News You Can Use from Gary Moore

Weekend Market Update

March 13-14, 2010

Major stock indices rose for the second week in a row, and on Thursday the S&P 500 and the NASDAQ closed at highs for the year. Mortgage rates generally held in the range of historic, multi-year lows, although pressure and direction on rates was up as the Fannie Mae current-coupon 4.5% bond dropped 38 basis points for the week.

The S&P reached a new high for 2010 when it settled at 1150.24 on Thursday for its highest close since Oct. 1, 2008. The NASDAQ Composite also closed at a new high for the year, settling at 2368.46 on Thursday for its highest close since Aug. 28, 2008.

The 10-year Treasury yield closed at 3.71%, while the spread between the 10-year’s yield and mortgage bonds held near lows, although the Fed is about done with buying mortgages. Some investors consider the riskier and more unpredictable mortgage-backed securities more attractive at tighter nominal spreads because it indicates that the market expects interest rates will not be volatile going forward.

This may be viewed as an unusual indicator in light of the fact that the Fed’s unprecedented program of buying mortgages is about to expire. The central bank through March 3 spent about $1.2 of its $1.25 allotment on buying mortgages to prop up the housing market. The program will end about March 31, or when the money runs out.

Speaking of unprecedented, we have about 45 more days of opportunity for first-time home buyers to gain an $8,000 gift from Treasury. When first-timers buy, it ripples through the housing market and the broader economy as those who sell to first-timers have their equity unlocked. For move-up buyers, there is a chance to gain a $6,500 check from Uncle Sam. First-time buyers include anyone who has not owned a home in the last three years, as well as certain categories of veterans and persons in targeted rural counties. Call me with any questions.

We are one of two banks in Tennessee that have been chosen by the Federal Home Loan Bank Board of Cincinnati to offer the Welcome Home program, which provides a grant of $5,000 to homebuyers, both first-timers and current or former homeowners, who are in a certain income range. Call me for details.

Meanwhile, the USDA Rural Development 100% loan program will end April 30 due to lack of funding. Call me if you have any buyers who could take double advantage of a USDA loan and the $8,000 stimulus.

Next week markets will be watching for what happens in Congress with financial reform legislation. The Federal Open Market Committee meets next week to discuss and vote on monetary policy.

30-Year Conventional Fixed

4.75% $100,000-$417,000


FHA-100% VA

5% $100,000-$393,300


100% Guaranteed Rural Housing w/no MI

5.5% $100,000-$417,000

30-Year Jumbo Fixed

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

"Price is what you pay. Value is what you get." - Warren Buffett

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. Reply "remove" with your name and email address to discontinue Update.)