Where R Rates / MBS Market Update
MORTGAGE RATES GET BIG BOOST
As you can see with the red below we were down last week 34 to 88 BPS depending on the product and where you are on the rate sheet. That equates to $340 to $880 worse pricing per 100K in loan size for the same rate from last Monday open to Friday close.
The great news is look at this morning. We are up 25 to 37 BPS depending on where you are on the rate sheet. Why? Honestly, speaking it has everything to do with the election betting polls. That just means what investors are betting on as to what will happen with the election results.
Investors will short different markets hoping to make a big chunk of change. All of our markets are forward thinking which means they make financial investments now based on what they think will happen. Now we are getting really close to Election Day and the markets are going all over the place.
Oil cost is going up, dollar is going down, bit coin is going lower and mortgage rates are going lower. Essentially, the markets are seeing the over-reaction we have seen over the past month + and now the world is getting antsy to see what happens and they are making moves.
We have been in a free fall since September 16th and looking for something to stop the fall and gain some footing to return to better rates. This is the beginning of what could be. I would anticipate a potential volatile day so what I show now as of 8:30 AM Central time may not be the case at 9 or 10 or this afternoon.
Stay tuned to see what happens and I will give you another update tomorrow morning. If you do not receive this every day make sure you click the link above to stay in the know.
| LAST WEEK CONV 5.5% – DOWN 56 CONV 6.0% – DOWN 50 GOVT 5.0% – DOWN 88 GOVT 6.0% – DOWN 34 10 YR NOTE – UP 11 TO 4.38 DOW JONES – DOWN 212 |
| SO FAR TODAY CONV 5.5% – UP 37 CONV 6.0% – UP 31 GOVT 5.5% – UP 28 GOVT 6.0% – UP 25 10 YR NOTE – DOWN 10 TO 4.28 DOW JONES – DOWN 174 |
GREEN is GOOD for Rates – RED is BAD for Rates
Product & Guideline Highlights
EMPLOYED BY FAMILY GUIDES
The rules have changed over the years when a family member is employed by a family business. Knowing which product to choose to make the application flow without issues is key as all agencies do not have the same requirements.
Here are the guides for each agency. On conventional loans this applies to borrowers employed by family or interested party to the transaction like the seller, realtor, broker and anyone that makes the transaction a non-arm’s length closing.
As an example Freddie is beneficial with one year tax return but Fannie is beneficial in what they allow to be used as income.
FANNIE MAE
Must have 2 Years tax returns regardless of how long they have worked for the company. Income must make sense and be supported by previous and current income levels.
FREDDIE MAC
Only requires 1 year tax return OR IRS Wage and Income transcripts.
The documentation must validate prior years earnings and support current years income.
If the current income level is not supported by previous year you must use the previous year’s income.
FHA
Must prove borrower is not an owner in the family business by using official business documents.
Documents include corporate resolutions, business tax returns or other organization documents. An official letter from a CPA on their letterhead will work as well.
In addition to above you must have tax returns and transcripts. It does not designate how many years. That will be lender discretion.
Income used is the standard FHA income calculations for salary or hourly.
VA
VA does not address this in their guides. Mr Cooper treats it similarly to FHA. Making sure they verify any ownership in the property and income must make sense.
USDA
USDA does not have specific guides as they already require two years tax returns and transcripts to verify income. Therefore, they already have the information needed to document potential ownership. Family income can be looked at in more detail than standard employment. Large increase in income with no supporting explanation will need to be addressed and properly documented.
Use this information to market to potential clients as well as educate your referral partners so they have answers when a buyer comes to them to purchase a home.
Jackism of the Day
LIFE CHANGING TRUTH
If you realize this one truth and put it in to place it is guaranteed to change your life.
I am a big fan of discipline, knowing your why, being on mission and getting results in life. This truth applies to all of them.
There are three main areas I focus on in my life which are my Spiritual Walk, my Relationship with my Wife and how I go about Managing my Business.
