Where R Rates / MBS Market Update
HOUSING EMERGENCY
We continue to have green on our charts below which is a good thing. We did lose some ground from where we started the day yesterday although a day in the green is a good day.
Stocks had another great day yesterday up 538.
We have another slow news day and no Fed Speakers as they are in the blackout period. Trump had a broad statement yesterday about an emergency situation with the cost of housing which is good because that means it is a hot topic. It is likely how to build for less to offer more to buyers. We shall see where that storyline goes.
Mortgage applications to purchase a home were up .6% week over week and applications to refinance were down 2.9%. This is after last weeks surge of 33% increase in mortgage applications so the fact it was not way down means applications are doing very well. Go get em folks!
We do have a 20 year bond auction at 1:00 today which will give us an idea of the demand for fixed rate securities with all the changes with Trump.
From a technical trading perspective we are hitting up against a ceiling of resistance and we will see if we can push through it in to a new and better trading window but we will need data or news that will help us push through vs bounce back down.
Only time will tell and I will be right here tomorrow morning to let you know how the day went.
| YESTERDAY CONV 5.5% – UP 19 CONV 6.0% – UP 16 GOVT 5.5% – UP 6 GOVT 6.0% – UP 0 10 YR NOTE – DOWN 6 TO 4.56 DOW JONES – UP 538 |
| SO FAR TODAY CONV 5.5% – UP 3 CONV 6.0% – UP 6 GOVT 5.5% – UP 3 GOVT 6.0% – UP 3 10 YR NOTE – UP 1 TO 4.57 DOW JONES – UP 114 |
GREEN is GOOD for Rates – RED is BAD for Rates
Product & Guideline Highlights
CHECK FOR WAIVERS
Effective January 11th DO made some changes to LTV’s that will accept PIW’s as well as value acceptance plus property data reports.
The PIW went from max LTV of 80% to 90% LTV.
The Value Acceptance plus property data report now allows all the way up to 97% LTV.
This means using these lesser appraisal value requirements could speed up your turn times and cause less drama for your buyers and sellers as well as reduce the cost to close a loan.
As a reminder here are the different options outside of an appraisal.
REDUCED APPRAISAL VALUATION OPTIONS
- Desktop Review – No property Inspection and value determined by appraiser.
- (Fannie) Value Acceptance + Data Report – Inspection required by 3rd party and value is accepted on AUS.
- (Freddie) ACE + PDR (Property Data Report – Inspection required by 3rd party and value is accepted on AUS.
- Hybrid Appraisal – Allowed if you received reduced appraisal back and then AUS changes after the fact a hybrid would be allowed.
- Fannie Value Acceptance and Freddie ACE – It is the same as the old PIW. No changes when no data report or PDR required on AUS.
THE #1 ITEM TO KNOW
- In order to use the reduced products listed on the AUS the file must be underwritten first and the underwriter must notate which product is allowed and then you order the reduced product.
- The reduced product will show up on initial AUS with the exception of the hybrid which is a case by case situation.
I have attached a quick reference guide for your review.
Click For Quick Reference Guide
Jackism of the Day
GET UNCOMFORTABLE
If there is one thing in life we can all be assured of. It is that nothing worth doing comes easy.
Most people have an aversion to conflict or disputes or they just walk the other way when they see difficulty coming their way.
There is a certain life wisdom in living life this way for sure. Living a good life with low stress and minimal interruption combined with low conflict is something that I think we can all appreciate from time to time.
I am not talking about that though. What I am talking about is the willingness and desire to do something great for yourself. Something that makes an impact in your life which in turn makes an impact in others lives.
I think we all have a desire to make the lives of others better because they are around us. We do not wake up in the morning and ask ourselves how can we ruin someone’s day today or how can I be in a bad mood and make everyone around me miserable.
Some of us do that for sure, although I do not believe anyone sets out to do that. Life just happens and the end result is not what we hope to be in our lives.
In order to do something different, in order to do something special and extraordinary then one thing must happen.
The only way to make progress in any area of your life is to get out of your comfort zone. It is that simple. You can continue to be the status quo in your life by doing what you are comfortable in doing.
It is not until you get out of your comfort zone will you ever see progress in these areas of your life that you want to see growth.
What is an area right now that comes to your mind that you want to grow in? That you want to excel in? That you want to shine brighter than others around you to show that something is important to you? It has value and you are willing to do what it takes to create that value for yourself and for others.
Now ask yourself what is it that you know you need to do in order to make that happen, that you have not been willing to pull the trigger on as of yet.
Here is the key. Now go do it! Or at least start the process of doing it.
How do you climb the stairs? One step at a time. I guarantee you will never reach the top of a stairwell unless you take the first step.
Never look at the daunting task of making it to the top. Just look at the task of taking the next step to prepare you to take the next one then the next one then the next one.
It is one of my favorite things to do. To find something I am not doing now and begin to move forward one step at a time. It is amazing what you can accomplish with daily consistency in moving yourself towards what you are trying to accomplish.
Many times the journey is a lot more fun than the goal you are trying to reach. Start today to make tomorrow a greater day.
