and others are enabled to sell and buy up. First-time buyers historically represent more than 40% of all homebuyers.
FHA loans, which were once blind to credit score, are now available only to borrowers with 620 credit scores or better. VA and USDA Rural Housing can still be done with a score down to 580.
FHA cash-out loans over 85% are likely about to disappear, according to my sources.
Stocks sold off hard for the week as fears that some banks would be nationalized gripped the market and sent Citicorp and Bank of America stock reeling. The Obama administration tried to dissuade the markets that the government would swallow the banks, but that did not prevent Citicorp from dropping 22% for the day and closing at $1.95. If Treasury takes over the banks, holders of stock certificates will be left with nothing more than some unusual wallpaper.
Major stock indices are down about 47% from their October, 2007, highs, and this is the worst bear market for stocks since the crash of 1929.
Federal commitments to making mortgage money available are keeping a lid on rates. The administration said it was committing $400 billion, up from an earlier $200 billion figure, to buying mortgages.
Scared money staying away from stocks supported gold, Treasuries and mortgage-backed securities. Gold settled at more than $1,000 an ounce.
Inside the mortgage industry, the refinance boom, which has been fueled by record low rates for 30-year loans, is causing bottlenecks in underwriting and funding loans. My recommendation to borrowers—especially those who are refinancing—is to get me all their loan documents ASAP and let us get the appraisal done and the loan approved before locking a rate. Conventional pricing below reflects that scenario. Weekend Market Update informs on trends and news in the market and is not a quote for a unique borrower.
30-Year Conventional Fixed
4.75% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.15% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Let me remind you that credit is the lifeblood of business, the lifeblood of prices and jobs." - Herbert Hoover
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock, subject to program, except cleared-to-close on 30-year conforming refinance. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Feb. 14-15, 2009
NOTE TO REALTORS AND BUILDERS: Enhance your value to prospects by forwarding Weekend Market Update to them. It's also a good way to keep in touch and keep you in the pole position of their thinking about real estate. Print these and spread out at your open houses as a possible ice-breaker or converation starter. Leading questions to prospects: "Do you know where mortgage rates are today?" or "Do you like to keep up with interest rates and the markets?"
ANOTHER NOTE: If you have a listing outside Williamson or Davidson County---or a listing in Williamson County in Fairview, Thompson's Station, College Grove or Nolensville---please contact me to see if it is eligible for a USDA Rural Housing Loan. It could be your secret weapon to getting a buyer.
Bonds opened in negative territory and stayed that way through Friday's early market close ahead of the President's Day holiday on Monday. Mortgage rates were pressured upward in tandem with bond yields. Stocks were weak, too, as the DJIA closed down about 82 points at 7,850, its lowest close since Nov. 20. The 10-year Treasury note closed at a yield of 2.88% after Treasuries enjoyed a mid-week rally and mortgage rates in concert presented refinancing homeowners a window of opportunity to lock at 4.75%.
What could push rates up? Market players are wary of massive amounts of debt the Treasury Department will need to auction in the future to fund government bailout and stimulus expenditures. Treasury may have to increase yields on bills, notes and bonds-at some point, sooner or later-to attract foreign and domestic investors if the market gets flooded with an over-supply relative to demand.
Another factor that could pressure rates up is the prospect that stocks will rally when Congress and the President finalize the stimulus package. That would likely pull money from bonds and mortgage-backed securities and into stocks. We will have to wait and see on that one-that expectation may be a topic for conjecture for traders today, but the opposite view is that the stimulus bill in already priced into the market, and the finalization will not move markets and could spark sell-the-news action.
The University of Michigan Index of Consumer Sentiment was Friday's only relevant data on the schedule. It showed a reading of 56.2 that was well below forecasts of 60.2. This shows consumers were much less optimistic about their own financial situations than analysts had expected. That is usually good news for bonds and mortgage rates because it indicates consumers are less likely to make large purchases in the near future.
Mortgage world is currently rattled by the flood of refinances which have been slammed against lenders who have trimmed staff to brace for continued slow times. There is a way to "game" this market and win, be you a refinancer or buyer of a home or investment property. I have the way to do it. It involves having the self-discipline to listen to good advice and following it, rather than applying the thought processes and logic you have learned from the rest of the world, which has no correlation to the way this market behaves.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.15% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"O gold! I still prefer thee unto paper which makes bank credit like a bank of vapour." - Calvin Coolidge
Visit my real estate website:
http://www.REALCARTE.com
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower. Reply to discontinue Update.)
Weekend Market Update
Feb. 7-Feb. 8, 2009
Showing their perverse nature, markets on Friday went against the news as money moved from Treasuries to stocks. The January jobless report was so horrid that investors believed it would spur Congress to approve the economic stimulus package. Stocks usually sell into bad news about the economy, and bonds usually benefit from signs of economic weakness and no inflation.
Major stock indices snapped a four-week losing streak after testing last fall's lows earlier in the week. The DJIA rose 217 points, or 2.7%, to 8,281 as 29 of its 30 components closed above the previous close. The 10-year Treasury continued to drop in price and rise in yield and closed the week at a yield of 2.98%.
The U.S. lost about 598,000 jobs last month, which was the worst showing in a third of a century, as the unemployment rate climbed to 7.6%, the highest in 16 years. About 3.6 million jobs have disappeared so far in a deepening recession.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.15% $750,000-$1,500,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"I don't want to make money. I just want to be wonderful."
-- Marilyn Monroe
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
How to Beat the Bank
in this Market
By Gary Moore
Principal Broker/Mortgage Planner
Here are some loan twists that represent special situations in a borrower's favor in this tumultuous market.
While most of the recent changes in Mortgage Land have leaned toward tightening, rather than loosening, there are plenty of good loan programs available. In the rubble of the market fallout are some buried treasures-some loans that "beat the bank," or that provide special advantages for certain circumstances.
Investment Buying
Refinance your primary residence to purchase investment real estate. With rates in a range of historical lows, your cheapest money comes from any loan on your primary residence. We can do purchase loans for investment property, too, but the rate will be a little higher, and the downpayment often will be higher than the equity requirement for refinancing your personal home-assuming you have plenty of equity to work with.
If you clear enough equity cash, or later put an equity credit line on top of the first mortgage, you can get fix-up money. Later, once you have the newly acquired property renovated, with the help of a new appraisal that is now higher than what you paid, put a refinance on it and pull some money back out.
HUD Foreclosures with $100 Down.
If I have pre-approved you for an FHA loan, you are pre-approved for this program with only $100 down. This applies to an owner occupant, not an investor. Whether you ultimately buy a HUD foreclosure or not, we can get you prepared for that. Also, I can help you negotiate to get closing costs paid from HUD as seller or any homeowner as seller.
Jumbo World
A 90% loan-to-value jumbo up to $800,000 with no mortgage insurance and no escrow required. The market for jumbos disappeared as an early casualty of the mortgage mess, but I have cultivated one direct investor that makes the jumbos attractive. Rates range from 5.45% for a 3/1 ARM to in the 6's for fixed rate loans of 15-30 years.
With conforming limits at $417,000 and with lenders and banks no longer willing to be in second position on a 90% combined loan to value-let alone the 100% CLTV of earlier this decade-these jumbos are very appealing. Even when the jumbos first tanked two years ago, many borrowers got a $417,000 max conforming loan and paired it with a second mortgage or equity credit line up to 90%. Those are gone, for the most part, although I have some ways to get that done on a case-by-case basis. Most banks won't exceed 80% CLTV with a second or HELOC now, and one will go to 85% CLTV with the right circumstances.
If you take the view that things will settle down within the next three years, do a 3/1 ARM at a low 5.45% rate and plan on restructuring later. Or, nail down safety and get a full-term fixed rate and have no worries. While the jumbos are always going to be at a higher rate than conforming, for these full-term, fixed-rate loans, the rate is not excessively higher-about 1% and, to boot, you avoid mortgage insurance and having to escrow.
If the Home is Just Not Selling
Rate and term refinances on properties one day out of MLS. Most lenders will not refinance a property that has been listed for sale within the past year. That rule has been around since the good ol' days. But, I have one who will. Many would-be sellers in this market are not selling, unfortunately, but they need some options to keep afloat. Here's one.
Buy a New Home before My Other Home Sells
This is a common lament of Realtors who represent builders of new homes-that they encounter plenty of folks who claim they would buy the new home, only if theirs would sell first. To help homeowners buy another property while the bargains are out there, I often structure financing which enables the new purchase to take place first and in an efficient and inexpensive manner. Call me for details.
Anything FHA.
Downpayment for FHA increased to 3.5% this year, but that's still a bargain, especially since many of the 100% conventional loans have dried up. Loan amount has jumped to $393,000 in our area, which opens FHA possibilities to a whole new world of properties.
Credit scores do not have to be so high for FHA as for conventional loans. No price hits for a score of over 600 with some lenders and over 620 with others. For conventional loans, pricing tiers start at 620, and below 620 won't even make the cut with most.
FHA Streamline, with or without Appraisal.
Loan to value can go to 97.75%. No qualifying, no credit score hits, so long as mortgage has been paid timely for 12 months. You can be out of a job and have a 400 credit score and still get this loan. If I do your FHA streamline, I will get you a refund of some of your initial upfront mortgage insurance, subject to guidelines.
