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Monday October 11, 2010 Are you interested in purchasing a home or purchasing a home as an investment property but concerned about your credit score, down payment, mortgage insurance, or appraisal fees? With HomePath Financing available on Fannie Mae homes you may qualify even if your credit score is less than perfect. No appraisal fees or mortgage insurance required and the down payment (at least 3 percent) can be funded by your own savings, a gift, a grant, or a loan from a nonprofit organization, state or local government, or employer. This is a great affordable program for First Time Homebuyers. Now is the time to purchase or refinance. There are many different programs available. To find the right one for you call me today! Tami Styndl, Senior Loan Officer. (507)931-8165 Monday Aug 2, 2010 "USDA Rural Housing Bill Passes", "Can mortgage rates get any lower?", "A bold U.S. Plan to help Struggling home owners" These are a few of the recent headlines youve seen in the news. Its no secret that mortgage rates are more attractive then they have been in years. Many consumers are still missing out on the opportunity to improve their finances by taking advantage of not only the lowest rates but the excellent programs that are available now. People assume they are well off, cannot improve their finances, or have been turned down buy a lender who didn't have access to the right program. Don't be left on the side lines, act now by calling me today for a no cost analysis that takes minutes to see how you can reap the rewards of a market geared for recovery and keep your hard earned money in your pocket. Leon Murray, Loan Officer, 800-701-0444 x228 Tuesday July 13, 2010 Thinking about a reverse mortgage? Want to continue to own and live in your home? Receive payments instead of making them? Take cash out for improvements or to eliminate other debt? No income or employment requirement to qualify! Call us first; we are your reverse mortgage experts! Call or stop in today 800-701-0444 x255 - Brandon Baker, Senior Loan Officer. Wednesday July 7, 2010 NOW is the time to lock in to that low rate on your mortgage! Call me today and I can show you how to save yourself from throwing away all of that money on extra interest. Why not cut your mortgage in half and get it paid off faster? For a FREE quote call me at 800-701-0444 x227. - Tiffany Wieberdink, Senior Loan Officer Friday June 25, 2010 "Interest rates on 30-year fixed-rate mortgages fell this week to their lowest level this year and were just barely above their all-time low Freddie Mac reported Thursday. Today's lowest FHA mortgage rates have recently hit an all-time low as the conventional 30 year fixed mortgage dropped below 4.5%. As I type this you've got home prices that are at an all-time low. You've got interest rates that are at an all-time low and you've got an abundance of homes for sale. So if you are a renter it's a no brainer if you have the credit. I have done a lot of comparison with rental and rent vs. buying, and I have found that renters a lot of times they are renting for $950 when they could buy for $700. AVOID HIGHER COST LOANS, call me for a NO COST, NO OBLIGATION PROPOSAL." - Lindsey Murphy, Senior Loan Officer, 507-931-8169 Thursday April 15, 2010 "Well, it's been two weeks since the government has stopped buying pools of Mortgage Backed Securities and surprisingly there seems to be adequate private demand. This is still keeping 30 year fixed mortgage rates between 4.75% and 5.25%. Roughly the same range when there was government support in the market. The not so good news is that the main reason why private investor demand has been enough to keep rates low is because mortgage application volume has been light at best. Less consumers buying and refinancing homes means less loans for sale in the secondary market. This coupled with lower demand means that rates stay the same. So, what happens when mortgage applications pick up? Will there be enough investor demand to buy the loans or will mortgage rates increase to entice more investors? Or, will we even have to worry about it for awhile? Unemployment still hovering around 10%, consumer sediment is low and people worried about keeping their job is enough to keep buyers out of the market, right? Maybe not. 5% 30 year fixed rate mortgages and home prices at multi year lows means that consumers can buy a house with a PITI payment the same or less than most rents. And with USDA, FHA and VA government loans, down payments are not or less of an obstacle." -Steve Page Wednesday March 31, 2010 "Today the payroll company ADP which handles payroll for some of the nation's largest employers, showed that its customers shed 23,000 jobs in March. Analysts for Thompson Reuters expected a gain of 40,000. That's a 60,000 job swing which is relatively significant. Factory orders were up last month with demand for industrial machinery and commercial aircraft increasing. This is the 10th time in 11 months that