Where R Rates / MBS Market Update
RATES HIT TODAY
Last week from Tuesday open (Monday was a holiday) to Friday close we were down a little bit although nothing overly substantial. This morning we are seeing a lot of red on the screen though.
With last week’s light news week and today’s light news it seems that the smaller things are impacting the markets at higher levels.
Today and truthfully this entire week is a light market news week with no big indexes coming in domestically. We are prepping for a big November with the election, the next Fed meeting, jobs reports and inflation reports coming in. All of these could make a large impact on mortgage rates.
Part of the reason for the red this morning is the global impact with foreign yields rising. That is similar to the 10 Year Treasury increasing. If those yields meaning they have to pay out higher returns to maintain investors is increasing then in order to keep the demand on our bond sales we have to increase yields as well.
In addition, now oil prices are increasing which is a standard for an increase in inflation due to the impact oil has on the entire world. Last week they were going down and now they are going up a little and each one can lower or raise bond markets.
Stay tuned to see how the day turns out.
| LAST WEEK CONV 5.5% – DOWN 10 CONV 6.0% – DOWN 9 GOVT 5.0% – DOWN 23 GOVT 5.5% – DOWN 15 10 YR NOTE – UP 3 DOW JONES – UP 475 |
| SO FAR TODAY CONV 5.5% – DOWN 25 CONV 6.0% – DOWN 14 GOVT 5.0% – DOWN 30 GOVT 5.5% – DOWN 17 10 YR NOTE – UP 6 TO 4.13 DOW JONES – DOWN 59 |
GREEN is GOOD for Rates – RED is BAD for Rates
Product & Guideline Highlights
FANNIE / FREDDIE DIFFERENCES
From time to time I like to send out common guideline differences between Fannie and Freddie.
Here are a few of the differences between the two.
ALIMONY PAYMENTS
FANNIE – You may count the alimony payment as a monthly debt OR deduct from the income.
FREDDIE – You must reduce the income by the amount of the alimony.
APPRAISAL WAIVERS
FANNIE allows on investment refinances. FREDDIE does not.
CASH-OUT REFINANCES
FANNIE – If DTI exceeds 45%. 6 months reserves required.
FREDDIE – No DTI limit. LP decides reserve requirement.
CASH-OUT ON RATE AND TERMS
FANNIE – Lesser of 2% of loan amount or $2,000.
FREDDIE – Greater of 1% of loan amount or $2,000.
COLLECTIONS
FANNIE – 2-4 units or 2nd homes. Collections exceeding 5K must be paid off. Investment properties that exceed $250 for one account or $1,000 aggregate must be paid off.
FREDDIE – Included in the assessment within LP. No specific guides.
MAX DTI AUS WILL APPROVE
FANNIE – 50.00
FREDDIE – 50.49
MORTGAGE NOT REPORTING ON BUREAU
FANNIE – Must get payment history.
FREDDIE – Ok with no history if ACCEPT.
RESERVES FOR MULTIPLE OWNED PROPERTIES
FANNIE – Reserves based on % of unpaid balances.
FREDDIE – Reserves based on # months of PITIA.
SELF-EMPLOYED # OF YEARS REQUIRED
FANNIE – Is possible to have one year on AUS.
FREDDIE – Must be S.E 5 years to use one year return.
STUDENT LOANS
FANNIE – When no payment exists can use 1% of balance.
FREDDIE – When no payment exists can use .5% of balance.
These are not all the differences. They are some of the good ones you may want to share with clients and referral partners to show you are in the know.
Jackism of the Day
FEAR OF HAPPINESS
Do you feel guilty when you are experiencing a time of happiness in your life? Where you feel good and content and when you look around you hope that life can be this all the time?
For those that are gifted to sit in that moment and stay in that moment you are truly blessed. For those of you who tend to fear losing that moment, the word is Cherophobia.
Cherophobia is the fear of happiness or general life satisfaction. It is more common than we may realize.
I regularly find myself in moments where I am praying over my wife and family and experience such an appreciation for who I have in my life. The love I have for my wife as I watch her doing something around the house and she does not know I am even looking. The joy of living a minimalist lifestyle as I pull up to our little 1,500 square foot townhouse, the joy I feel when my children call me on the phone almost daily at the ages of 25 and 27. The contentment I have with my job and how I can make a difference. Then of course, the absolute joy I find in spending time with my Lord all throughout the day is my greatest gift.
These are the moments that I cherish so much in life. Just being content and at peace with the simple and wonderful things in life.
Then the small feelings of cherophobia creep in. I allow the world to take my mind and think of the ways that this happiness could be taken from me. Losing my job, getting that knock on the door only to open it and see a police officer on the other side asking me if I am the father of one of my children, the harmony of my marriage finding a rut or rough spot or maybe God wants to teach me a lesson and will depart from me in some way or another.
It’s almost like this world does not allow or want us to be completely happy in our life. It says that sure you say it but do you really experience it. We have been molded by reality tv shows and all the fake posts and pictures thrown up on the social media sites. We have been trained to think that true happiness does not exist and it is not real.
We have actually been trained not to show true happiness and contentment to others because it is seen as boasting, prideful and egotistical.
If you wear a shirt that says I love my wife or I love my husband. The comments you receive are I bet they bought that shirt for you. Or if you are hanging with your buddies and someone asks how your wife is doing and you respond with, I love that woman as she is the greatest gift God has given to me. They respond with a blank look on their face and say, yeah right, they are a gift alright but sometimes one they would like to return.
True happiness does not need to be posted on social media or boasted about in conversations. True happiness is ok, it is allowed, it does not mean that the other shoe is going to drop in the next few moments.
Do not feel guilty that you love your spouse, enjoy your children, are thankful for your job, embrace your community and grow in your hobbies you truly want to do.
I am writing this article because I think I have a form of cherophobia. I find myself being very careful about not over indulging in being appreciative for what I have. I feel unworthy sometimes of the people and blessings in my life. I feel I do not deserve the people in my life and something is going to happen to take it away.
Then I come to terms and realize these are lies. Of course, life will not ever be perfect and all hunky dory. I will disagree with my wife, my children will annoy me, my job will cause stress and ask myself why I am in this business and my community will let me down as I will let them down as well.
Having these moments where life is not all that is what makes truly enjoying the times of happiness all the more. When happiness, peace and contentment are the norm and conflict is the exception it is ok to say this is good and to appreciate without fear the happiness in our lives.
Don’t be afraid of the good moments in your life. Do not worry about losing those feelings and moments. They are yours, they are now, they are allowed and they can and will be a big part of your life when you allow them to be there and appreciate them while you have them.