FHA 15-Year
If you can handle the payment on a 15-year loan and if you can put 10% down, there is no monthly mortgage insurance on an FHA loan. Upfront MI may be reduced, too, and be as low as 1%. This applies also to refinancers who have 10% equity.
VA 100% Loan with no Monthly MI.
We will begin by getting your certificate of eligibility from VA. This not only works for purchases, but I have an investor who will do a 100% cash-out VA on a case-by-case basis. The veteran is exempt from paying certain closing costs. Of course, I always counsel my Realtors and buyers to get with me before writing the contract so that we can craft the language and determine the amount to get costs paid by the seller.
VA Interest Rate Reduction Loan (IRRL). A streamline refinance with a reduced upfront mortgage insurance premium. $417,000 max loan amount.
USDA Rural Housing.
This is the closest thing to VA for Everybody-a 100% conventional loan with an upfront MI but no monthly MI. Call me to see if your listing, or a property you are eyeing, is in the right zone for this. Most of Fairview and parts of Nolensville, Thompson Station and College Grove in Williamson County are eligible. All of Dickson and other counties are OK. $417,000 max loan amount.
Low Rates in Historic Range
Although rates have been trending slightly upwards over the past two weeks, we are still in a ridiculously low range. Buyers and refinancers can take advantage while the getting is good. I remember the time when as a Realtor and builder we would wish for the day when rates got back down to 10%, as we could really sell some houses then. With burgeoning Federal debt, I think it is inevitable that we will suddenly jump to a much higher interest rate environment at some time, and that time will be when Treasury has to raise rates to entice foreign buyers of government bills, notes and bonds.
Pay a Point or More to Drive Rate "Too Far" Down
In this market, if you pay a point or more to lower the rate, you get "too much" bang for your buck, or you get more than at any time before. This is a short-term anomaly in the market. Take advantage!
Lenders are nervous that loans could get paid off more quickly than they would like and thus would diminish the value of receiving loan payments over time. Paying one point up front may gain a borrower a half percent better rate, say, the difference between 5% and 5.5%; so, it pays for itself in two years, and beyond two years is a bonus.
In the past eight years I have done more loans than not with 0 points, 0 origination, in order to save borrowers' initial costs. However, if borrowers pay 1% upfront on a conventional loan, it usually has reduced the rate by .25%. Sometimes borrowers like that, for instance, if the seller is paying your closing, and sometimes not, if buyers are short on downpayment funds or want to hold back some resources for moving and redecorating.
Now is the time to take advantage of pushing low rates even lower and at a "clearance" price. Every borrower, every situation and every lender is unique, so call me for details that apply to your needs.
Tax Credit for First-Time Homebuyers
A first-time homebuyer is actually someone who has not owned a home within the past three years. For any purchases between April 2008 and July 1, 2009, file for the $7,500 tax credit on your tax return. The IRS will send you a check or wipe off some of your tax obligations or a combination of both.
Even if you have no tax liability, they will send you a check for $7,500, or 10% of the sales price up to a limit of $7,500. You have to pay the subsidy back, so it's a short-term boost and an interest-free loan, repaid at $500 a year for 15 years. Some in the homebuilding and real estate industries are lobbying for the government to make it a gift that does not have to be repaid and to apply it to all homebuyers, not just first-timers. Oh, and listen to your CPA--not me--about any tax stuff.
(Check out http://www.REALCarte.com and http://www.BrentwoodHomeLoan.com. Realtor and Mortgage Planner Gary Moore produces Tips from the Trenches, copyright 2002-2009, designed as a resource for consumers and Realtors. Contact me at 615-579-8658 for free pre-approvals or for any questions.)
Weekend Market Update
Jan. 31-Feb. 1, 2009
Before we get into the market junk….and here in the metropolitan Nashville area, the overall good news for homebuyers and refinancers is not only that mortgage rates remain extremely low, but programs are available which make deals work, such as those priced below.
We have a jumbo investor whose pricing is favorable and with no MI (mortgage insurance) and with no escrow required. Certain 100% loans are available with no mortgage insurance for veterans and for buyers in certain pockets of Davidson and Williamson Counties and all of other counties through USDA Rural Housing.
FHA loans now go up to $393,000 in Davidson and Williamson with only 3.5% required down. There are a couple of ways to get to 100% through conventional loans or down payment assistance.
* * *
Down more than 8% since New Years Day, the Dow and S&P indices ended their worst January in history. Markets looked ahead for help from the proposed government stimulus package after digesting GDP figures that showed that the economy shrank at a 3.8% annual rate in the fourth quarter of 2008, which was the largest contraction since Q1 1982.
Mortgage rates dipped before the Fed meeting announcement and then popped up afterwards—a pattern often seen during this decade—adding evidence that we have seen the bottom in mortgage rates for this cycle. The good news for rates—continuing evidence of a weak economy and the government’s willingness to continue to buy mortgage-backed securities—was already priced into the market.
In the absence of anything new, Treasuries have been selling off since making extreme lows in December and hovering in a low range for much of January. Treasuries got to such an extreme in December that the 90-day bill at one point even traded in the negative—that is, someone not only did not receive interest but actually paid the U.S Treasury to hold their money. Treasuries have been dropping in price and rising in yield for the last two weeks. The 10-year closed at a yield of 2.84%, which represents its highest mark since Nov. 28.
The Fed did say that the government would continue buying mortgage-backed securities, which supports the mortgage market and effectively keeps a lid on rates. So, it appears rates will remain highly favorable for the foreseeable future. There will be more down and up days, but likely in a narrow range for the near term.
30-Year Jumbo 3/1 ARM (10% down, No MI)
5.45% $417,001-$600,000
30-Year Super Jumbo Fixed
6.15% $750,000-$1,500,000
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Over every mountain there is a path, although it may not be seen from the valley."
-- Theodore Roethke
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
The False Mystique of ‘Zero and Zero’
Jan. 26, 2009
By Gary Moore
Senior Mortgage Planner
Like other financial markets, things are so topsy-turvy in the mortgage market these days that you can throw out everything you ever knew or thought you knew.
It does not help if you are a genius, if you are a captain of industry or if you are highly expert and acclaimed in your field. The market does its own thing and scoffs at the public’s need to apply logic, individual experiences or cause-and-effect to its machinations.
Think like an investor for a moment.
Wrap your mind around the fact that refinancing or purchasing real estate is a part of your financial planning. You should give it as much thought as any decision about where to invest money. (Of course, these days, a good question is, do I have any money left to invest?) A refinance can be done to lower your monthly payment, or it can gain a homeowner some cash out for other needs.
As an investor, what if I showed you a sure thing, a way to return 50% every year? Are you interested?
Here’s my investment proposition wrapped inside a mortgage:
You invest $4,000. Over the next two years, your return on investment is $3,996, or basically 50% per year. The third year, with your initial investment already recouped, you receive $1,994. The fourth year, you gain $1,988, and so on.
Would you take that deal? I think so.
My “investment” example represents the effect of paying a point—one percent of the loan amount—on a $400,000 loan and bettering your interest rate by a half percent, so that your return is about 50% a year.
But if I told you to let go of “zero and zero” thinking—wanting the loan to have 0 points and 0 origination—many of you would balk.
You pay points and origination—they are the same thing, regardless of terminology--to affect the interest rate. For the cost of a point upfront, the borrower gets in return a better interest rate for 30 years.
Historically, 1%, or one point, paid up front bought you .25% in interest rate on a 30-year loan. In my example, if you have a $400,000 loan amount, 1% of the loan amount (AKA one point) is $4,000. In “normal” markets, that would be the difference between, say, a 5% rate fixed for 30 years and a 4.75% rate.
In our present tumultuous market, however, 1% up front may improve your 30-year rate by .5% or more—the difference between 5% and 4.5%. Thus the math of investing $4,000 today and recouping about $2,000 a year. If you are going to stay in the home more than two years, it’s a no-brainer. You break even in two years and beyond that is gravy.
However, many otherwise astute real estate owners and investors are hung up on a way of pricing loans that sounds attractive, and may have worked at one time, but which does not work in this market of wild swings and anomalies. What many perceive as a smart way to operate and a savvy way to negotiate mortgage pricing does not work well in this market. To proceed on this basis may actually backfire if you are not open to seeing the math.
To win in this market, do not be allergic to paying points to lower your rate to the extreme. If you do the math, it makes sense in a way it never has. As for the lure of getting a loan with no origination or discount points, that approach may be more mistake than mystique.
Probably half the loans I have done historically—purchases and refinances, and especially refinances where there is no seller to pay closing costs—have been done with 0 points and 0 origination charged. Whether to price loans this way or not depends partly on the market and largely on the borrower’s financial picture and objectives. On purchases, especially when the seller is paying closing costs, it helps my borrower to spend some of that closing cost money to get a lower rate and payment.
The fallacy of the public is that these costs are being perceived as strictly fees and that a smart mortgage consumer is going to avoid paying upfront fees. That’s fine, so long as you have done the math and made a smart choice. If you think paying no origination means you win and the mortgage company loses, your thinking is flawed.
