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Weekend Market Update

March 6-7, 2010

Mortgage rates continue to cling to a range of lows for 2010, although no one is betting they will remain here long.

Interest-rate sensitive instruments were rocked after the Labor Department reported its February non-farm payrolls number (36,000 jobs lost) as better than expected as were its tally of average hours worked and unemployment rate, which was posted as 9.7%. Lenders scrambled to reprice mortgage rates for the worse and the 10-year Treasury dropped; however, by the market’s close, mortgage-backed securities had regained most of the day’s losses, and some lenders reversed themselves.

For the week, the action in mortgage rate pricing ended about like it started, which was in the range of lows for this year. The bottom was hit on Feb. 5, but we are back in that zip code at this point. All my market resources are screaming that now is the time to lock rates as the balance of the year is expected to see interest rates move higher.

U.S. stocks posted another week of strong gains, led by the NASDAQ index, which settled Friday at its highest close since September 3, 2008.

Although all markets are choppy over most time frames, and movements are more backing and filling instead of straight-line rocket shots (or crashes), it may be safe to say it this way: the line of least resistance for stocks appears to be up; the direction of least resistance for mortgage-backed securities and bonds appears to be down (in price, which means up in rate and yield as these instruments must increase rate and yield to draw buyers).

While the stock market generally liked the unemployment number---but only for not being worse---the true unemployment rate, counting long-term unemployed persons who are off the charts and who are listed as having given up seeking a job---is probably closer to 17%.

Education level correlates to the unemployment rate, as better-educated Americans have lower unemployment than others. The following analysis (and my quote from Einstein below) come from Chart of the Day (http://www.chartoftheday.com/20100305.htm?T):

“Today, the Labor Department reported that the unemployment rate held steady at 9.7% during the month of February. For some perspective on the current state of the labor market, today's chart illustrates the unemployment rate by educational attainment.

“As today's chart illustrates, a higher educational attainment has correlated with a lower unemployment rate. For example, the unemployment rate for those that have not completed high school (red line) has increased from 5.8% to 15.6% over the past 40 months -- nearly a 10 percentage point increase. Compare that to the unemployment rate for those that have obtained a bachelor's degree or greater (blue line).

“The unemployment rate for those with a minimum of a bachelor's degree is currently three percentage points above where it was 40 months ago. In any event, the upward trend in the unemployment rate (for all education levels) has slowed in recent months.”

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

"The value of an education ... is not the learning of many facts but the training of the mind to think something that cannot be learned from textbooks." - Albert Einstein

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

March 20-21, 2010

Mortgage rates retouched lows for the year, giving a shot in the arm to buyers and giving a second chance to homeowners who could benefit from refinancing.

Against a consistent drumbeat of market analysts stating that rates are sure to rise this year, mortgage securities pricing stayed in a trough of historical lows.

Real estate activity seems to be more brisk in our market than what we have seen in a while, fueled in part by the approaching April 30 deadline for the $8,000 first-time homebuyer credit and the $6,500 move-up buyer credit. To participate, the sales contract must be executed by April 30, although the sale does not have to close until June 30.

The Federal Open Market Committee met this week with little fanfare and no news, except there are no changes to the discount rate (which had been rumored, and which affects banks) and no changes to the Fed funds rate, which affects consumers and businesses and is not likely to change until the economy shows marked improvement.

Just as much as we are jumping up and down and urging buyers to take advantage of the current, unprecedented “triple threat,” existing homeowners should call me to analyze at no cost or obligation whether it makes sense to refinance, even to go to a different loan type (such as 15-year from 30) or to get cash out or for any reason unique to your life.

Here is what I am calling the triple threat: 1—Government gift incentive; 2—record low rates; 3—supressed prices with plentiful inventory. In the future, this will be one of those opportunities that we will be happy about if we took advantage of it, or that we lament as one of those “shoulda” moments.

Another deadline: FHA mortgage insurance premium increases April 5. If you have any buyers who are close, and who need a local MORTGAGE BANKER (not a broker) WITH IN-HOUSE UNDERWRITING to get a sale closed smoothly and quickly, call me, and I can get your customer situated and get a pre-approval letter to help you negotiate with a seller. So long as we order the FHA case number by April 4, it’s all good.

Jumbo World: Got a listing in jumbo range? Do not feel left out of the party. We have an investor who has the best jumbo pricing I have seen in years, relative to spread between conforming and jumbo. Call me if you have a prospect who needs to see what his or her possibilities are…..or if you would like to have a Homebuyer Finance Guide to help market your listing.

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

5.75% $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

“A sense of duty is useful in work but offensive in personal relations. People wish to be liked, not to be endured with patient resignation.” --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.)

March 12, 2010 (Franklin, TN) - The Williamson County Association of REALTORS® announces the statistics for home sales in Williamson County, TN for the month of February 2010. There were 162 residential and condominium closings reported during this period according to figures provided by RealTracs Solutions, the multiple listing service used by REALTORS® in the Middle Tennessee region.

Compared to February 2009, the number of single-family residential closings increased by seven percent, while the median sales price experienced a thirteen percent decrease. The median is a typical market price where half of all homes sold for more and half sold for less. The average days on the market (DOM) for residential homes increased by one day compared to the same period last year.

Click on Monthly Sales Report- February 2010 to download the pdf version.

"The local real estate market continues to show signs of steady, incremental improvement. This is the fifth consecutive month to post an increase in the number of transactions over the previous year. Our inventory continues to fall and the current number of pending sales exceeds the total number of closings for March 2009. With interest rates remaining low, we anticipate first quarter sales to position us for better year in 2010" said Karen Baker, 2010 President of the Williamson County Association of REALTORS®.

The Williamson County Association of REALTORS® is the professional trade organization servicing the real estate industry in Williamson County. Established in 1962, the association provides professional development and support services for real estate professionals. The association has over 1,400 members and is headquartered in Franklin, TN.

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.)