No Bull Agent

Mortgage Rate Update for the Week of July 11, 2010

Information in this post is provided by Greg Wickstrand, Home Loan Consultant for HomeServices Lending.  He is a guest blogger who provides us information from a lender’s perspective.  For additional posts by Greg, please visit his BLOG.

What’s Ahead for Mortgage Rates this Week:  July 11, 2010
By:  Greg Wickstrand

Mortgage markets improved again last week — if only barely — throughout a holiday-shortened week devoid of “major” data and market conviction.

Up-and-down trading characterized the week which ended with mortgage rates slightly lower versus the week prior.

Mortgage rates have fallen in 4 consecutive weeks and are on an extended rally that dates back to mid-April.

This week, however, data returns and rates could reverse. Especially with inflation numbers are in play.

Inflation is the enemy of mortgage rates.

Inflation is bad for mortgage rates because mortgage rates based on the price of mortgage-backed bonds.  When inflation pressures mount, the demand for mortgage-backed bonds wanes and that pushes bond prices down which, in turn, pushed bond yields (i.e. rates) up.

There’s three pieces of inflation-related news this week.

The first inflation-related story is the Federal Reserve’s Wednesday release of the minutes from its last meeting. Now, when the Fed adjourned June 23, it said “underlying inflation has trended lower“. However, there was more to the conversation that what the FOMC released in its post-meeting statement.

Markets will be looking for clues.

Then, Thursday, the Producer Price Index is released. Read the rest of this entry »

Tags: greg wickstrand, july 11, kaplan, Lending, market, mortgage, nobullagent, rate, update

Mortgage Rate Update for the Week of July 6, 2010

Information in this post is provided by Greg Wickstrand, Home Loan Consultant for HomeServices Lending.  He is a guest blogger who provides us information from a lender’s perspective.  For additional posts by Greg, please visit his BLOG.

What’s Ahead for Mortgage Rates this Week:  July 6, 2010
By:  Greg Wickstrand

Mortgage markets improved last week as economic data revealed a slowing U.S. economy.

Major stock indices fell to 2010 lows in response to a weak jobs report among other data points, forcing worldwide investors into the relative safety of U.S. government-backed bonds.  This category includes mortgage-backed bonds and the extra demand helped to drop rates.

Once again, mortgage rates improved and Freddie Mac is reporting new all-time lows on three popular, conforming loan products:

• The 30-year fixed rate mortgage
• The 15-year fixed rate mortgage
• The 5-year adjustable rate mortgage

Low rates mean low payments and you can’t know your options until you ask.

This week, mortgage rates may move slowly. There’s very little data set for release because markets were closed Monday in observance of Independence Day, and because the second calendar week of a month is traditionally data-slow. Read the rest of this entry »

Tags: california, home buyer, interest rate, july 6, kaplan, Lending, market, mortgage, nobullagent, san diego, update

Is the First-Time Home Buyer Tax Credit Extension Necessary?

President Obama is expected to sign an extension, approved by the House and Senate, to the June 30 first-time home buyer tax credit deadline.  Why is this extension important and is it necessary?  The simple answer is “yes” to both questions.

The original timeline for the first-time home buyer tax credit, as detailed in our previous post, stated that a home buyer must be in contract by April 30, 2010 and close by June 30, 2010 to be eligible for the credit.  Many first-time buyers positioned themselves to take advantage of this credit which is evident by the increase in sales during the month of April.  The current challenge is getting some of these transactions done in the 60 days previously given between the two deadlines.  This timeline can be especially short considering short sales are still taking, on average, from four to six months to process.

There are many opinions as to why short sales take so long.  The general consensus is that lenders are playing “catch-up” to the mass influx of these transactions, are short staffed and are reworking their processing procedures on the fly.  This extension is important and necessary for these buyers who need the additional time, for no fault of their own, to complete their transactions.  Read the rest of this entry »

Tags: buyer, california, credit, extension, fraud, home, inmate, kaplan, nobullagent, san diego, Tax