Despite the logic of the unvarnished numbers, there may be a reason not to pay a point or more and get a “clearance” price on the interest rate. On a refinance, maybe the property will not appraise for enough to roll the 1% into the loan amount, and the borrower does not have enough money in the bank to pay it out of pocket. On a purchase, maybe the seller is not paying your closing costs—which is how I always encourage my buyers and Realtors to negotiate, for reasons I will explain if you call me—and you as the buyer are cash-strapped.
But, if you do the math, strictly from the point of view of what is a better “deal,” buying down the rate is a bargain in this market. There is no mystique to this—just math.
I’ll do the math for you on any purchase or refinance you contemplate, and you can decide. It makes no difference to me or my income; my objective is to serve your best interests, and you have the final say on that. However, if I do not show you that you have more beneficial alternatives, I have not served you in the high manner with which I identify.
At some point, the mortgage market will revert to the mean. That is, having been stretched like a rubber band in recent, violent swings, it will snap back to more normal mortgage pricing, and the bargain pricing of this winter will be gone.
Weekend Market Update
Jan. 24-25, 2009
Stocks ended a choppy week of trading amid an all-too-familiar
torrent of bad news about the economy---jobless claims rising, home sales down, jobs cuts at major corporations, corporate earnings declines, etc. Major stock indices were down about 2.5% for the week and have declined about 7% for 2009.
As troublesome as any news was the question of Britain's solvency amid demands on the British Treasury to rescue its entire banking system and economy. Nationalization of banks could be the next step and portends what could happen in the U.S.
Markets next week will be focused on President Obama's economic stimulus proposal and on the Federal Open Market Committee's meeting. With Fed funds already at 0 to .25%, the Fed will not change rates but may give the market some tea leaves to read in its post-meeting statement.
Treasury prices continued to decline as their yields rose in tandem with mortgage rates, which have been inching up. The 10-year Treasury closed yielding 2.62%, still ultra-low but its highest since Dec. 11.
Mortgage rates hit a bottom in December as the Fed was stepping in and buying mortgage-backed securities. With bad news in the economy continuing and with the government supporting mortgages and trying to drive rates down, why are rates firming? Some analysts believe that Fed-buying is already priced into the market and that the government has shown it can only influence interest rates to a limited extent.
On the plus side, mortgage rates remain at extreme lows, providing opportunities to homebuyers, investors and homeowners wishing to refinance to a lower rate or to get cash out to reduce other debt or fund projects. With there being a current refinance boom underway and lenders backed up in processing and underwriting, my best advice to buyers is to get your loan in processing for pre-approval so that you will be in position to best negotiate with a seller. For refinancers, same advice, get your loan fully documented and ready to close in order to take advantage of any short-term dips.
After losing its market share in mid-decade while 100% conventional loans flourished, FHA is now positioned as a market savior. With lower downpayment requirements than conventional loans, generous seller-paid closing allowances, tightened but still looser restrictions on credit score, and newly increased loan limits, an FHA loan could be the ticket for any sales into the low $400's.
30-Year Conventional Fixed
5.25% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300/$417,000
100% Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo
6.2% $417,001-$750,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"Fear always springs from ignorance." - Ralph Waldo Emerson
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Jan. 17-18, 2009
FHA loan limits have made a quantum leap in Davidson, Williamson and surrounding counties by rising to $393,300 from the former limit of $226,100. While last year’s recovery act temporarily increased FHA and conforming loan limits to $432,500, many lenders did not participate and others bumped pricing (adding points or raising rates) for FHA loans which exceeded the regular maximum. With this much higher limit not being a “special,” the best FHA pricing is now the same for all loan amounts over $100,000. The FHA minimum investment for a purchase is now 3.5%, up from the former requirement of 3% from the borrower.
Markets were choppy this week, with stocks sinking and the bond market treading water for the most part. Banks sold off hard on Friday after Bank of America and Citigroup reported massive fourth-quarter losses. However, BOA said it had reached a deal with the government to receive $20 billion in capital and guarantees to cover up to $118 billion in losses from real estate-related loans and securities.
Major stock indices ended Friday’s trading with a gain over the prior close but for the week were off by about 5.5%. Meanwhile, General Electric and several other large corporations announced they would be eliminating jobs to cope with the recession. Bankrupt Circuit City, unable to work out a sale of the company, said it will go out of business, closing its U.S. stores and cutting 30,000 jobs.
The Labor Department said the consumer price index fell 0.7 percent in December as energy prices slid. For the full year, prices rose just 0.1 percent -- the smallest gain since prices actually fell in 1954. In a separate report, the Federal Reserve said industrial production from the nation's factories, mines and utilities fell a larger-than-expected 2 percent in December.
The 10-year Treasury closed yielding 2.3%.
30-Year Conventional Fixed
5% $200,000-$417,000
FHA-100% VA
5.5% $100,000-$393,300
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$417,000
30-Year Jumbo w/no MI
6.2% $417,001-$750,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: 866-321-6513
"A bank is a place that will lend you money if you can prove that you don't need it." - Bob Hope
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
Good Loans ‘in the Flow,’ Despite Speed Limits
Jan. 16, 2009
By Gary Moore
Senior Mortgage Planner
Once when driving into a small town in the Ozarks of Arkansas, I got a speeding ticket. There is nothing new about small-town speed traps, or about my getting a ticket, but I was puzzled besides being pissed off by this one. I was sure I had not exceeded the posted speed limit.
As I tend at times to be hard-headed to a fault, the next day I burned some family vacation time to backtrack my route. I was amazed to find that there was a speed limit change every little bit, up and down and back—45 mph to 35 to 50 to 45 to 30 and so on--without any particular reason or change in the road or traffic.
Later during this trip, while driving down a really, really back road we saw an even more exaggerated example of this: there was a 40 mph sign and about 10 feet past it was a 30 mph sign. I am not making this up. (I don’t know which speed they intended on that remote, narrow road even the locals rarely used, and I don’t think that was a speed trap; I think that was the result of inbreeding, or shall I say more kindly, local culture.)
That little episode came to mind recently when I pondered the recent machinations of the mortgage industry. The ebb and flow of mortgage guideline changes—shifting from tighter to looser and looser to tighter—continues. I would pull out the cliché, “You need a scorecard to keep up,” except the scorecard changes before the ink dries.
For example, on May 5, 2008, FHA entered certain guidelines into the Federal Register which changed mortgage insurance premiums and how they were figured. Those changes, the 29-page entry said, would go into effect on July 14, 2008. Then, on June 11, 2008, FHA came out with an eight-page mortgage letter which changed everything. The “new rules” had not gone into effect yet before they were changed!
Here is a recent example of loan “flow:” A 100% cash-out VA refinance loan that I have cultivated with one of my lenders. Veterans could be well-served by this product.
Here is an “ebb:” FHA cash-out still goes up to 95% loan-to-value, but as of Jan. 1 it is necessary to have two appraisals if the LTV exceeds 85%.
More “flow:” We have cultivated a new investor that makes a jumbo loan---$432,500 to $1,500,000---feasible for the first time in more than a year at rates in the 6-6.5% range up to 90% LTV with no mortgage insurance and no escrows required.
“Ebb:” For an FHA purchase loan, the required investment from the buyer increased to 3.5% from 3% on Jan. 1. The seller can still pay closing costs and rate buy-downs.
“Flow:” The best flow for home buyers and sellers is the flow of Treasury and Fed money being printed and pumped into the economy, and that includes the money to back up purchases of first mortgages at record low rates.
There are still plenty of good financing programs to make sales possible—however, it is more important than ever to engage a conscientious originator who has expertise and access to a broad range of lenders and programs.
Weekend Market Update
Jan. 3-4, 2009
Although the stock market wrapped up its third worst year in history in 2008, equities have been working their way higher to form a bottoming pattern since late-November lows. The Dow Jones index fell 33.8% in 2008, ranking behind only 1907 (down 38%) and 1931 (down 53%). There was a major banking system crisis in each of those years.
Mortgage interest rates remain in a range of historical lows, but they also put in a bottoming pattern to end the year, rising slightly from the extreme low spike of Dec. 17.
Procrastinators need to get mortgage loan applications and supporting documents to me ASAP to get in position to lock a low rate and snag this historic opportunity to refinance. Don’t get complacent believing these rates are going to last forever. And don’t fall in the trap of “I saw a quarter point lower rate one day last month, and I’m waiting to see that come back.” That’s like saying, “I saw XYZ stock at $15 on Oct. 10, it’s a great buy at $18 now, but I’m waiting on $15 again.” If a refinance benefits you at these levels, follow through now. Look at your big picture.
Here’s a mortgage industry inside secret that is hard to convey to the public: Get your loan approved, get the appraisal done, and get the loan ready to close BEFORE I lock your rate. Lenders offer better pricing for a loan that is ready to close vs. a loan that is just getting started.
Ditto for prospective buyers: Get your loan documented fully now so that I can write a solid pre-approval letter and help you negotiate a better deal. Do not wait until you find a house you want to buy and then scramble as the Realtor writes a contract not knowing what loan program you need, what downpayment you truly have and if the seller needs to pay some of your closing costs.
You need to confirm your best financing approach so your Realtor can write the contract accordingly…..and for greatest impact, you need my pre-approval letter to be presented by your Realtor at the same time he or she presents the contract---not a week later.