Factory Orders increased .6%, however, this is quite a bit less than the 2.5% increase we saw in January. What does this mean for the housing market? With investors continuing with their flight to safety will pull more money out of equities (stocks) and buy safer investments such as Treasury Bonds and Mortgage Back Securities. The more demand for these investment vehicles, the lower interests. This should keep consumers buying homes as we push into the heart of the home buying season this spring despite the First Time Home Buyer Tax Credit expiring in April. We also can't forget the Federal Reserve Bank ending their Mortgage Backed Securities purchase program today. Over the last 15 months the Feds have purchased 1.25 Trillion dollars worth of Mortgage Backed Securities in an effort to keep mortgage rates low and spur home buying. While they have succeeded, the Feds has now decided they have done enough and will not purchase addition MBS after today. This leaves us with the big question of... Is there enough real investor demand to fill the vacuum that will be left when the Fed money goes away? Nobody knows, but if I were in the market to buy a house, I wouldn't roll the dice!" - Steve Page Monday March 23, 2010 "There are some key economic reports due out this week from the government that will influence the direction of mortgage rates. We have February's Home Sales figures and Durable Goods orders along with last week's unemployment claims. And at the end of the week is March's Consumer Confidence Index. This is a survey of 5,000 households conducted by the University of Michigan to gauge the level of confidence that consumers have with regards to spending money. While Consumer Confidence is expected to be roughly unchanged from the previous month, both Home Sales and Durable Goods are expected to be down. This should cause investors to shift money to safer investments such as treasury bills and mortgage backed securities. This could give us one last run at 30 year rates approaching 4.5% prior to the end of the government's Mortgage Backed Securities Purchase Program which ends on the 31st of this month. My advice for the week would be to lock your interest rate now before the end of the month to ensure that your deal can close before the end of April which is the last chance to get a Purchase Agreement in place to qualify for the federal government's First Time Home Buyer Tax Credit of up to $8,000." - Steve Page Tuesday March 16, 2010 "2010 Funding for the United States Department of Agriculture's Rural Housing Program is expected to be completely exhausted by the end of April. The program is one of only two no money down programs left for home buyers. The popularity of the USDA's Rural Housing program has soared over the last couple of years as the credit and income guidelines have tightened on conventional mortgages. A similar situation occurred in the 3rd quarter of last year, however the Federal Government approved additional funding at the 11th hour to allow the program to continue. While funding was delayed for a week or so on some loans, the USDA continued to guarantee the loans without interruption. I would strongly suggest that anyone considering using this program to secure financing of their home get a purchase agreement in place as soon as possible. While the prospect of additional funding is not out of the question, it is also not certain. Any purchase agreement should have a closing date prior to April 30th to ensure the best chance of funding." - Steve Page Friday February 26, 2010 "There is quite a bit of economic data coming out next week.... Construction Spending, Pending Home Sales, Crude Inventories, Factory Orders but the one everyone will be eyeing is the Jan. Unemployment Rate. This is a government survey of 60,000 households and 375,000 businesses. From the household side you get your unemployment rate and from the business side you get your Non Farm payrolls or how many jobs were lost/gained. With a recent flight to safety by investors distaste for last weeks unemployment news and today's News that home sales fell 7.2% to the lowest level since last summer, caused bond yields to drop. Government Bond yields are closely tied to mortgage interest rates. This results in today's 30 year fixed interest rate being almost at 4.625%. Bad news next week, especially with the Unemployment report, could give us one last window of opportunity to lock low interest rates before the Fed ends their Mortgage Backed Securities purchase program on 3/31/10. In recent weeks, much has been made of the Feds "Exit Strategy" and how and when to wind down the Stimulus Aid to the economy. A growing opinion is that now is not the time. Does the Fed extend their MBS purchase program? Does Congress extend the First Time Home Buyer Tax Credit for the 3rd time? With Unemployment still hovering around 10% and home sales continuing to decline coupled with no real move in inflation numbers, many believe the economy is not healthy enough to start raising interest