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Looking Back And Looking Ahead : November 10, 2008

November 10, 2008

Mortgage rates fell last week, marking just the second time since September that rates improved on a weekly basis. The biggest news of the week was the U.S. Presidential Election. Markets appeared to cheer the Republican-to-Democrat transfer of power, posting large gains Tuesday, Wednesday and Thursday. This in spite of a spate of negative economic […]

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How The Presidential Election May Impact Mortgage Rates

November 2, 2008

More than a handful would-be home buyers stayed on the sidelines this year, waiting for Election Day to pass. The prevailing thought was that once the new President-Elect was identified, credit markets will systemically unfreeze and housing markets will return to normal. If history is a guide, this is an unlikely scenario. Election Day doesn’t […]

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Looking Back And Looking Ahead : October 27, 2008

October 27, 2008

Mortgage markets followed the recurring trading pattern of 2008 last week — volatility, volatility, and more volatility. After opening with a strong performance that drove rates down, late-week fears of a global recession reversed that path.  Mortgage rates ended the week unchanged. This was an unexpected outcome for the week considering that: The dollar gained […]

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Looking Back And Looking Ahead : October 27, 2008

October 27, 2008

Mortgage markets followed the recurring trading pattern of 2008 last week — volatility, volatility, and more volatility. After opening with a strong performance that drove rates down, late-week fears of a global recession reversed that path. Mortgage rates ended the week unchanged. This was an unexpected outcome for the week considering that: The dollar gained […]

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Home Sales Are Up, Home Supply Is Down — This Is What A Recovering Market Looks Like

October 27, 2008

Statistics are what you make of them, but sometimes, they can provide good perspective. For example, from its peak in 2005 to its trough in late-2007, the number of “used” homes sold nationwide plunged. In 2005: Roughly 7 million homes sold annually In 2007: Roughly 5 million homes sold annually Through all of 2008, though, […]

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Home Sales Are Up, Home Supply Is Down — This Is What A Recovering Market Looks Like

October 24, 2008

Statistics are what you make of them, but sometimes, they can provide good perspective. For example, from its peak in 2005 to its trough in late-2007, the number of “used” homes sold nationwide plunged. In 2005: Roughly 7 million homes sold annually In 2007: Roughly 5 million homes sold annually Through all of 2008, though, […]

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Looking Back And Looking Ahead : October 20, 2008

October 20, 2008

Last week, the Dow Jones Industrial Average recorded both its largest one-day point gain and second-largest one-day point loss in history. Mortgage markets got whipsawed, too. From day to day, huge rate swings made mortgage rate shopping difficult.  It wasn’t uncommon for lenders to change pricing 3 times per day. When the week closed, though, […]

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How Terrible Housing Data Can Actually Help Push Home Values Higher

October 18, 2008

Once again, the headlines may be misleading you.  It’s a good thing that Housing Starts dropped last month — despite what the papers say. A “housing start” is a new residence on which construction has started.  Yesterday, the government released September 2007’s Housing Starts data for the country. There was a 10.2% drop in Housing […]

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The Rising Cost Of A Small Downpayment

October 17, 2008

Private Mortgage Insurance (PMI) is a mortgage lender’s insurance policy against highly-leveraged homeowners.  It’s typically required when homeowner equity is less than 20 percent at the time of closing. With PMI defaults up 40 percent over last year, though, private mortgage insurers are taking big losses. They’re also taking outsized steps to prevent additional claims going forward […]

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The Obvious Truth About Mortgage Rate Predictions

October 16, 2008

As the stock market dips then jumps then dips again, it’s important to remember that markets are unpredictable and nobody knows what will happen tomorrow. Unfortunately, that doesn’t stop the analysts from trying. An obvious example comes from May of this year.   As the price of oil crossed $120 per barrel on its way to an […]

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Pending Home Sales Shows That More Buyers May Be Shopping For Homes Than You Thought