This is one area where you can apply a pinch of self-discipline and set yourself up to save thousands of dollars over many years. Like many things in life, you prepare before the moment gets urgent. You fix the roof on a sunny day---not when it’s pouring rain. You may have heard me pose this question---Would you rather be standing at the station when the train pulls in? Or run chasing it down the tracks after it has pulled away?
30-Year Conventional Fixed
5% $200,000-$432,500
FHA-100% VA
5.5% $100,000-$226,100
100% Guaranteed Rural Housing w/no MI
5.5% $100,000-$432,500
30-Year Jumbo w/no MI
5.9% $432,550-$750,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"About the time we can make ends meet, somebody moves the ends." -- Herbert Hoover
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock, subject to program. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Dec. 6-7, 2008
We have cultivated a jumbo investor to fill a hole created by the mortgage crisis, which has scared off buyers of practically everything but government-backed loans. We can now do jumbo loans for solid borrowers at around 6% for a 30-year fixed rate loan. Call me at 615-579-8658 for more details.
Unemployment numbers hit multi-year highs and oil hit multi-year lows as stocks rose and Treasuries faded in Friday’s markets. Analysts made the case for perverse markets buying bad employment news in anticipation of more government measures to shore up the economy. The take on oil prices falling was more straightforward—consumers will have more money to spend now that it takes less to fill the tank.
Mortgage rates remained at extreme lows this week but turned up a bit late Friday as money moved from Treasuries to stocks. The 10-year Treasury note closed yielding 2.66%.
Light, sweet crude fell $2.86 to settle at $40.81 a barrel on the New York Mercantile Exchange. Concerns about the economy and weakening energy demand have kept oil prices near four-year lows. The price of oil has fallen a staggering 72 percent since peaking at $147.27 in July.
A government report showed that U.S. employers cut payrolls by 533,000 in November, the weakest performance in 34 years, while the unemployment rate rose to 6.7 percent, the highest reading since 1993.
The Dow Jones industrial average gained 259.18 points, or 3.09 percent, to end at 8,635.42. The Standard & Poor's 500 Index climbed 30.85 points, or 3.65 percent, to 876.07. The Nasdaq Composite Index rose 63.75 points, or 4.41 percent, to close at 1,509.31. The S&P index is down about 40 percent on the year.
Underscoring Friday's dismaying signs of a rapidly deteriorating economy, General Motors announced yet more job cuts, and a record number of homeowners were reported behind on mortgage payments or in foreclosure.
30-Year Conventional Fixed
5.125% $200,000-$432,500
FHA-VA
6 % $100,000-$432,500
100% 30-Year Fixed
7% (95% first mortgage w/1% discount) $100,000-$432,500
9% fixed 20-year second mortgage for 5% of home value
100% Guaranteed Rural Housing w/no MI
6.5% $100,000-$432,500
30-Year Jumbo
6% $432,550-$750,000
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"May you live in interesting times." - ancient Chinese curse
Visit my mortgage website:
http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Nov. 29-30, 2008
Mortgage rates hit the mid-5% range this week, presenting excellent opportunities for homebuyers and refinancers. In an atypical combination in which various asset classes flourished, markets brought Thanksgiving cheer to stocks, Treasuries and mortgage-backed securities.
The 10-year Treasury closed at a yield of 2.92%, which represents a drop from 3.96%, or more than 25%, for November and is an all-time historical low, so far as my data (back to 1962) reflects. Price on Treasury bonds and notes move inversely to yield, so when Treasuries go up and are being bought, the interest yield falls.
After touching lows last seen in 1997 only a week ago Friday, major stock indices booked the largest one-week percentage advance in more than 75 years. The stock market closed three hours early the day after Thanksgiving and locked in gains of 16.9 percent for the Dow since the rally began Nov. 21, 19.1 percent for the S&P 500 and 16.7 percent for the Nasdaq. It was the first time the Dow had risen for five consecutive sessions since July 2007 and was the biggest five-day percentage gain over five sessions since Aug. 8, 1932. For the S&P 500, it was the first five-day string of gains since July 2007 and the largest five-day percentage gain since March 16, 1933.
The market got boosts over the past week from President-elect Barack Obama naming his economic team, the government propping up Citigroup and the Federal Reserve deciding to buy massive amounts of mortgage-backed securities. These efforts sent mortgage rates plunging and reassured the market that broad efforts are still being made to fight the financial crisis that intensified in September with the bankruptcy of Lehman Brothers Holdings Inc.
What could stymie the rally, however, is if the holiday shopping period, which began in earnest Friday, turns out even worse than expected. Wall Street already anticipates that retailers will suffer as consumers— nervous about a difficult job market, lower home values and a jittery stock market—grow more restrained in their spending this year.
A rare drop in year-over-year holiday spending would be troubling, as it is the most important period of the year for most retailers and because consumer purchases account for more than two-thirds of U.S. economic activity. But while some stores around the nation appeared busy Friday as shoppers looked for bargains, the early evidence was anecdotal and Wall Street will have to wait for cash register tallies.
.
30-Year Conventional Fixed
5.5% $200,000-$432,500
FHA-VA
5.5 % $100,000-$432,500
100% 30-Year Fixed
7% (95% first mortgage w/1% discount) $100,000-$432,500
9% fixed 20-year second mortgage for 5% of home value
100% Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"A bull market tends to bail you out of all your mistakes. Conversely, bear markets make you pay for your mistakes." - Richard Russell
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Tips from the Trenches
Loans Old and New for this Market
By Gary Moore
Senior Mortgage Planner
Here are some programs—some brand new and some tried and true—to get your buyers, sellers and investors moving through this market:
1—100% conventional loan for PURCHASES and REFINANCES. The 100% conventional loans that soared along with the market earlier in this decade are dead. However, I have developed an investor who can get to 100% for any qualified buyer—does not have to be VA or Rural Housing—by putting a 95% first mortgage with a little second mortgage for the remaining 5%. The seller can pay closing costs.
A 100% loan for a refinance is unheard of, but this investor can not only bring the 100% loan for a buyer but also for a current homeowner who wishes to refinance. This could be a savior for someone whose subprime loan has adjusted to a high rate.
For these 100% loans the borrower needs a 680 credit score. Seller can pay 3% of sales price toward closing.
2—FHA is the “tried and true” part and is often not given a good look by mortgage people because most of them either don’t meet the requirements to be able to offer FHA or they think FHA is too tough for them.
Buyer puts 3% of his or her own money into the deal—and some of that can be closing costs and all of it can come from a family member—and seller can pay up to 6% of sales price toward closing or buying down the loan.
If you find a HUD foreclosure, the downpayment can be just $100.
Do you think FHA is only for a purchase? FHA offers the very best available cash-out refinance, up to 95% of value.
3—A 100% VA loan is the best loan around with no monthly mortgage insurance required. There is an upfront funding fee of more than 2%, depending on different variables. Rates are low and are essentially the same as FHA. Seller can pay closing and, in fact, certain charges are not allowed to be put to the veteran, such as attorney’s fees and lender fees.
VA is like FHA for many mortgage originators—they can’t handle it; it’s too hard and too mysterious. VA has its quirks like any loan, but we have the experience and know-how to get these smoothly closed. I have gotten many certificates of eligibility for veterans, and helped many get eligibility restored. Call me to help your veterans.
4—Rural Housing is another wonderful 100% loan product with no monthly mortgage insurance but rather a 2% upfront mortgage insurance premium. Call me to see if your listing—or the home your buyer is circling—qualifies. Many parts of Williamson County and other counties qualify for this and all of many Middle Tennessee counties—such as Dickson and Hickman—qualify for the program.
Despite the current market tone, there is still more than one way to skin a cat. It is an opportune time to be a buyer. Ask me to call your prospects to structure the best loan strategy. For your listings, call me to work up Open House Kits and financing scenarios to help prospects envision themselves moving in.
(Check out http://brentwoodhomeloan.com Mortgage Planner Gary Moore produces Tips from the Trenches, copyright 2002-2008, designed for Realtors who seek ongoing improvement, from the perspective of business partner and teammate. Bringing experience as a Realtor, Homebuilder and PR advisor, I seek to help you build your business and enhance your value to customers by providing specialized resources, training and insights. Contact me at 615-579-8658 for free group or personal training and to pre-approve your prospects into the program which best serves their unique picture.)
Weekend Market Update
Nov. 15-16, 2008
Prospects of weak consumer spending continued to set the tone for the markets on Friday as the government reported a surprising drop in retail sales, and money moved from stocks to Treasuries. The October Retail Sales report's drop of 2.8% was a larger decline than was expected, the fourth consecutive monthly drop and the largest monthly decline since January 1987. This indicates that the economy is still softening, which is good news for the bond market and mortgage rates.
Stocks sold hard in morning trading, then rebounded in early afternoon, before rolling over to end the day broadly lower. A slew of fourth-quarter warnings quashed any potential for a continuation of the rally, and companies reporting lower-than-expected earnings or issuing guidance lower included retailers Nordstrom, J.C. Penney, Abercrombie and Kohl's and phone maker Nokia.
The 10-year Treasury closed at a lower yield, 3.75%. Mortgage rates remain low and, along with bargain real estate prices, make this a favorable time to be a buyer.
30-Year Conventional Fixed
5.875% $200,000-$432,500
FHA-VA
6.25 % $100,000-$432,500
103% 30-Year Fixed
6.75% (first mortgage w/1% discount) $100,000-$432,500
8.75% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
7% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Good advice is something a man gives when he is
too old to set a bad example."