rates. I think we will have a much better indication after next week's data. Stay tuned!" - Steve Page Tuesday February 16, 2010 "The Perfect Storm. Lower T-Bill Demand + No Fed MBS = Disaster! In a report just released today, demand for US debt by foreign investors dropped by the largest amount ever recorded. China, our largest debt holder, cut their holdings by $34.2 billion. Japan, the second largest holder of US debt, followed suit with a reduction of $11.5 billion. What does this mean? It means that the United States will have to increase the interest rate offered on Treasury Bills to entice investors to purchase the debt. As I've talked about before, Bond Yields are closely tied to long term mortgage rates. This comes at a time when the Federal Reserve Bank has stated that they will stop buying Mortgage Backed Securities by March 31st. And the Home Buyer Tax Credit is set to expire April 30th. How will this effect mortgage rates? Even if Congress passes yet another extension of the Home Buyer Tax Credit, there simply is no way mortgage interest rates can sustain their current historic lows. Fact is, interest rates will increase incrementally starting sometime in the next 30 days and carrying through the end of 2010. How much is anyone's guess, so get prepared, batten down the hatches and don't underestimate the "Perfect Storm."" - Steve Page Tuesday February 9, 2010 "While a recent "flight to safety" by investors has continued to put downward pressure on long term interest rates, the elephant in the room continues to be the Feds exit on March 31st of the Mortgage Backed Securities market. With the Central Bank ceasing its purchase of mortgage debt, it appears that there can be no way of other investors scooping up amount of buying that the Feds have done over the last 15 months. Less investor demand for mortgage debt equals higher interest rates to attract investors. As much as I'd like to make it as simple as the first law of capitalism, supply and demand, it really isn't. There are other variable that enter into the equation such as the number of homes on the market and other economic news. So the question is how high will interest rates need to go to keep up with investor demand? Possibly not that high. What is the rate tolerance of homebuyers? What is the interest rate "ceiling" that can scare new buyers away? Will home values fall to entice buying and deplete inventory? While everyone has an opinion, no one really knows the answer, however the one point of consensus that everyone can agree on, is that mortgage rates will increase in the short term. A good indication of how much will be the Treasury Bill auctions this week. A good way to gauge the demand of long term, "safe haven" debt (if there really is such a thing anymore), is at what rate of return needs to be offered to unload the notes. 3 year Note auction is taking place as we speak. Again, should be an indicator of current investor appetite for long term debt and may give a direction to mortgage rates. Stay tuned..." - Steve Page Monday February 1, 2010 "Lots of unemployment reports are due out later this week from the Department of Labor. Initial Claims, Continuing Claims and more importantly, Non-Farm Payrolls and the Unemployment Rate. While Initial Claims and Continuing Claims are just one week snap shots of state jobless claims, the Non-Farm Payroll and the Unemployment Rate reports are much more significant as it is the monthly report that is a better indicator of the true unemployment rate. Generally speaking the higher the unemployment rate, the lower the mortgages rates are. Also due out are Auto and Truck sales, Personal Income, Factory Orders, Construction Spending and Consumer Credit. How the market reacts to these reports along with the Unemployment Reports will dictate to a good extent, the direction of mortgage rates. The big question is although we have had two consecutive quarters of economic growth, will unemployment increase, remain at current levels or decline? That's the $64,000 question. If there are more jobs created and we are truly on the road to recovery, then we should see a spike in rates as the government also exits the Mortgage Backed Securities market. Currently, 30 year mortgage rates for very qualified borrowers are hovering around 4.75%. Regardless of the economy, this will steadily creep up between now and March 31st 2010 when the Feds stop their purchase of mortgage pools. How quickly and by how much mortgage rates increase will between now and that time. Stay tuned..." - Steve Page Thursday January 28, 2010 "When the Federal Reserve Open Market Committee met this week, it was no surprise to anyone that their decision to keep the Federal Funds Rate (the interest rate at which banks can borrower money on an overnight baisis) at almost 0%. What was a surprise to some is that it was not a unanamous vote. Of the 10 member board, there was one dissenting vote on this issue... Thomas Hoenig. This irked some investors as it could be a sign that the Feds may