October 9, 2008

Buyers are returning to the housing market. Each month, The National Association of REALTORS® tracks homes under contract to sell, but whose closing has not yet happened.  It calls them “pending sales” and publishes a monthly report to quantify them. The Pending Home Sales report is important because it’s meant to predict future home sales activity.  […]

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The Impact Of The Federal Reserve’s Emergency Half-Point Rate Cut To 1.500 Percent

October 8, 2008

The Federal Reserve made an “emergency rate cut” this morning, dropping the Fed Funds Rate by one half-percent to 1.500 percent. The move is meant to stimulate the U.S. economy. When the Federal Reserve changes the Fed Funds Rate, it often takes 9 months for the changes to work their way through the economy. On […]

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Looking Back And Looking Ahead : October 6, 2008

October 6, 2008

Congress approved the $700 billion “Bailout Bill” Friday, answering the question that dogged mortgage markets all week long: Will they or won’t they pass it? The uncertainty prior to the vote created huge market swings that ultimately sent the Dow Jones Industrial Average to its worst week since the 2001 terrorist attacks, while causing similar […]

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Fannie Mae Halves One Of Its Mandatory Loan Fees

October 3, 2008

In an effort to provide “the most market support possible”, Fannie Mae is cutting one of its mandatory loan fees by 0.250 percent, effective immediately. Fannie Mae introduced the Adverse Market Delivery Charge in December 2007 to offset foreclosure and delinquency losses.  The initial fee was a quarter-percent of the amount borrowed. Then, as market conditions […]

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How Mortgage Rates Responded To The “No” Vote On The Bailout Bill

September 30, 2008

Monday afternoon, the U.S. House of Representatives defeated the $700 billion “Bailout Bill”, surprising Wall Street and the world. The Dow Jones Industrial Average responded by falling 777.68 points — its largest one-day loss in history and, this morning, every newspaper in America is covering the story as front page news. Lost in the coverage, […]

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Looking Back And Looking Ahead : September 29, 2008

September 29, 2008

Mortgage rates bounced around last week, ending up worse overall.  It was the second straight week in which rates deteriorated.  Sentiment was driven largely by the proposed Emergency Economic Stabilization Act of 2008 — a.k.a. The $700 Billion Bailout. The good news is that Congress drafted its bill Sunday evening and within the 110 pages, […]

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Falling Home Supplies Are Bad News For Home Buyers (But Good News For Home Sellers)

September 25, 2008

The August Existing Home Sales report was released Wednesday, showing a decline in the number of homes sold nationwide, and a reduction in the median sales price. Not surprisingly, the media singled these two statistics out, playing them as a big negative. They’re not. The decline in sales wasn’t good, but it wasn’t terrible, either — sales […]

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What Happens To Mortgage Rates When Crude Oil Adds $25 In One Day

September 23, 2008

Crude oil prices jumped $25 at one point Monday, ending the day up by 16 percent. This is an unwelcome development for home buyers because the same market forces that pushed up oil prices had a similar impact on mortgage rates. It all comes down to the U.S. dollar. Because both crude oil and mortgage-backed […]

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How To Lower Your Mortgage Rate Every Time The Market Dips

September 19, 2008

Getting a great, low mortgage rate is often a combination of luck and preparation. Consider what happened in conforming mortgages this week: Monday, mortgage rates plunged to their lowest levels of the year Tuesday, they bounced back in full Wednesday, they clicked higher by a eighth-percent Thursday, they clicked higher by another eighth-percent And so, […]

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What’s Good For Home Sellers Is Bad For Home Buyers : Builders Are Dialing It Back

September 18, 2008

In August, home builders broke ground on the fewest number of homes since January 1991. It was the 16th straight month in which Housing Starts declined. But, although the press labels these statistics indicative of a recession, home sellers nationwide quietly applaud them. With fewer new homes coming on the market, home sellers are finding that there’s […]

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