-Francois de la Rochefoucauld
Visit my real estate website: http://www.REALCarte.com
Visit my mortgage website: http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Nov. 1-2, 2008
Stocks stabilized in a week in which the Fed cut its Fed funds rate by a half point and GDP numbers showed the U.S. economy is officially shrinking. For the first time since third quarter 2001, GDP dropped, showing a 0.3 percent decline from the prior quarter. Given the recent declines in consumer confidence and employment, there is likely to be further contraction in the fourth quarter and into 2009.
After extreme volatility and massive washout selling earlier in October, the stock market seems to have priced in the future bad news it expects about the economy and continues to lift off its bottoming pattern, which we called in the Oct. 11-12 Weekend Market Update. As money moved into stocks, it flowed out of Treasuries and mortgage-backed securities, sending yields and mortgage rates slightly higher.
The 10-year Treasury closed at a yield of 3.97%. The Fed funds rate is now at a record low of 1%, last seen in the June 2003-July 2004 period. The prime rate is now at 4%, or Fed funds rate plus a margin of 3%.
Look for mortgage rates to pull back a bit lower in the short term after this week's mostly upward pressure. In the long term, mortgage rates are still subject to inflation expectations and the government's costs of borrowing to pay off massive debt. At some point we can expect that the Treasury will have to increase its yields to entice foreign investors to buy our paper.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.5 % $100,000-$432,500
103% 30-Year Fixed
6.75% (first mortgage w/1% discount) $100,000-$432,500
8.75% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
7.25% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"History is a vast early warning system." - Norman Cousins
Visit my mortgage website: http://www.BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower. Reply to discontinue Update.)
Weekend Market Update
Oct. 25-26, 2008
Volatile markets were the theme again this week, although global developments to add liquidity helped institutions borrow from each other. In the U.S., markets were guided lower as unemployment continued to rise and other economic data continued to indicate a recession.
The Libor (London interbank offered rate) fell to the 3.5% range this week, off its high of just under 5% earlier this month. Stock market indices are down more than 20% for the month, which is setting up October to be the worst month for stocks since October 1987.
Mortgage rates held in a narrow range, and excellent programs for buyers and refinancers persist at low rates. The 10-year Treasury closed at a yield of 3.7%.
The Federal Open Market Committee meets next week, and Fed funds futures are pricing in a drop of .5%. If that happened, Fed funds would drop to 1%, which was a low last seen in 2003, and prime would drop from 4.5% to 4%.
30-Year Conventional Fixed
6% $200,000-$432,500
FHA-VA
6.25 % $100,000-$432,500
103% 30-Year Fixed
6.75% (first mortgage w/1% discount) $100,000-$432,500
8.75% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Shallow men believe in luck. Strong men believe in cause and effect."
- Ralph Waldo Emerson
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Oct. 18-19, 2008
Stocks were choppy on Friday to close a week of whipsaws in the market, and money flowed out of safe-haven Treasuries, even as market news added evidence of a weak economy. Mortgage rates eased slightly for the week but Treasury yields remained under upward pressure.
The Commerce Department reported that housing starts fell more than 6 percent in September to an annual rate of 817,000 units. The figure is lower than the 880,000 units forecast by Wall Street economists and is the slowest pace since 1991. Consumer sentiment dropped in October in a record single-month decline to a reading of 57.5 vs. 70.3 in late September, according to the University of Michigan index released Friday. Also this week, the government reported that retail sales fell 1.2% in September, marking the worst drop in three years and the third monthly decline in a row.
Although mid-week selling in stocks closed the gap between's last Friday's close and the open on Monday, when the Dow jumped ahead 936 points by the day's end, this week's lows held above the lows set in last week's cathartic selling. That market action affirmed our technical observation on Oct. 10 of a bottoming pattern etched out on that day.
30-Year Conventional Fixed
6.125% $200,000-$432,500
FHA-VA
6.25 % $100,000-$432,500
103% 30-Year Fixed
6.875% (first mortgage w/1% discount) $100,000-$432,500
6.875% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
7% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"When future historians look back on our way of curing inflation they'll probably compare it to bloodletting in the Middle Ages." - Lee Iacocca
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Oct. 11-12, 2008
On the heels of the week's panicked selling in stocks, finance ministers and central bankers from the Group of Seven meet in Washington this weekend to discuss jammed credit markets and the staggering global economy. Investors will be awaiting the outcome of those meetings to see if the central bankers make any moves the market likes.
This week's coordinated interest rate cuts from global central banks, including the Fed, failed to put an end to the nosedive in stocks. Major stock indices touched five-year lows on Friday before rebounding about an hour before the close as prices of solid companies were ravaged into a zone many investors could not resist. The afternoon test of hard lows set in the morning held in a technical bottoming pattern; only time will tell if Friday's action was a bottom.
It was the worst week on record for the Standard & Poor's 500 Index, which closed on Friday below the 900 level for the first time in more than five years. At Friday's closing bell, both the Dow Jones industrial average and the S&P 500 were down 18.2 percent for the week, while the Nasdaq Composite Index was down 15.3 percent. The volatility index (VIX) recorded an all-time high close on Friday at just under 70.
The U.S. dollar surged to a 15-month high against a basket of other major currencies on Friday as investors scrambled for cash in the world's reserve currency. With a 6.7 percent gain in the last two weeks, the basket, known as the Intercontinental Exchange's U.S. dollar index, is having its best two weeks since September 1992.
The 10-year Treasury closed at its highest yield of the week at 3.86%. Mortgage rates were up for the week. The prime rate dropped to 4.5% this week after the Fed cuts its Fed funds rate to 1.5%.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.25 % $100,000-$432,500
103% 30-Year Fixed
7% (first mortgage w/1% discount) $100,000-$432,500
9% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
7% $100,000-$432,500
30-Year Conventional w/Financed MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"It's a recession when your neighbor loses his job. It's a depression when you lose your own." - Harry S. Truman
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
New 103% Loan Propels Buyers
By Gary Moore
Mortgage Planner
Want to hear some good news against the backdrop of can’t-do and gloom and doom in the real estate and mortgage market? Could you or someone you know become a homeowner if you could obtain a 100% loan? A 103% loan?
We have cultivated an investor who will provide a mortgage up to 103% of the sales price that will help buyers who have acceptable credit and income but no savings for a real estate investment.
The structure of the loan is a first mortgage of 95-97% of the price and a second mortgage for the balance of the downpayment—or for the downpayment plus 3%. The additional money can be used to pay closing costs, although the seller is allowed to pay up to 3% toward buyer’s closing costs.
The second mortgage is fixed for 15 or 20 years at a rate two percent higher than the first mortgage. So, if the first mortgage rate is 6.75%, the second mortgage rate would be 8.75%.
If you are negotiating for a seller to pay 3% toward closing, you may still want to borrow 103% in order to get extras or upgrades from a builder or to buy down the rate from any seller.
Call me so that I can qualify you for this program. I will work the angles to your--or your friend's--best advantage en route to turning you or them into homeowners.
To get to 100% with a single mortgage, VA and Rural Housing are the options, although only a veteran can get a VA loan and Rural Housing is open to everyone but for homes in certain locations. In Williamson County, for example, parts of Nolensville, College Grove, Thompson’s Station and Fairview are eligible for Rural Housing. All of Dickson County is included, for example.
FHA remains another great option for a buyer with a low initial investment—the requirement is 3% invested, which can come from a gift from a family member.
Weekend Market Update
Oct. 4-5, 2008
Wall Street ended its worst week in seven years with another tumble on Friday on fears that the $700 billion financial rescue package may not unblock credit markets and stave off a U.S. recession. The monthly jobs report earlier in the day suggested the economy may be in a recession. U.S. employers cut 159,000 jobs in September, the ninth straight monthly reduction and the steepest decline in five and a half years.
Interest rates remain favorable and steady, held down by the weak economy. The 10-year Treasury closed at a yield of 3.64%, although the LIBOR, which provides the index for many loans, crossed above 4%. Some observers believe there is no way interest rates can remain low as the U.S. Treasury has to offer a competitive rate to bring in buyers of U.S. debt, which has passed $11 trillion during the Bush administration.
30-Year Conventional Fixed
5.875% $200,000-$432,500
FHA-VA
6 % $100,000-$432,500
103% 30-Year Fixed
6.75% (first mortgage w/1% discount) $100,000-$432,500
8.75% fixed 20-year second mortgage
100% Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/Financed MI
6.25% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Trade what you observe, not what you believe." - David Nassar
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Foreclosure Cats:
Weekend Market Update
Sept. 27-28, 2008
U.S. markets were steady in Friday trading as members of Congress publicly stated they expected a bailout plan would be announced on Sunday. In the largest bank failure in U.S. history, the FDIC seized assets of Washington Mutual on Thursday and then quickly sold most of WaMu's assets and liabilities to J.P. Morgan. In a classic "run on the bank," WaMu customers withdrew $16.7 billion in a 10-day period following the bankruptcy of Lehman Brothers, leaving WaMu with "insufficient liquidity to meet its obligations," regulators determined. WaMu shares vaporized, and shares of other large regional banks withered in the wake of the WaMu failure.