raise rates sooner than some economists expected. More relative to mortgage rates, The FMOC also reiterated it feels that the housing recovery will be sustainable without it's help. As some of us may remember, The Feds announced last year that they will buy 1.25 Trillion dollars worth of MBS (Mortgage Backed Securities or bundled mortgages) through the end of Q1 2010. In their recent meeting this week, they stayed the course and confirmed their planned exit from the MBS market on 3/31/10. While banks will pick up a lot of the demand there will be a vaccum left after the Feds exit that will cause a spike in mortgage rates. However, it's not all doom and gloom. While mortgage rates will rise, I expect them to flatten out in the low to mid 6s which is still an excellent rate and should not put the brakes on the housing recovery. It will put pressure on home prices, however, moderately higher mortgage rates combined with lower home prices should still equal steady sales. Bottom line.... Don't wait! The window is closing on the 4s!" - Steve Page Wednesday January 20, 2010 "The economic news this week has not been in line with what analysts and investors have expected. JP Morgan Chase, Citigroup and Bank of America all reported billions in losses due to defaulting consumer debt and repayment of government bailout money which was partially offset by gains made in investment banking. Interestingly enough, Bank of America and Wells Fargo seem to be at odds over the state of the economy. Bank of America says that the economy "remains fragile" while Wells Fargo's Chief Credit Risk Officer, Mike Loughlin, seems more optimistic by saying "While losses remained elevated during the quarter as expected, a more favorable economic outlook and improved credit statistics in several portfolios further increase our confidence that our credit cycle is turning..." This news from our "Banking Cartel" as it seems like it has become, coupled with Single Family Housing Starts dropping 6.9% in December virtually guarantees that when Big Benny B. and the rest of the Federal Reserve Board meet early next week, they will keep short term lending rates at their historic lows. Some additional gloomy global economic news... the Chinese government has ordered some banks to stop lending for the rest of January as they have exceeded credit limits. Not good news coming from the world's second largest economy. What does this mean for mortgage rates? Fixed mortgage rates are closely tied to the bond market. Generally speaking, mortgage rates follow the yield on bonds. When Treasury Bill yields are up, then mortgage rates are up and vice versa. What causes the interest rate paid to T-bill holders to go down? When there are more buyers of the notes than sellers, the yield goes down. When there are more sellers than buyers the interest rate is increased to entice investors. Therefore when we get bad economic news like we did this week, investor's dump stocks and buy more government bonds as they are a safer investment. This pushes the yield down and inturn mortgage rates move in the same direction which is what we are seeing this week. Today 30 year fixed conventional and govie rates are 4.75%, 15 year conventional is 4.25% and 5/1 arm is 3.5%." - Steve Page Monday, January 18, 2010 Real Estate Professionals, Home Buyers and consumers looking to refinance got a break last with 30 fixed mortgage rates pushing off their recent high of 5% and heading back down to 4.75% for the time being. We can thank a strong 30 year Treasury Bill auction and a lower than expected Consumer Sentiment Report. CSR was expected to come in at a reading of 74.0, however actually coming in at a reading of 72.8. Consumer Sentiment is Consumer Survey that is conducted by the University of Michigan that reaches out to 500 households and inquires about their personal finances and their opinion of the overall economic outlook. Looking at the week ahead, Core PPI (Producer Price Index), Housing Starts and Initial Jobless Claims. PPI is the price of goods at the wholesale level, what retailers are paying for the goods they sell. "Core" means excluding food and energy which have a tendency to fluctuate more. Housing starts reelects New Construction, not existing sales and Initial Jobless claims is a weekly snapshot at new unemployment claims. Wall Street is expecting a marginal increases in all of these reports, Core PPI, Housing Starts and Initial Claims. An increase in Initial Claims would be positive for lower mortgage rates, an increase in Core PPI and Housing Starts would not. For the most part Wall Street is expecting the status quo for these reports so the "X" factor possibly effecting rates would be corporate earnings. Being in the heart of earnings season we could see a lot of information that may give us some idea of which way the economy is heading. Just this week alone we have Citi Bank reports quarterly earnings on Tuesday, Bank of America, EBAY, Morgan Stanley, and US Bank reporting earnings on Wednesday. Thursday is