News

Which Leads Which Lower: Mortgage Rates Or The Fed Funds Rate?

January 16, 2008

It’s a point that’s always worth repeating: Ben Bernanke and the Federal Reserve do not control mortgage rates This is particularly relevant today as newspapers, television programs, and market pundits posit that the U.S. is in the midst of a recession. The latest evidence supporting that assertion is that Retail Sales grew at its slowest […]

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What The Bank of America-Countrywide Merger DOESN’T Mean For Homeowners

January 15, 2008

For all that’s been said about the proposed Bank of America-Countrywide merger, what’s not getting talked about is how the merger will impact existing Countrywide customers. The short answer is that it won’t. A mortgage (and its corresponding note) is a legal contract between the lender and the lendee, signed on the date of closing. […]

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The Week In Review (January 14, 2008) : What To Watch For

January 14, 2008

Markets are welcoming the return of cold, hard data this week. Most of last week was spent making sense of Fed speakers, recessionary fears, and a takeover of the nation’s largest lender. This week, we’ll find out if the recent fears of recession are on target, or overblown. The data deluge starts Tuesday with the […]

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Why Making A Less-Than-20-Percent Downpayment Is Getting More Costly

January 10, 2008

Private Mortgage Insurance (PMI) is an insurance policy paid to a lender in the event that a homeowner defaults on his home loan. These defaults are up 35 percent over last year, according to an industry group — bad news for all homeowners requiring PMI with their mortgage. Much like home insurers adjust premiums after a […]

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Why It’s Not So Bad That Unemployment Reached Its Highest Rate Since November 2005

January 4, 2008

On the first Friday of each month, the Bureau of Labor Statistics releases key data about the American workforce. The report is officially called “Non-Farm Payrolls” but most people refer to it as the “jobs report”. The jobs report’s influence on markets is palpable for two major reasons: Consumer spending makes up two-thirds of the […]

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The Week In Review (January 2, 2008) : What To Watch For

January 2, 2008

It’s a short, but heavy, week for mortgage markets.  Investors are returning to the fray after a few lighter-than-normal weeks and their return should bring some stability to mortgage rates. Last week, mortgage bond prices rose which, in turn, moved mortgage rates down. The main reason for last week’s rate improvement was the assassination of […]

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The Week In Review (January 2, 2008) : What To Watch For

January 2, 2008

It’s a short, but heavy, week for mortgage markets.  Investors are returning to the fray after a few lighter-than-normal weeks and their return should bring some stability to mortgage rates. Last week, mortgage bond prices rose which, in turn, moved mortgage rates down. The main reason for last week’s rate improvement was the assassination of […]

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Holiday Spending APPEARS To Be Lower, But It Isn’t Really Lower

December 26, 2007

During the Holiday Season, economists watch consumer spending intently because it makes up two-thirds of the U.S. economy. When spending is stronger-than-expected, it can lead to inflation which pushes mortgage rates higher. So far this season, mortgage shoppers should be in good spirits.  Sales have fallen four weeks in a row and the outlook for a late-December rally […]

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For Some Homeowners, PMI Is Tax-Deductible Through 2010

December 20, 2007

The resurgence of private mortgage insurance continues — if only because it’s aided by Congress. For eligible homeowners, lawmakers voted to extend the tax-deductibility of PMI through 2010.  The law was previously scheduled to expire at the end of 2007. For all loans originated prior to December 31, 2010, and within those years, private mortgage […]

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Why Recession Is Not A Guarantee In 2008

December 14, 2007

In its biggest month-over-month jump since 1973, the Producer Price Index rose 3.2 percent in November. PPI is like a “cost of living” measurement for consumer, except that it applies to business. PPI measures how expensive it is to produce goods on a day-to-day basis. PPI spiking in November is an important development for all […]

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The Week In Review (December 10, 2007) : What To Watch For

December 10, 2007

Among lingering doubts about housing and credit markets, and a general uncertainty about the U.S. economy, the mortgage bond market tanked towards the latter part of last week. As investors moved away from mortgage bonds, mortgage rates forcefully bounced off their two-year lows. A major factor behind last week’s run-up in rates is the market […]

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Mortgage Rate Relief Plan: Who Qualifies For Help?

December 7, 2007

Thursday, the White House revealed its HOPE NOW program, aiming to help sub-prime borrowers freeze their initial “teaser” rates for a period of five years. The program is receiving a lot of ink in the newspaper dailies but sometimes it’s unclear exactly what the program offers, and to whom. Let’s look at the details and […]

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Why You Should Remain In “Ready Position” For Your Mortgage Rate

November 28, 2007

Easy come, easy go. There was a strong rally Monday afternoon in the mortgage bond market.  It was sudden and furious, mostly coming on in the last 60 minutes of trading. When markets closed, mortgage rates for conforming home loans were grazing their lowest levels in nearly two years. It lasted overnight and into the […]

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It’s A Good Time To Buy — But Not For The Reasons You May Think

November 27, 2007

Since November 1, the following banks have written-down at least $1 billion in their respective loan portfolios: Bank of America Barclays Bear Stearns Citigroup HSBC Morgan Stanley Wachovia Wells Fargo This is a big deal to people in the market for a home loan because when banks repeatedly take mortgage-related losses, it can lead to […]

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Black Friday Trivia

November 23, 2007

Today is “Black Friday”, a day that many Americans get started on their Holiday Season shopping. Did you know? The earliest known reference to “Black Friday” is November 29, 1975.  The term was mentioned in two separate articles, both with Philadelphia timelines.  Therefore, the term Black Friday is believed to have originated in Philadelphia. Did […]

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The Week In Review (November 19, 2007) : What To Watch For

November 19, 2007

In a holiday-shortened week with no major economic data releases, expect worries about the credit markets and speculation about holiday shopping to take center stage. Last week was a mixed bag for the economy and mortgage markets responded in kind.  Rates were relatively unchanged. The news started with Wednesday’s Retail Sales report.  In showing a […]

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The Cost Of Living Includes The Cost Of Gas And Food (And May Get More Expensive Through The Winter)

November 16, 2007

October’s Consumer Price Index was released Thursday and showed a 3.5 percent increase in the cost of living since October 2006. The report also showed a core inflation rate of 2.2 percent. The “core CPI” is a smaller part of the overall CPI. The math is the same, but it specifically excludes cost changes in […]

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The Week In Review (November 13, 2007) : What To Watch For

November 13, 2007

The Dow Jones Industrial Average and NASDAQ shed 4.1% and 6.5%, respectively, last week. Normally, this would be good news for mortgage rates because investors tend to look for “safe havens” in bond issues, but instead, just treasuries benefited last week.  Mortgage bonds were left in the dust. Mortgage rates finished to the upside after […]

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It’s Not Your Imagination : Getting A Home Loan Is More Challenging For Everyone

November 7, 2007

If it feels like mortgage approvals are harder to come by than in years past, that’s because it is. And we’re not just talking about sub-prime mortgages (for which the market has nearly vanished in just 12 months). According to a story on Marketwatch, mortgage guidelines are more challenging for everyone to meet — gold-star […]

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It Ain’t Easy Being Green–or is it??

November 7, 2007

No, I am not talking about the song by Kermit the Frog, I am talking about a recent insert in the Wall St. Journal entitled “Handicapping the Environmental Gold Rush” spoke about the benefits of investing in Green Real Estate. According to McGraw-Hill Constructions “2006 Green Building SmartMarket Report,” Green buildings generate 3.5% higher occupancy rates, […]

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