WaMu, along with Countrywide, was a leader in offering so-called "option ARM" mortgage products, wherein customers were allowed to pay less interest than was accruing on the loans, meaning that principal balances were increasing--negatively amortizing--while home values in much of the country were decreasing. The FDIC insures deposits up to $100,000. Washington Mutual paid former CEO Kerry Killinger $14.4 million in 2007 and over $54 million from 2002-07, according to Forbes.
Mortgage rates remained favorable and steady for the week, and many excellent mortgage products are available, despite the gloom and doom that dominates headlines. With plentiful inventory priced well, now remains a good time to go against the crowd and invest in real estate.
30-Year Conventional Fixed
5.875% $200,000-$432,500
FHA-VA
6 % $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/Financed MI
6.25% $100,000-$432,500
30-Year Conventional Interest Only
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"No matter what the models say, traders are not machines guided by silicon chips; they are impressionable and imitative; they run in flocks and retreat in hordes."
- Roger Lowenstein
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Sept. 20-21, 2008
Mortgage rates held steady during a tumultuous week in the markets when stocks sold off hard, then bounced, as a government-proposed bailout of troubled financial institutions was aired. A government-mandated halt to short selling of stocks fed the rally as holders of short positions had to buy shares to cover. Look for stocks with a large short interest, including many of the embattled financial institutions, to experience a short-term price increase until the excessive short positions are unwound.
A reiteration that the government intends to support the buying of mortgages gives underpinning to the housing market. Mortgage rates dipped earlier in the week in conjunction with hard selling of stocks, as often happens, and leveled off late in the week as stocks sprang back. The 10-year Treasury fell to below 3.5% in yield earlier in the week, but closed the week up at 3.77% in an unusual disconnect with the pricing of mortgage-backed securities. Mortgage rate pricing actually improved in early afternoon while Treasuries fell in price and rose in percent yield as money flowed into stocks.
The fundamentals for home buyers and real estate investors remains as it has for many months--inventory is plentiful and attractively priced, and mortgage rates are low.
30-Year Conventional Fixed
5.75% $200,000-$432,500
FHA-VA
5.75 % $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.5% $100,000-$432,500
30-Year Conventional w/Financed MI
6.125% $100,000-$432,500
30-Year Conventional Interest Only
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"A bank is a place where they lend you an umbrella in fair weather and ask for it back when it begins to rain." - Robert Frost
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Sept. 13-14, 2008
Markets began the week reacting to the Treasury's takeover of Fannie Mae and Freddie Mac and ended the week fretting about Hurricane Ike and which major financial institutions might be the next to fall with a thud. Fed officials indicated there would be no bailout of struggling investment bank Lehman Brothers. Refineries in the path of the hurricane shut down and sparked long lines and emptying supplies at the gas pumps. Mortgage rates benefited as a relief reflex over government backing lenders' ability to sell mortgages in the secondary market.
30-Year Conventional Fixed
5.75% $200,000-$432,500
FHA-VA
5.75 % $100,000-$432,500
100% Guaranteed Rural Housing w/no MI
6.5% $100,000-$432,500
30-Year Conventional w/Financed MI
6.125% $100,000-$432,500
30-Year Conventional Interest Only
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"If you have but one wish, let it be for an idea." - Percy Sutton
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Sept. 6-7, 2008
Mortgage rates dropped back to the 6% or under range for the first time in months as a short-term rate decline played out on Friday before reversing itself after trading hours, signaling a possible end to this recent drop. Government reports indicating a weak economy made investors favor bonds and mortgage-backed securities over stocks early in the day as August unemployment hit 6.1%, the greatest amount in five years. More than 84,000 Americans lost their jobs in August, which was higher than analysts had projected. The 10-year Treasury closed at a yield of 3.66%, its lowest point since April. Prime rate is 5%.
Excellent mortgage financing options remain available to owner-occupant buyers and refinancers and to investors, despite what you have seen on TV or read in the papers. Although many programs have been cut or highly modified, there is still "more than one way to skin a cat" with the help of a savvy and conscientious mortgage planner. For example, lender-paid MI (mortgage insurance) enables a borrower to avoid mortgage insurance added to a monthly payment. Interest-only programs help your monthly cash flow, but they can be fixed for 30 years so that your rate will never increase.
With much real estate inventory and favorable rates, now presents an opportune time to invest in real estate.
30-Year Conventional Fixed
5.875% $200,000-$432,500
FHA-VA
6 % $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/no Borrower MI
6.5% $100,000-$432,500
30-Year Conventional Interest Only
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"The oil can is mightier than the sword." - Everett McKinley Dirksen
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Aug. 30-31, 2008
Dell shares plunged 13.8% to 21.73 on Friday, the stock's biggest one-day percentage drop since November 2000. Late Thursday, the No. 2 PC maker posted a disappointing second-quarter profit and said weak tech spending was spreading beyond the U.S.
Other tech bellwethers also fell Friday, a down day overall for Wall Street on rising oil prices and a steep drop in July personal income data.
Dell executives spoke of weakened tech spending in the U.S. spreading to Western Europe and parts of Asia, during conference calls with reporters and analysts. Profits from foreign sales are also being squeezed by currency exchange rates. When the dollar is down, a high percentage of profit from sales by U.S. companies abroad comes from currency translation. With the U.S. dollar recently firming against foreign currencies, some of that profit will vanish.
The 10-year Treasury stayed below 4% yield for the week, and mortgage rates remained in a favorable range for homebuyers and investors to take advantage of bargains in the real estate market.
30-Year Conventional Fixed
6.125% $200,000-$432,500
FHA-VA
6.25% $100,000-$432,500
100% Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Fixed w/Lender-Paid MI
6.375% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"If at first you don't succeed, you're running about average." - M. H. Alderson
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Aug. 9-10, 2008
Several national lenders announced on Friday further tightening of home mortgage criteria as the effects of record foreclosures and legislation continue to impact the markets.
No longer available, after the housing legislation passed on July 30, are the seller-funded "downpayment assistance" programs which enabled buyers to get around FHA's requirement of a 3% investment in a home purchase. A shell game, which FHA approved for years, had sellers pay a "non-profit" organization a donation which would then be funded back to the buyer, in order to skirt the 3% requirement.
Lenders are also rejecting the use of non-traditional credit to approve an FHA loan and are requiring that borrowers have a credit score from at least two of the three major credit reporting companies. Non-traditional credit has been used when borrowers do not have the kind of credit which shows up on credit reports, such as credit cards and car payments to institutional lenders, but when they can document a good payment history to utility companies and landlords.
Stocks were up sharply on Friday after oil prices fell and Fed Chairman Ben Bernanke said inflation pressures are likely to moderate. Mortgage rates eased on the week.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.25% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Interest-Only Fixed
6.875% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"We can chart our future clearly and wisely only when we know the path which has led to the present." - Adlai E. Stevenson
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Aug. 16-17, 2008
Oil fell on a growing sense that economies around the world are joining the U.S. in a slowdown. The rising dollar, which is gaining strength on economic concerns, contributed to the sell-off in crude and other commodities. Crude is down more than $35 from its July 11 record of $147.27; meanwhile, gold prices that swept past $1,000 an ounce earlier this year are now below $800.
While the decline in oil was placating investors this week, it still did not offset their anxiety over the slumping housing and credit markets. Concerns about more write-downs at investment banks continued, causing major market indexes to fluctuate over the course of the week; the Dow Jones industrials continued a volatile streak, dropping more than 100 points two days in a row amid intensifying fears about the health of the financial sector.
Mortgage rates were flat to lower on the week, and the 10-year Treasury closed at a yield of 3.84%. Under the hood of the mortgage business, lenders continue to pull back on program offerings.
30-Year Conventional Fixed
6.375% $200,000-$432,500
FHA-VA
6.5 % $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/no Borrower MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Oil prices have fallen lately. We include this news for the benefit of gas stations, which otherwise wouldn't learn of it for six months." - William D. Tammeus
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
Aug. 9-10, 2008
The dollar raced to five-month highs against a broad range of currencies on Friday, benefiting from fears economic weakness was spreading to other countries, while oil slumped to $115 a barrel as supply concerns waned.
Stock markets were transfixed by falling oil, and the Dow Jones industrial average closed up 302 points. Wall Street largely shrugged off news that Fannie Mae, the largest U.S. home funding source, posted a fourth straight quarterly loss as home loan defaults increased.
The rebound in risk appetite hurt safe-haven assets such as government bonds, as is normally the case. This sent prices lower on U.S. Treasuries and weighed on euro zone government paper, making yields, which move inversely to prices, rise.
The Federal Open Market Committee met this week and left its short-term interest rate unchanged. The Fed is tugged in opposite directions by data underscoring a weak economy-such as a Labor Department report that last week's jobless claims totaled 445,000, a six-year high-and high inflation, which is obvious to consumers. The Fed funds rate is 2% and the prime rate is 5%.
30-Year Conventional Fixed
6.5% $200,000-$432,500
FHA-VA
6.5% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Interest-Only Fixed
6.875% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"I don't set trends. I just find out what they are and exploit them." - Dick Clark
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
July 26-27, 2008
The trend remains up for interest rates, which are moving persistently but incrementally higher as forecast in our June 10 "Red Alert on Rates." The 10-year Treasury rose to a 4.11% yield in another volatile week of trading in the stock and bond markets. The good news is that rates are still in the historically low range that we have enjoyed since 2002, and the real estate market is ripe for opportunistic buyers.