American Express, Goldman Sachs, Google and TCF Bank and on Friday it's GE, McDonald's and Merck. To sum it all up, better than expected corporate earnings, lower jobless claims and higher PPI and housing starts should put upward pressure on interest rates. So here's the catch 22... do we hope for doom and gloom or not?" - Steve Page 01-13-2010 - "The Mortgage Bankers Association reported that mortgage applications have risen 14.3% during the first week of 2010. With mortgage interest rates at their lowest point in decades, more and more consumers are able to buy a home or refinance their existing loan to a more affordable payment. Interest Rates are set to rise here in the coming weeks with the Federal Reserve Board's Mortgage Backed Securities (MBS) purchase program set to end on March 31st 2010. This program has pushed mortgage interest rates lower by bringing artificial demand to the market. While the Fed has tossed around the idea of extending this program, different members of the Federal Reserve Board have argued over whether to do so. That being said, the window of opportunity may be closing on 4% - 5% mortgage rates. Don't miss your chance to reap the benefits of record low mortgage rates and enjoy the benefits of homeownership. Give me a call today to get Pre-Approved to purchase a home or to lower your existing mortgage payment." - Steve Page 12-30-2009 - With "Green Shoots" actually looking like they're starting to grow roots, 30 year mortgage rates are starting to push up against 5% again. Home sales are up, unemployment is edging down and the Holiday Shopping season saw over a 3% increase in spending from 2008. Unless we lose ground again on the jobs or home sales front, mortgage rates will continue to rise through this year. Home prices seem to have bottomed, mortgage rates are still excellent and the government is handing out $8,000 checks to home buyers. This very well may be the best time to buy a home... ever! 12-14-2009 - Last week's Treasury Auctions were met with weaker demand than earlier this year, pushing the yields higher. This in turn pushes mortgage interest rates higher as well. Today's 30 fixed rate is 4.75%, still a phenomenal rate. Low rates, tax credits for buying a house and low home prices means it is an excellent time to buy! 12-05-2009 - With investors cautious about a true "recovery" and unemployment topping 10%, 30 year interest rates have pushed to new historic lows. Today, a 30 year fixed rate home purchase or refinance mortgage carries an interest rate of 4.375%. This is an incredible window to buy a home or refinance at rates and payments that may not be seen again. It truly may be a once in a lifetime opportunity. 09-30-2009 - The Fed has announced it will reduce the amount of money it set aside at the beginning of the year to purchase mortgages and push rates down. While this has caused a short term drop to the 4s, it appears that this move would push interest rates higher towards the 4th quarter 09/1st quarter 10. Currently rates on a 30 year are as low as 4.625%... Don't miss it! 09-21-2009 - Depending on the day, we've seen 30 year mortgage rates fall back in the 4s. This is the lowest level for mortgage rates in approximately 3 months. The timing is nice since the last minute rush to take advantage of the $8,000 tax credit has started. Don't miss out! December 1st is the deadline to still qualify. 08-17-2009 - The Federal Reserve Board recently announced that it will stop it's purchase of Treasury Bonds in October. This is important because Treasury yields affect mortgage interest rates. This action should cause a spike in mortgage rates. Also there has been no talk regarding extending the First Time Home Buyer Tax Credit of up to $8,000 into 2010. As the summer winds down, the clock is ticking on being able to still lock in a low rate. 08-03-2009 - So far to date, the government has spent 7.2 Billion of the 1.25 trillion dollars it has set aside to buy Mortgage Backed Securities. This is an effort to keep mortgage rates artificially low. However, this money will run out on or before December 31st of this year. With the $8,000 tax credit for buying a home in 2009, it is an excellent time to starting looking for a house. 03-20-2009 - Mortgage rates dropped Thursday after the Federal Reserve's decision to print 1.2 trillion dollars to inject into the economy. The national average rate on a 30-year, fixed-rate mortgage fell to 4.94 percent, down nearly a quarter of a percentage point from a day earlier, according to financial publisher HSH Associates. 03-18-2009 - Fannie Mae said the volume of mortgage loans it refinanced in February nearly tripled from January. This was due to homeowners who took advantage of low interest rates and higher loan limits. 02-17-2009 - President Obama signed the economic stimulus plan into law making the $8,000 home buyer tax credit official. This credit will be available for some first-time home buyers and will not require repayment as long as the home is not sold within 3 years.