A Very Blustery Day!

The weather in the valley has shifted gears, and I wonder if mortgage backed securities are taking their cue from the weather as they have blown upwards and are having a great day. We needed this day, but we will need to be careful this week as any news could change the upwind to a down wind very quickly.
The senate is debating the positives and negatives of extending the first time home buyers credit. We will see if they make any decisions tonight. All markets are waiting for this tid-bit of juicy news.
Stay tuned for more information.

Rates: They are a Climbing

We may have seen the best of the best when it comes to mortgage rates. As the fed slowly turns off the life support, and the market starts standing on its own two feet again, it is likely that rates will do what is expected, and that is climb. For every action there is a reaction and the market has been artificially stopped from reacting to the real news and real data.
Banks are limiting the numbers of homes on the market to try and inflate values, the government is slowing then stopping their purchases, inflation is going to hit and when it does, rates have to move up.
I had a client tell me that his first home in the 1980's had a rate of 16%. It makes 6 and 7% seem tame doesn't it?

Earnings Reports

The stock market rallied this week on relatively good news from earnings from many sectors. Then Bank of America had their conference call and report. They lost $1 billion last quarter. The stock market did not like that news. I will take it for right now as that will buoy bonds today. We have seen profit taking the last few days in the bond market and that means higher interest rates for borrowers.
Advise for buyers or potential buyers on the fence, jump off!!! Rates will not stay at the 5-5.25% range forever. We have been here much longer than anticipated. I know getting a contract on a house right now is difficult, but perseverance and patience will ultimately pay off. Don't get out of the market, cast a wider net.

Dow Jones hits 10,000

It was a milestone day, as it has been a year since we saw the 10,000 mark. Better this time as we are on our way up and not on our way to 6500 like last year. It is a momentous occasion. The Mortgage Backed Securities market is trading lower, as the Fed notes did not give any good news and with the stock market up, there is money flowing out of bonds and into stocks. It feels almost like a normal market.
I hope that the Stock Market rally continues as there are so many people who will be relying on those funds for retirement in the near future.

35 Day Escrows~A compromise we can live with

In today's limited inventory housing market, having a close of escrow date in the not so distant future always makes a seller (whether a bank or an owner) feel better. But with the changing mortgage market and the disclosures and waiting periods being put into place by the government, accepting a contract with a 35 day escrow may save everyone multiple headaches. The new HERA/MDIA laws require a 4 day disclosure period before an appraisal can be ordered/paid for. If a buyer's agent writes a contract with a 35 day close of escrow, the first four days of the waiting period are no longer a detriment to closing on time. Agents make sure that you write the time frame to begin upon buyer's lender's receipt of fully executed written contract. Everyone is protected, and the 35 days should be a close date that everyone should be able to meet.

Happy Friday!

Mortgage Bonds had a great week and are now giving back some of the gains. That means that the amazing 5% rates we saw on Wednesday are starting to disappear. Now is a great time to purchase a home if you have been considering it. It is also a great time to refinance a FHA loan before the streamline refinance's rules change on Nov. 18. This is how you can take part in the stimulus package if you don't qualify for the other incentives out there. Lock your loan into a low fixed rate and save money, it is a great time to do it all!

$8000 Tax Credit

As of this very minute, the $8,000 tax credit for first time homebuyers expires Nov. 30, 2009. You have to close escrow and have your deed recorded by the 30th, to qualify for this credit. There is talk about extending it, but as of right now, that is not the case. If you are counting on these funds, make sure you are in contract by 10/25/09.

October Already

Really, where does the time go? I have been trying to stay in touch with my social media, but it is amazing how much there is out there; my blog, twitter, facebook, active rain, etc...I get lost in staying in touch. New month, another new commitment to myself and my business.