I can show you my daily discipline matrix and tell you all kinds of ways to find success but if we do not apply this one truth then our lives can fall like a deck of cards when we least expect it.
The concept comes from the word “Economic Denominator”. If you are trying to improve any area of your life you must nail down your “Economic Denominator”. Call it what you like for your marriage, spiritual walk, parenting, community or whatever areas of life that you value the most.
In business the “economic denominator” is defined by what are the 1 to 3 things that you must do to yield your end goals and results. You must have goals before you can identify the denominators that apply to your situation.
For me, in business the 3 things that must happen to create the results and goals I desire are the following:
#1 – THIS MORNING UPDATE you are reading right now. One of my goals in business is to impact lives in helping people achieve better results both in business and in their personal lives. This morning update connects you and I on different levels. On the markets, in knowing industry guides and the true reason I write this entire update which is for personal life change. My Jackism is my passion. This is how you get to know me and how I grow my presence in your life as well as where most of you call me to do business with me as a rep with Mr. Cooper where we get to know one another.
#2 – REGISTRATIONS – I am a 100% commission employee. I am in sales. Personally I think everyone is in sales regardless of your title. If I do not receive loan registrations from my partner clients it is impossible for me to close loans. No matter what I do after the registration I must first receive them from you.
#3 – GENUINEAVAILABILITY – When you have a need I must deliver. I can get all the registrations you have but if I am not here when you need me then the glue you need to bond in a relationship simply is not there. We eventually fade away when my products and support staff do not fulfill your needs.
If I do not do these three things my house of cards will fall. If I do them and then build on them then there is no end to what we can accomplish together as client partners.
This week my wife and I were having a few communication issues. She was saying a few things in a tone that I felt disrespected. Nothing bad at all. Just that little thing that bothers you and I let it get to me. As I was praying over her during my quiet time I was thinking about my economic denominator in my marriage and it was at that point I realized why I felt the way I did. This week I had let go of the core denominator of my commitment to my wife and it disrupted our marriage for a day or two.
I have a favorite verse I absolutely live by in my marriage. It is Ephesians 5:25-27. This is my version of it.
Husbands (Jack), love your wife as Christ loves the church, giving myself fully to her (Misty) by washing her with the Word (Prayer) and presenting her (Misty) to himself (Jack) without blemish, without wrinkle and without stain and see her (Misty) as holy and completely blameless.
Oh SNAP! Even if you’re not religious this is a solution regardless of what you believe.
The #1 denominator that must come first is I must love my wife unconditionally, without blemish, without wrinkle and without stain. Period! I had forgotten that for a couple days. I refreshed myself and reminded myself and I saw her, I apologized for not loving her for exactly who she was. It is amazing how our tones come in to line when our only task is to love someone unconditionally. My problem annoyance disappeared the moment I reminded myself of the core denominator our marriage is built on.
Lastly, as I look at my personal spiritual walk and for you it may be spiritual or whatever you find solace and peace and contentment in. It does not matter about my quiet time, my disciplines, my reading of whatever it may be. Without the #1 denominator everything else does not work as well. For me that is prayer. Without that intimate relationship with Him all the cards fall.
What areas of your life do you need guidance in? Do you want to see better results? Do you want to improve in?
Start first with what your end goals for that area are. Then ask yourself. What must I do consistently which is typically every day to obtain those results? Forget the fluff and get to the stuff. If you are the greatest potential basketball player in the world but don’t know how to dribble you will never score a single point.
What is fundamental to your life to gain success and achieve your desired goals?
Mine is prayer, unconditional love, being a genuine and available person that reaches out to you and where I receive registrations that can eventually become closed loans. With one sentence I have an abundant life in three areas of my life.
Don’t complicate things. Realize who you are, where you want to be and what you must have as your core denominators of life that will get you there.
Then perfect and do those without fail and I guarantee your life will change for the better.
Go ahead, do it, stop right now and answer the question. What must I do in the three most important areas of my life to achieve the goals and results I desire? You already know the answer. You just may not be doing it. So, do it : )
