Posts Tagged ‘mortgage shopper’

Market: We’re down another 9bps today, over 100 from Monday’s open.  Today, if things hold, we’ll see four straight days of red candles on the chart.  As previously mentioned, there has not been a five-red streak on the bond market for more than three years.  Records are made to be broken, but…

Analysis: Economic news has been less bad than expected for most of the week.  The gummint is auctioning off $75 billion in treasuries next week. Traders are still vacationing coming into the fall session, and Congress is about to go on recess.  Combine all this, and the markets are less jittery than they were, which pulls money from bonds and puts it into stocks, making interest rates rise.  That’s the explanation.

The real question is: is the recession over?  Newsweek says so, for what that’s worth, and there are some signs that we may have reached the bottom of the trough.  Personally, I’m not so sure.  If by “the end” you mean that things are not going to go on getting worse forever, and that we are seeing a slowdown – even a stop – in the decline, then perhaps this could be the end.  If by “the end” you mean that the economy is going back on the offensive and a recovery has begun, then no, I think you’re out to lunch.  Most people think of the end of something as the point where that something stops and something new starts up.  By that definition, not only is the recession not over, it hasn’t really gotten started yet.

Lessons should be learned from the Great Depression, which this recession mimics in many ways.  The decline was steep and sudden, but that’s what we usually call a “crash”.  The thing that put the “Great” in “Depression” was the length of time before things came back to where normal would have been.  That’s what makes me more cautious here.  I think it likely that we could be in this trough a very long time.  It takes some years to undo the calamity we spent 30 years getting into.

Keep saving, keep paying off your debts, keep working even if you don’t have anyone paying you.  That’s the way out, no matter what the broader economy is doing.

Cj

P.S. Apropos of this, I’ve finally posted something that’s been percolating for a few months.  It’s called The Most Important Post of My Life, and I’d be grateful if you’ll take a second to read it.

NOW we’ll fix the housing mess!  No, my friends, no.

Regulations that go into effect August 1 make quick closings impossible and will do nothing whatever to stop future foreclosures.  They involve waiting 3 days from the initial disclosure to order the appraisal, followed by a mandatory 3 day waiting period from final disclosure to the close.  This adds at least 6 business days to the loan process and will make only one thing happen: more fraud.  That’s it.  It won’t help the borrowers, and it won’t help the sellers, and it won’t help any of the other people involved, myself least of all.  This raft of foreclosures is supposed to make it so people understand better what they’re doing at the closing table, so they don’t default on their loans as often.

Cue maniacal laughter here.

I’m telling you that less than 1% of foreclosures are because the people getting the loans didn’t know what they were doing.  Effectively all the foreclosures in the US are because of the following, in descending order of virulence:

1. The house is upside down and it makes financial sense for the borrower to walk
2. The borrower lost his job
3. The borrower got overleveraged in multiple properties, which he now cannot sell
4. The loan adjusted and the new payment is out of reach

Those are the reasons people are being foreclosed on.  The only possible group that might have been unaware of what they were doing is the last one, and I can tell you from front-line experience, these people DID know what they were doing, they just miscalculated the risks and got bit.  There’s not one thing – not ONE – in this entire piece of legislation (HERA, for those interested, named for the Greek goddess of jealousy and micromanagement) that makes consumers safer or better off.

Let me emphasize something here: I already did all the stuff that HERA tells me to do.  My clients are all told the first time we sign disclosures that if we have agreed on a deal, whatever we agreed to at the beginning will be what we get at the end.  I urge all my clients to bring their original Good Faith Estimates to the table when they close, and if they don’t, I do.  I go through the whole thing line by line.  None of this new legislation makes me a better loan officer, it just makes me slower at it.

Sigh.

Market: We got hammered today because…well, because.  We’re down 59bps at the moment, and you can thank us here at the Chris Jones Branch of City 1st that it isn’t worse.  It was worse, but we fixed it.  I will tell you how below.  This translates to a rise in rates of .25% over the past two days.

Analysis: Employment numbers came in right in line this morning, followed by home sales numbers that are so anemic they’d be confined to bed in any other market.  The stock market euphorically rose to over 9000 on this news.  Whatever.  Who can analyze this stuff?

But I know how to control it.  This has been tested so many times now that it’s as good as proved.  We know here at the office that when we lock a loan, we reverse the market (this only works when the market is tanking).  In the last two weeks we’ve done it several times.  The market starts to fall, so we call up one of our loans and lock it.  The second we do, the rally begins.  Happens 100% of the time.

Why didn’t we do something about the terrible crash of Black Wednesday two months ago?  Funny you should ask.  We TRIED.  Lenders stopped accepting locks, so we couldn’t get one down.  We sent in the request, and it was eventually honored – at the open of the market the next day, which sparked the largest up day for bonds in several years.  I’m telling you, it’s a curse having this much responsibility.

But I promise you I will use it with discretion and wisdom.  I also promise that your personal loan will not be the one we sacrifice on the altar of the gods of mortgage rates.  We’ll get someone else.

Cj

P.S. Thought I’d again thank all of you for following me, and let you know that it matters a great deal to me.  Today I picked up a gig writing for the Scotsman Guide, somewhat because of RateWatch.  You are all very important to me, and you do get service that’s not available to just anyone.  Thank you again, and welcome to our new signups.  Hope you like it here.

Here’s another edition of Jimmy Rex’s Top Ten Deals of the Week:

While I didn’t find quite as many deals this week as I would have liked to, a few of these deals are some of the best that I have seen all summer.  Homes are selling and buyers are walking into unbelievable deals.  Call me or email me back if you want to know the value of your home in this market or if you would like to see the weekly # of homes that are selling in your county, city, and area. Thanks!

TOP 10 DEALS OF THE WEEK!!!

1. Draper- 2027 sq ft- $137,500- needs some but minimal work

2. Cottonwood Heights- 4,322 sq ft- $274,900- Bank Owned

3. Lehi- 3,866 sq ft- $234,800- bank owned

4. Herriman- 2,468 sq ft- $201,000- bank owned (One of my clients is already offering on this one, sorry)

5. Draper- 6,516 sq ft, 1/2 acre – $459,000- Trying to avoid foreclosure, needs an offer quick

6. Provo- Triplex on Center St., rents for over $1700/mo. – $234,000

7. West Valley- 2707 sq ft- $105,000- Bank owned, needs some work

8. Draper- 3,050 sq ft- $219,900- built in 2006, priced well below any comps (Not a bank sale)

– Please pass this along to anyone you know that might be interested in buying or selling a home in the next 30 days.  I would love to show them any of these or any other homes that they may be looking for.

Jimmy Rex

Realtor/Keller Williams Realty

cell: 801-979-4506

fax: 801-405-6737