News

Guess Which 4 States Accounted For More Than 50 Percent Of May 2008 Foreclosures

June 13, 2008

RealtyTrac released its most recent foreclosure statistics and if you only read the headlines, you think the entire country was on the verge of losing its homes. The underlying data tells a different story, however. More than half of the country’s foreclosure activity in May 2008 was tied to just 4 states in the union: California (28 […]

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Is The Federal Reserve Telegraphing Its Next Rate Hike?

June 11, 2008

The Federal Reserve is stumping hard on inflation this week, creating speculation that Fed Funds Rate hikes may be in store for later this month. This is a counter-intuitive development because increases to the Fed Funds Rate are typically associated with periods of rapid economic expansion. Lately, we’ve seen anything but. Witness: High levels of unemployment […]

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Looking Back And Looking Ahead : June 9, 2008

June 9, 2008

There was no rest for the mortgage-rate weary last week. As mortgage bonds sold off early in the week, sharp rate hikes followed. A steady stream of better-than-expected economic reports had re-ignited inflation fears, drawing money from the bond market. On Friday, however, the money flow reversed on a triple threat to the U.S. economy: The […]

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Why It’s Good News For Home Buyers When Unemployment Rates Surge

June 6, 2008

On the first Friday of every month, the Bureau of Labor Statistics releases its Non-Farm Payrolls report. More commonly called the “jobs report”, today’s 2-page analysis of May 2008 shows that the economy shed jobs and that unemployment surged. This is terrific news for home affordability. That may sound counter-intuitive, so let’s dig deeper into the […]

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What Happens When Bernanke Says “Inflation” 55 Times In 5 Pages Of Text

June 5, 2008

Mortgage rates are a big deal when you’re buying a home. With even the slighest uptick in rates, 30 years of mortgage payments can get substantially more expensive and one of the most substantial threats to mortgage rates is an economic event called inflation. Inflation’s influence on mortgage rates is so large that markets can get jarred […]

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Looking Back And Looking Ahead : June 2, 2008

June 2, 2008

Mortgage rates rocketed higher last week, stunning active home buyers and mortgage rate shoppers. Some conforming mortgage rates rose by as much as three-quarters of a percent before Friday’s closing. Even in a year in which mortgage rates have been extremely volatile, last week’s spike was a large one. The main driver of last week’s […]

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The Impact Of Falling Oil Prices On Mortgage Rates

May 30, 2008

Falling oil prices is one reason why mortgage rates are dropping for the first time in 6 days. Oil is off $9 per barrel from last week, a shift that correlates to $0.23 per gallon of unleaded gas, roughly. This drop is good news for both home buyers and “rate shoppers” — high gas prices […]

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18 of 20 Real Estate Markets Show Signs Of Improvement

May 29, 2008

The monthly Case-Shiller Housing Price Index is a popular and often-quoted measurement of the housing market’s health.  The chart above is sourced from its report published yesterday. In 18 of the 20 largest metropolitan areas, home values declined at a slower pace than in the previously measured month.  The report also showed that national home prices […]

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Looking Back And Looking Ahead : May 27, 2008

May 27, 2008

The market optimism that had pushed mortgage rates lower since late-March reversed last week on ever-rising oil prices and a bleak outlook from the Federal Reserve. When gas prices reached $3.93 Friday, it re-ignited inflation concerns and inflation, you’ll remember, is the enemy of mortgage rates. As expected, mortgage rates spiked into Friday’s market close. […]

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How We Know That Prime Rate Will Likely Rise Before It Falls

May 22, 2008

Three weeks after adjourning, Federal Reserve officials release detailed minutes of their most recent meeting. The April 30, 2008 minutes were released Wednesday and it affirmed traders’ beliefs that the Federal Reserve will not be in a hurry to lower the Fed Funds Rate again. This is bad news for two groups of people whose […]

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Looking Back And Looking Ahead : May 12, 2008

May 12, 2008

With little economic news to influence trading and despite a late-Friday afternoon spike, mortgage rates edged lower last week. Two weeks ago, when it lowered the Fed Funds Rate by a quarter-percent, the Federal Reserve noted two things: The economy was stabilizing High energy costs threatened inflation In the days that followed, though, the U.S. dollar […]

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The Counties In Which Home Prices Are Rising

May 8, 2008

When real estate news is reported on television or in the papers, it’s usually told as a national story.  Unfortunately, stories like these aren’t helpful for everyday Americans because real estate is not a national market. Real estate is local. The graph above was used by Fed Chairman Ben Bernanke in a speech to Columbia […]

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Looking Back And Looking Ahead : May 5, 2008

May 5, 2008

Mortgage rates ended higher last week on stronger-than-expected jobs data, strong consumer spending, and an appetite for riskier investments. But, investors were most excited about the Federal Reserve’s hint that its rate-cutting cycle may be over. The week was quiet until Wednesday when the Federal Reserve voted to lower the Fed Funds Rate by a […]

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Why Mortgage Rates Aren’t Falling Even Though The Economy Is Shedding Jobs

May 2, 2008

According to the Bureau of Labor Statistics, the U.S. economy shed 20,000 jobs in April 2008.  The labor force now counts at 146 million people as employed. Normally, a loss of jobs would foretell economic weakness and would be a good thing for mortgage rate shoppers.  Today, though, traders had been expecting a larger loss of […]

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Looking Back And Looking Ahead : April 28, 2008

April 28, 2008

Mortgage markets lost ground last week on inflation concerns and a general feeling that “the worst may be over” on Wall Street. As investors moved money into the stock market, mortgage rates ticked higher for the second straight week. The biggest story from last week was the rising cost of gasoline. Rising energy costs combined with rising […]

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New Home Sales : How The Newspaper Headlines Mislead You

April 25, 2008

Newspaper headlines rarely tell the full story and today’s papers provide a terrific example. From the Baltimore Sun (and others): New-home sales lowest since 1991 8.5% March decline exceeds forecasts; prices also tumble As always, there’s more to the story than the headline. The Census Bureau reported a 8.5 percent decline in New Home Sales last […]

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How To Determine When You’ll Get Your Tax Rebate

April 24, 2008

More than 130 million Americans will receive tax rebates this year as part of Congress’ $168 billion economic stimulus package. Payments begin in about two weeks and range from $600 for individuals to $1,200 for couples, plus an additional $300 per child. Not everyone is eligible for a full rebate, however. For single filers earning […]

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Are You Financially Smarter Than A 12th Grader?

April 10, 2008

Every two years, the Jump$tart Coalition issues a “personal finance” exam to high school seniors. The test highlights the importance of personal financial literacy among America’s youth and comes at an especially important juncture. Many experts — including Fed Chairman Ben Bernanke — believe that basic financial knowledge is essential for (and lacking in) teenagers.  […]

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A Simple Explanation Of “Credit Crunch”

April 8, 2008

News sources like to use the term “credit crunch” in describing the U.S. economy, but they rarely define what a credit crunch is and what it means for Americans. A credit crunch is when the amount of available loans suddenly decreases over a very short period of time. Usually, it follows a period of lending which, […]

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Looking Back And Looking Ahead : April 7, 2008

April 7, 2008

Mortgage rates edged lower last week, buoyed by a weak employment report for March. After shedding 80,000 jobs last month, the number of working Americans is lower by 232,000 so far this year. Many pundits are claiming these figures are proof of a U.S. economic recession but it’s important to keep the data in perspective. […]

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