The circus like atmosphere continues in the mortgage industry as we try to figure out daily what is going on with mortgage rates. This article on CNBC.com (http://www.cnbc.com/id/23724112) addresses this real fact. That not only is it hard to predict what rates will do, we are now having a problem knowing what it is that makes the rates do what they do.
What are making rates move today? Is it the latest cut by the Fed? Is it the stock market making a rally? Is it yet another increase in the price of gas? Who knows? Not the experts. "The reality is that it used to be relatively easy to predict where mortgage rates were going to go," says Mike Larson, real estate analyst for Money & Markets, a business website. "You keep your eye on things like the broader economy. More recently, it's been almost impossible to predict. The thing that's going to make a lasting impact on mortgage rates is whether you can get through this period of credit turmoil." You got that right Mike.
The motto at the office is "Like the Michigan weather, if you don't like the rates, just wait 5 minutes. They'll change!". And that is true! It is common for us to get rate sheets in the morning and then a reprice in the afternoon. It's funny how fast mortgage officers will move to save 25 bps on their yield spread. Certainly makes the day exciting.
Mortgage rates, like the economy, will stabilize. Until then, we'll read everything we can to help us advise our clients concerning rate locks. Their protection is the most important thing we can do.
I'm just hoping someone is out there trying to protect us in the mortgage business.
If you have any comments on this article, I would love to hear what you have to say! Feel free to comment below.
Thanks for reading!
Dan Tenchall
Great Lakes Mortgage Funding
For FREE Mortgage tips, Mortgage Calculators,must have articles and much more please visit my website!
Michigan Mortgage Rates
(586) 532-0600
dan@glmf.com
Sunday, March 23, 2008
Friday, March 7, 2008
Can You Have Your Cake And Eat It Too?
In this article on www.cnbc.com (http://www.cnbc.com/id/23520031), it was reported that Countrywide's CEO Angelo Mozilo told a congressional panel that the tightening of mortgage guidelines has gone to far. Mozilo was quoted as saying "For the market to recover, underwriting guidelines need to strike a better balance between providing borrowers with access to loans and lenders and investors with the assurance that these loans will be repaid." That's a great point but who is going to make the first move?
Everyday the challenge for us in the mortgage business is to find something that works for our clients. And everyday it gets harder and harder. We have to remember guidelines from Fannie Mae and Freddie Mac as well as each individual lender we work with. What works today may not work tomorrow. What you told your client last week may not be true now. And forget about constant changing rates. You think gas prices are crazy? Try quoting a 30 year fixed rate to someone only to find that rate moved .50% for the worse. That's a phone call you don't want to make. Now, let's talk appraisals.....
Mr. Mozilo made a real good point in his speech before the congressional panel. "I also want to strongly suggest that traditional guidelines be reexamined relative to the appraised value of a home versus the outstanding mortgage so that current borrowers can refinance at lower interest rates," he said. Now that makes sense. It so sad to see people lose their houses because the values nosedived and now no lender wants to refinance them because these poor people are "upside down" (owning more than the market value of their house).
It's not their fault that values have gone in the tank. Nobody had a problem lending money to them to buy the house but now these same people are a "bad investment". The homeowners that are "upside down" should be able to refinance like anyone else.
If these folks don't get help, "upside down" will just be the first move in this real estate tumble.
If you have any comments on this article, I would love to hear what you have to say! Feel free to comment below.
Thanks for reading!
Dan Tenchall
Great Lakes Mortgage Funding
For FREE Mortgage tips, Mortgage Calculators,must have articles and much more please visit my website!
Michigan Mortgage Rates
(586) 532-0600
dan@glmf.com
Everyday the challenge for us in the mortgage business is to find something that works for our clients. And everyday it gets harder and harder. We have to remember guidelines from Fannie Mae and Freddie Mac as well as each individual lender we work with. What works today may not work tomorrow. What you told your client last week may not be true now. And forget about constant changing rates. You think gas prices are crazy? Try quoting a 30 year fixed rate to someone only to find that rate moved .50% for the worse. That's a phone call you don't want to make. Now, let's talk appraisals.....
Mr. Mozilo made a real good point in his speech before the congressional panel. "I also want to strongly suggest that traditional guidelines be reexamined relative to the appraised value of a home versus the outstanding mortgage so that current borrowers can refinance at lower interest rates," he said. Now that makes sense. It so sad to see people lose their houses because the values nosedived and now no lender wants to refinance them because these poor people are "upside down" (owning more than the market value of their house).
It's not their fault that values have gone in the tank. Nobody had a problem lending money to them to buy the house but now these same people are a "bad investment". The homeowners that are "upside down" should be able to refinance like anyone else.
If these folks don't get help, "upside down" will just be the first move in this real estate tumble.
If you have any comments on this article, I would love to hear what you have to say! Feel free to comment below.
Thanks for reading!
Dan Tenchall
Great Lakes Mortgage Funding
For FREE Mortgage tips, Mortgage Calculators,must have articles and much more please visit my website!
Michigan Mortgage Rates
(586) 532-0600
dan@glmf.com
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