30-Year Conventional Fixed
6.5% $200,000-$432,500
FHA-VA
6.5% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Interest-Only Fixed
6.875% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"A single idea, if it is right, saves us the labor of an infinity of experiences."
- Jacques Maritain
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower)
Weekend Market Update
July 12-13, 2008
Markets ended a rocky week on Friday as stocks sold off and Treasuries fell on concerns that Freddie Mac and Fannie Mae could fail amid the foreclosure crisis. The Dow average dipped below 11,000 intra-day, the first move below 11,000 in almost two years. Friday's drop meant Wall Street moved squarely into a bear market, which is defined as a 20% drop from a recent peak. The Dow is down 21.6% from the record closing high of 14,164 it reached in October. The S&P 500 is down 20.8%, and the Nasdaq is off 21.7%.
Treasuries, which are often a safe-haven play when money is moving out of stocks, had more sellers than buyers, also, with the yield on the 10-year rising to 3.94%. Mortgage rates were under upward pressure as well. Oil crossed another all-time high, rising above $147 a barrel at one point.
Sen. Christopher Dodd, D-Conn., the Senate Banking Committee chairman, raised the prospect that Fannie Mae and Freddie Mac, who provide the country’s major source of mortgage funding, could be given access to emergency Federal Reserve lending. Dodd, who spoke Friday to Fed Chairman Ben Bernanke and Treasury Secretary Henry Paulson, said the two are "looking at various options" for propping up the firms if they ultimately need help. Those include giving them access to the Fed's emergency lending "discount window," Dodd said.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.375% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Interest-Only Fixed
6.875% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"The meek shall inherit the Earth, but not its mineral rights." - John Paul Getty
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
July 5-6, 2008
U.S. employers cut workers for a sixth straight month in June for the longest such streak since 2002, and the country's vast service sector unexpectedly contracted, underscoring the economy's frailty. The Labor Department said on Thursday that 62,000 nonfarm jobs were shed last month, bringing the number of jobs lost this year to 438,000 as the national housing market slump chilled growth. The unemployment rate, which shot up sharply in May, held steady at 5.5 percent.
A separate report showed new applications for jobless benefits rising to 404,000 last week, a level associated with past recessions.
Stocks were up on Thursday, ahead of the Fourth of July holiday, when markets were closed, but were down for the week in a continuing gloomy mix of high commodity prices and a weak economy. Stocks are down about 20% from their October 2007 highs.
The 10-year Treasury closed the week at a yield of 3.97%, and mortgage rates were up on Thursday, with Treasuries moving opposite of stocks. Money moving out of stocks and into bonds and mortgage-backed securities have held mortgage rates down recently, although rates are clearly trending higher in the short term.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.375% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Fixed w/Lender-Paid MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"We are not retreating - we are advancing in another direction."
- General Douglas MacArthur
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 28-29, 2008
Worries about high commodity prices and continued write-downs among financial institutions slammed stocks this week, with the Dow average down 4.2% for the week and almost 20% below its all-time high set last October. Oil hit another in a string of record highs, stopping just shy of $143 a barrel. The Fed met this week and left its short-term rate unchanged as it weighs inflation forces against the need to support a weak economy. Money moving from stocks and into safer plays was good for Treasuries and mortgage rates. The 10-year Treasury dipped below 4% yield.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.375% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Fixed w/Lender-Paid MI
6.5% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
“Life is like playing a violin in public and learning the instrument as one goes on.” --Samuel Butler
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 21-22, 2008
Stocks ended a rocky week at their lowest level since March 17, the day Bear Stearns collapsed. The Dow average dipped below 12,000 and was down 222 points on the day, while money moved from stocks to Treasuries. Mortgage rates eased down for the week after creeping upward for most of June. A Merrill Lynch downgrade of regional banks piled on other bad financial sector news during the week: Washington Mutual announced it was cutting 1,200 jobs, Citigroup warned of significant debt markdowns, Fifth Third said it needed to raise $2 billion and two former Bear Stearns hedge fund managers were arrested in front of TV cameras and charged with lying to investors. The 10-year Treasury closed at 4.137% yield.
30-Year Conventional Fixed
6.25% $200,000-$432,500
FHA-VA
6.5% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Fixed w/Lender-Paid MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Tact is the ability to describe others as they see themselves." --Abraham Lincoln
Visit my website: http://BrentwoodHomeLoan.com
Weekend Market Update
June 14-15, 2008
Stocks ended a turbulent week with a sharp gain on Friday after government readings on inflation eased worries about the effect of rising prices on consumers, and Treasuries regained some footing after a week-long run-up in interest rates. The Labor Department said the Consumer Price Index rose a sharp 0.6% in May, but the so-called core prices, which exclude food and energy, edged up a more modest 0.2%.
The markets chose to view the glass as half full, and seized on the relative stability in core prices to boost stocks and make a case for the Fed not raising short-term rates any time soon. Fed officials sparked selling earlier in the week by worrying publicly about inflation and reminding all that their job was to raise rates to stifle inflation. The Dow index gained 165 points.
Treasuries had been pounded this week, with the 10-year hitting its high in yield for the year at 4.26%. I had signaled on Tuesday in my "Red Alert on Rates" that bond yields and mortgage rates were galloping upward. Friday's action tempered those rate increases, although mortgage rates increased by about .375% for the week.
U.S. home foreclosure filings in May increased from April and were a whopping 48% higher than a year earlier, real estate data firm RealTrac said on Friday.
30-Year Conventional Fixed
6.375% $200,000-$432,500
FHA-VA
6.5 % $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.75% $100,000-$432,500
30-Year Conventional w/no Borrower MI
6.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"It's never too late." -Anonymous
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
June 7-8, 2008
Stocks were ripped in Friday's trading after crude oil jumped $11--it's biggest-ever one-day spike--to a fresh record high above $138 a barrel and after the May unemployment rate jumped the most in 22 years. Inflation operating within a weak economy--"stagflation" as it was called in the 1970s--appears to be the theme of the markets.
The Labor Department's report showed the unemployment rate rose in May to 5.5%--its highest level since October 2004--from April's jobless rate of 5%. The report showed the economy lost jobs for a filth straight month. The Dow average of stocks dropped about 397 points. Treasuries benefited as money moved from stocks to safer instruments, and the 10-year closed at a yield of 3.94%.
Mortgage rates, which had been in a short-term rising trend, softened on Friday but will likely be priced better on Monday morning due to Friday's afternoon action. The Federal Reserve has said it will quit lowering its short-term rate, which has left prime at 5%.
30-Year Conventional Fixed
6% $200,000-$432,500
FHA-VA
6.25% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.5% $100,000-$432,500
30-Year Conventional w/no Borrower MI
6.5% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"At times it is folly to hasten; at other times, to delay.
The wise do everything in its proper time." - Ovid
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
‘Highlights’ and ‘Lowlights’
from Changing Mortgage World
By Gary Moore
Mortgage Planner
You have heard of XP going to Vista and version changes happening all the time in the world of software programs. You may or may not have heard that Fannie Mae is shifting from Desktop Underwriter version 5.7 to version 7.0 effective on Sunday, June 1.
If you are worried that you or one of your buyers won’t qualify under the new guidelines, then call me on Saturday, May 31, and I will run your loan through Desktop Underwriter, which will honor its criteria until you have time to close your loan, even if it is after June 1.
I am halfway joking about the need for borrowers to scramble to get in under the wire of the program changes to Fannie Mae’s widely used, automated system which evaluates and approves or declines—or “refers”—a borrower for a loan.
While the so-called credit crisis has been playing out over the past year, what I often call the “gremlins” inside the artificial intelligence of the underwriting “machine” are constantly at work, changing or tweaking the system and the criteria for evaluating a loan. I have been feeling the changes for months as loans that would have been formerly approved are now being declined with the current software system. So the differences between 5.7 and 7.0 will not be so sweeping as the overhaul suggests, and in some ways, 7.0 may be more favorable and may allow more borrowers of a certain type to succeed.
For example, the DU 7.0 release notes make it plain that the underwriting system will no longer penalize self-employed borrowers. Formerly, if the borrower was self-employed, he or she was viewed as a greater risk and could get a downgraded loan finding as opposed to a salaried borrower. DU has stated that research shows self-employed borrowers have a higher default rate. For some reason, the “gremlins” inside the machine have changed their opinion about self-employeds or have come to the conclusion that salaried borrowers can have an equivalent risk.
I have always believed that a self-employed borrower, if anything, should be viewed as a lesser risk. Any salaried borrower is subject to losing his or her job at any point, just as a small business can fail. However, someone who is self-reliant and is accustomed to having to make his or her own way is more likely to survive than someone who has always been an employee, dependent on someone else to plug him or her into an existing organization. That’s what I think, anyway.
Credit standards will not be changed. Credit and payment history is important, and that is a whole other subject.
Interestingly, “authorized user” accounts will no longer help a borrower. An authorized user is someone who may use the credit card of another but who did not apply for the credit initially and who is not responsible for payment. This could be a spouse, a child, or anyone. I used to advise college students and parents to put a child on a parent’s account as an authorized user—and just don’t tell the kid!—which would give him a credit reference and help him obtain a credit card of his own or other credit on the strength of the primary user’s credit history. So, that “freebie” is over for mortgage qualifying.
