Where R Rates / MBS Market Update

FED RESULTS IMPACT

We are starting the day off quite nicely after yesterdays Fed Meeting Notes and Press Conference. Some of the notable items they mentioned was pausing on quantitative tightening which is a fancy word for not reinvesting the bonds that mature in to more bonds. Quantitative easing is where they buy a bunch of bonds which creates demand and lowers rates.The pause is good for mortgage rates.They also down played the impact of tariffs and how it will impact inflation. They expect two rate cuts by end of year and did not cut yesterday as expected.

On a technical trading perspective which means where the market hits a certain level in trading where investors see an opportunity to cash in and they sell which causes bonds to get worse OR when you are up against a ceiling it is an opportunity to break through that ceiling into a new trading window which we are doing this morning and making that ceiling of resistance in to a floor of support. If we can stay where we are for a couple more days then investors look for the opportunity to stay in, not sell and therefore create demand which betters our rates.

It’s a toss up on the technical side and we will wait to see what happens. We have only been this high two days since October.

Not much market moving results today. Jobless claims came in pretty much as expected. We do have a 10 Year TIPS Auction at noon today.

Let’s see if we can hold this window and hope for the best.

GREEN is GOOD for Rates – RED is BAD for Rates

Click Here to Understand BPS

Product & Guideline Highlights Ad Mortgage Products

CLASSIFYING RATE / TERM

Sometimes it is the little things that we tend to forget that is important depending on what product to use.

We all want to classify a refinance as a rate and term in order to take advantage of LTV and pricing hits for cash out.

Sometimes going FHA will save a deal when conventional is not offering what you need.

With Fannie and Freddie you cannot payoff a second lien as a rate and term unless the second lien was used to purchase the property. This limits your pricing and LTV when a second mortgage is involved.

With FHA as long as the second lien is seasoned for a minimum of 12 months you can pay it off and take advantage of 97.75% LTV and better pricing. If you have a HELOC on the property then the amount that they have not taken a draw on in the last 12 months can be considered rate and term. Any amount drawn in the last 12 months would require to be paid off at closing or be done as a cash out.

On the AD Mortgage Non-QM products a big advantage is that we treat junior liens as a rate and term when they have been seasoned for 12 months. Same rules as FHA and it opens up the available products to clients.

We did a lot of second mortgages over a year ago. Now may be a good time to consolidate those loans.

As an FYI AD Mortgage also does second mortgages on a 30 year fixed amortization. Do one now and give yourself a loan to rate and term 12 months down the road.

Use what you have to better serve your clients needs. Each scenario is different. Got questions? Feel free to reach out any time. Just hit reply and it will come right to me.

Jackism of the Day

REFRESH RATE

So I ask you this question my friends. How fresh are you?

Hmmmm, that is an interesting question there Jack. My oh my, what do you mean?

So I was on my daily walk pondering life and chatting it up with the man upstairs and realized how I needed those few minutes to clear my head and to get back in tune with my inner self and who I desire to be to myself and to those that I serve.

For some reason refresh rate clicked in my head. A TV or monitor is measured by its refresh rate in Mega Hertz MHz. 

60 is your standard monitor and tv that gets you by. Then it goes up to 120, 160 and some of your gaming monitors go up to 500 MHz. 1 MHz equals one refresh per second. The better your refresh rate is the more smooth your screen will be as well as how clear the picture is as it goes from one scene to the next.

We are a lot like tv’s and refresh rate.

When we have a quiet time in the morning, maybe take a quick break at lunch to eat something or an afternoon walk or exercise to get away for a moment. These are all parts of our refresh rate for ourselves to give us some time to make sure we are maintaining the level of who we are in order to best serve those around us.

The more you keep yourself in tune with who you are the better the experience others will have around you and the better experience you will have yourself.

People use different versions of refresh. I use a lot of time in prayer just being grateful and thankful for what I get to do and just chatting it up with Him to stay clear and focused on who I am and what I want in life for myself and for others.

Some people stop and meditate multiple times per day. Some take a quick walk around the block or the house to focus. Others exercise in the afternoon for their lunch time to regroup.

However you refresh yourself today I just wanted to let you know that your refresh rate matters. It matters to your quality of life and it matters to those that are around you.

The longer you go without refreshing the worse you will come across to others. The more you refresh yourself the more others around you will smell that sweet aroma.

Ask yourself today, do I refresh myself enough? What can I do to increase my rate and see if it makes a difference in your day and the day of others.