Where R Rates / MBS Market Update
IT’S FED DAY
We are all looking forward to the comments that Chairman Powell has at his press conference this afternoon following the 1 page summary of what was discussed the last two days at this months Fed meeting.
Although, the Fed rate change is expected to be no change which limits the impact of the Fed Meeting. It is the thoughts and the mindset of the Fed of how they will move forward that can impact the markets.
Important comments will be around fiscal policy changes from the Trump Administration and how the Fed reacts to the changes and their expectations. This will be good intel as they have been on blackout period due to the Fed meeting since the inauguration.
We do have green on the screen yesterday and this morning but in minimal amounts so the markets have been steady the last few days.
Week over week mortgage applications are down 2%. Refinance applications went down 7% and purchase transactions decreased by .4%.
The average 30 year fixed rate stayed the same at 7.02% week over week which shows a steady market for at least the past 7 days.
The fun starts today at 2 PM Eastern and the press conference is at 2:30 PM so if we do see market changes it will likely be later this afternoon.
Tomorrow is GDP which is a big deal and Friday is PCE inflation numbers.
For those of you that are clients of mine I hope to see you at today’s level up webinar on reading MBS charts and understanding how this market works at 11 AM Eastern today. You should have received a reminder email to sign up this morning.
Sorry folks, my weekly level up webinars are for clients only.
Have a great day all!
| YESTERDAY CONV 5.5% – UP 3 CONV 6.0% – UP 6 GOVT 5.5% – UP 6 GOVT 6.0% – UP 9 10 YR NOTE – DOWN 0 TO 4.53 DOW JONES – UP 136 |
| SO FAR TODAY CONV 5.5% – UP 12 CONV 6.0% – UP 6 GOVT 5.5% – UP 6 GOVT 6.0% – UP 3 10 YR NOTE – DOWN 1 TO 4.52 |
GREEN is GOOD for Rates – RED is BAD for Rates
Product & Guideline Highlights
OWNERSHIP VS BORROWER
One of the more confusing items is understanding the rules of who can refinance a home when they are not currently on the loan that needs to be refinanced.
This has changed from time to time over the years and is a little more simple than many may think.
If you are doing a rate and term refinance for a borrower and lets say the mortgage is in the wife’s name only and she is the only one on title. For whatever reason the wife can no longer be on the loan and you need to refinance that mortgage. Assuming it is not a bailout where the mortgage is currently delinquent.
You simply add the husband to title and you refinance the existing mortgage in the husbands name. Fannie just rolled out recently that the husband would need to be on title prior to application. Previously it was must be on title prior to closing. Not sure of the reason for the change honestly but tis what it tis.
Technically speaking the wife in this scenario could sell the property to the husband. I will say this is frowned upon although it is technically not illegal. Lenders do not like this as much as it is circumventing cash out requirements by doing it as a sale vs refinance. Rate and term vs purchase is not as big of a difference.
If both husband and wife are on title and only one is on the mortgage you cannot do a sale in that situation. You can do a rate and term though in the persons name not on the current loan.
This works for FHA loans as well. Pretty much the exact same scenario as above applies to FHA on rate and term refinances.
There is a difference on cash out loans though. For Fannie you must be on title for 6 months in order to do a cash out loan. As a reminder if there is a mortgage on that property it still must be seasoned for 12 months in order to do a cash out loan per the agency guides. If it is free and clear then only 6 months are required.
On a side note. Since we just rolled out manufactured housing I found out that manufactured housing requires 12 months seasoning from the agencies vs the 6 months for stick built homes.
On FHA for cash-out you need to own and occupy the property for 12 months in order to be eligible. Many think you must be on the existing mortgage. The only requirements are owned and occupied and you do not have to be an existing borrower and your mortgage must be due for the current month.
This could be a good marketing piece for those in the community who may not think they have options when in fact they do.
Jackism of the Day
YOUR GREATEST ASSET
What is the most important and greatest asset that you have in this life?
This past Monday and Tuesday I spent two full days at the corporate offices of A&D Mortgage. A&D Mortgage is going to acquire Mr. Cooper aka Flagstar broker and non-delegated division effective April 1st.
To say that I am excited is an understatement. What we are going to build here is going to be something that does not exist in the market place at this moment. It is the making of the ultimate lending machine and it is exciting and fun to be a part of.
In listening to their executive team, hearing from their managers, meeting with the people in the offices that get all the work done they are all on the same mission. Yes we can is essentially their model.
Then a really interesting aspect of what they did the last two days with our entire team in their offices. They listened. They asked questions. They said what will make us great. They emphasized what will make us great is us. The people. All of us, them, us, we. It was more than an idea. It was a statement and I believe them.
Combining the #1 Non-QM lender in the country with Flagstar which is one of the best and most knowledgeable agency and govt lenders in the country with next to no overlays and pricing. While we keep all servicing and do zero marketing to closed loans where leads go back to you and then an operating system built from scratch with 143 IT software developers, engineers and technicians on staff with a single focus of being the best of the best for our clients is going to create something special.
One of the inspirations I received this past two days is that the most important thing you got in life is the asset and the ability to give.
To give. To give of yourself. Of your talents, of your knowledge, of your abilities, of your time, of your personality, your commitment, your attitude, your joy, your peace, yourself.
You know how you make something great? You make it by great people coming together with a great attitude, great mission and great knowledge and then the result has the ability to be great.
We have an unpaved road ahead of us in certain areas and yet we have a road paved with the best of the best already there and being driven on, tested, tried and secure that gives one of the greatest foundations I have ever seen in this industry.
Folks, get ready to experience something special. I am going to be a part of it by giving myself to this new organization and I hope to see you there right next to me experiencing and being part of a new generation and a new industry as we move forward in to this next season.
Where are you giving the gift of yourself in your life today? Where is there a need for more of you in others lives that are around you. Your company, your family, your friends, your community. To give the gift of yourself to others can be the greatest reward you will ever receive.