Some people that I have written about before have offered to sell for hundreds or thousands of dollars a good credit account to be used by a weak credit individual as an authorized user. The weak person would not actually get to use the card, but he or she could benefit from having the anonymous person’s good credit history suddenly appear on his credit report. (The authorized user tactic may still help in getting a credit card, if no longer a mortgage, although credit cards seem so highly pushed upon college students that no credit history is not a barrier.)
Once I got a loan approval for a non-U.S citizen, a physician from South America, largely because a friend and colleague had put her on his credit card as an authorized user. It gave her a credit score to have a 10-year good payment history on his Visa card, although she had only been in the U.S. for six months.
Other, more significant changes have already taken place through changes in Fannie Mae guidelines and lenders overlaying their own guidelines. Generally, downpayments must be larger, credit must be better, and debt ratios must be lower than a year ago. That is already in place. The 100% conventional loans have been pulled; the only 100% loans left are VA and Rural Housing.
I can no longer say that credit scores do not matter with an FHA loan, as if your score is below 580, you will not qualify.
Scoring is tiered more than before, and higher scores are advantages with better rates and less points, and the reverse is true. For a conventional loan, a score of 720 or above gets you the best rate and pricing, but even from 700-719, which is an excellent score, you start taking “hits” to pricing for a lower credit score. The lower the score, the more the loan will cost.
That brings up another pet peeve of mine. The subprime loans which are largely blamed for the record number of foreclosures and defaults have always mystified me. They are made to borrowers who have certain weaknesses or who cannot document their income or assets in a way the “good” loans require. So, for having some sort of weakness or deficiency, the interest rates are higher and there are prepayment penalties which preclude borrowers from refinancing for two to three years. After the prepayment penalty phase is over, the rates typically increase, say from 8% to 11%.
I have always wondered, if a borrower is weak to start with, what does it serve to saddle him or her with a worse loan that will be more difficult to pay? I think if a borrower is that bad, he should not get the loan and thus not be put in a hole to start with.
If you are still scared that the mortgage world will change tomorrow, please call me today, and we will get your loan in under the wire of 5.7!
Gary Moore is a senior mortgage planner with United Funding Group, Brentwood, Tn., and may be reached at 615-579-8658.
Weekend Market Update
May 31-June 1, 2008
Consumer confidence fell to its lowest level in 28 years, with the University of Michigan’s sentiment index dropping to 59.8, while tech stocks rose after Dell reported a positive earnings surprise. While U.S. buying may be stagnant, the strength in semiconductor and other tech stocks is being supported by global demand. Interest rates turned up for the week, although mortgage rates improved on Friday, and the 10-year Treasury crossed above 4% yield for the first time since early January. Some mortgage rate watchers believe the trend in rates is now up.
30-Year Conventional Fixed
6% $200,000-$432,500
FHA-VA
6.25% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.5% $100,000-$432,500
7/1 ARM Interest-Only
5.75% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"In the absence of the gold standard, there is no way to protect savings from confiscation through inflation. There is no safe store of value." - Alan Greenspan
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
May 24-25, 2008
Stocks suffered their worst week of declines since February as traders feared rising oil prices would sap consumers’ buying power and hurt the economy. Oil maintained its strong spike upward, crossing $135 a barrel on Thursday and continuing an uptrend that began when $50 was broken in early 2007. Money moved into Treasuries, which supported mortgage-backed securities and thus kept mortgage rates low. April existing home sales nationwide were down when compared to last year but not so much as analysts had expected. Now is a great time to buy a house, when the “crowd” is cowering on the sidelines.
30-Year Conventional Fixed
5.75% $200,000-$432,500
FHA-VA
6% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.25% $100,000-$432,500
7/1 ARM Interest-Only
5.5% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"The Stone Age didn't end because they ran out of stones; the Oil Age won't end
because we run out of oil." - Don Huberts
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower)
Weekend Market Update
May 17-18, 2008
Oil prices hit another record, crossing $126 a barrel as traders expected the earthquake in China will increase demand for diesel. May's preliminary University of Michigan Index of Consumer Sentiment showed a reading of 59.5, which was the lowest in 28 years and which was less than forecast, meaning that consumers were less optimistic about their own financial situations than many had thought. Waning confidence usually means consumers are less apt to make large purchases in the near future, and a continuing weak economy scenario can be expected to keep mortgage rates low.
30-Year Conventional Fixed
5.75% $200,000-$432,500
FHA-VA
6% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.25% $100,000-$432,500
7/1 ARM Interest-Only
5.5% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"Years of practice enable the trader to act on the instant when the unexpected happens as well as when the expected comes to pass." - Jesse Livermore
Visit my website: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower.)
Weekend Market Update
May 10-11, 2008
Wall Street ended the week with a big decline as investors grappled with two of the biggest threats to the economy: fallout from turmoil in the credit market and surging energy prices. All three major indexes suffered losses for the week.
Insurer American International Group Inc. helped send the Dow Jones industrial average down about 120 points after posting a wider-than-expected first-quarter loss that rekindled anxiety about the strained state of the global financial system.
AIG reported it lost $7.81 billion -- its second straight quarterly loss -- and revealed plans to raise $12.5 billion in the coming months. The world's largest insurer, like many of its peers in the financial services sector, has seen its investments in the credit markets plunge in value.
Meanwhile, rising crude oil prices remained a source of worry for investors, as they had much of the week and in recent months. Oil futures rose above $126 a barrel for the first time, further stoking Wall Street's concerns about inflation that could curtail consumer spending. Light, sweet crude rose as high as $126.20 on the New York Mercantile Exchange before settling at a record $125.96. For the week, oil jumped nearly $10.
The economic figures arriving Friday underscored the slowdown in the U.S. economy. The Commerce Department said the U.S. trade deficit narrowed in March as demand for imports registered the biggest decline since the last recession was ending. The deficit stood at $58.2 billion, a decrease of 5.6 percent from February. The 2.9 percent drop in demand for imports was the steepest monthly decline since December 2001 -- a month after the last recession ended.
Mortgage rates remained low for the week, and the 10-year Treasury declined slightly in yield to 3.78% by Friday’s close. The analyst who provides my “Daily Rate Lock” subscription service looks for money to move from stocks to bonds in the near term, which would keep mortgage rates down.
Check out as an alternative for buyers the conforming adjustable rate, interest-only product quoted below. While the Fed has cut short-term rates, and while this has not affected 30-year fixed rates, it does affect shorter-term instruments, such as 1-year, 3-year, 5-year, and 7-year adjustables. The lower rate combined with the interest-only feature can make for a lowered monthly payment and improved cash flow.
30-Year Conventional Fixed
5.875% $200,000-$432,500
FHA-VA
6% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.25% $100,000-$432,500
7/1 ARM Interest-Only
5.5% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"I can't change the direction of the wind, but I can adjust my sails to always reach my destination."- Jimmy Dean
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower. Reply to discontinue Update.)
Weekend Market Update
May 3-4, 2008
The Labor Department brought bad news for bonds with Friday’s April employment report, which stated the unemployment rate fell to 5.0% when it was expected to rise to 5.2%. The payrolls number also hit Treasuries with a 20,000-job decline compared to the forecasted 75,000 drop. Those readings indicate that the employment sector may not be as bad as many had thought. Bond yields rose and mortgage rates were pressured in Friday’s trading. The 10-year Treasury closed at a yield of 3.85%. Earlier in the week the Federal Open Market Committee dropped its short-term Fed funds rate by .25%, which puts the prime rate charged by most banks at 5%. The prime rate one year ago was 8.25%.
30-Year Conventional Fixed
6% $200,000-$432,500
FHA-VA
6% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.25% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
Cell: 615-579-8658 Toll-free fax: Toll-free: 1-866-321-6513
"To keep a lamp burning we have to keep putting oil in it."
- Mother Teresa
Visit my mortgage web site: http://BrentwoodHomeLoan.com
(0% points, 1% origination, 30-day lock. Market Update informs on market trends and is not a quote for a unique borrower. Reply to discontinue Update.)
Weekend Market Update
April 26-27, 2008
Weak sentiment news did not help Treasuries or mortgage rates as Treasury prices sagged and rates moved up modestly. The University of Michigan’s update to their Index of Consumer Sentient for April showed a reading of 62.6, which was lower than forecast and its lowest in 25 years. Bonds were also down on Thursday despite the March Durable Goods Orders report showing a 0.3% decline, while analysts were expecting a small increase in new orders, meaning the manufacturing sector was not as strong as thought. This was the third consecutive monthly decline in orders. Bad economic news is typically good for Treasuries as it indicates less spending and low inflation ahead. When markets “misbehave” and go against the news, it is often a strong signal, in this case signaling that the direction of rates is up. Consumers also know that inflation is going strong despite indicators that say the economy is slow.
30-Year Conventional Fixed
6% $200,000-$432,500
FHA-VA
6% $100,000-$432,500
Guaranteed Rural Housing w/no MI
6.25% $100,000-$432,500
Call for free pre-approval and to discover
the best financing for you!
...by Gary Moore
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