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Slight Increase In Today's Mortgage Rates 11-30-2017

By James Brooks

The bond market is down 6/32 (2.42%), which should increase Raleigh area mortgage rates by .125 of a discount point.

Yesterday afternoon?s release of the Fed Beige Book didn?t reveal many surprises. It indicated modest to moderate economic growth throughout the Fed?s 12 regions. What did draw some attention were notes of price pressures rising since the previous update. Inflation has been subdued with the Fed repeatedly predicting it will eventually get to its preferred threshold of 2.0% annually. Rising inflation makes long-term securities such as mortgage-related bonds less attractive to investors and causes mortgage rates to rise instead of falling. Yesterday?s news didn?t have much of an influence on mortgage rates, but it does put us on alert for the next update.

There were two economic reports posted this morning, both at 8:30 AM ET. The Commerce Department gave us October's Personal Income and Outlays data that showed a 0.4% rise in income...

Low Interest Rates Have a High Impact on Your Purchasing Power

According to Freddie Mac’s latest Primary Mortgage Market Survey, interest rates for a 30-year fixed rate mortgage are currently at 3.92%, which is still near record lows in comparison to recent history!

The interest rate you secure when buying a home not only greatly impacts your monthly housing costs, but also impacts your purchasing power.

Purchasing power, simply put, is the amount of home you can afford to buy for the budget you have available to spend. As rates increase, the price of the house you can afford will decrease if you plan to stay within a certain monthly housing budget.

The chart below shows what impact rising interest rates would have if you planned to purchase a home within the national median price range, and planned to keep your principal and...

Some Improvement For Mortgage Rates 11-28-2017

By James Brooks

The bond market is up 5/32 (2.31%), which should improve Raleigh area mortgage rates by approximately .125 of a discount point.

Yesterday?s 5-year Treasury Note auction was uneventful with the indicators pointing towards and average or slightly better demand for the securities. The bond market had little reaction to the news when results were posted at 1:00 PM ET yesterday. However, it does allow us to be a little optimistic about today?s 7-year Note sale. If it is met with a strong investor demand, we could see bond prices improve slightly this afternoon. Results will again be posted at 1:00 PM ET, so any reaction will come during early afternoon trading.

Today?s sole piece of economic data was November's Consumer Confidence Index (CCI) at 10:00 AM ET. The Conference Board announced a reading of 129.5 that exceeded forecasts and October?s revised 126.2. It was the highest reading since November 2000, meaning consumer confidence in their own financial...

The Cost of NOT Owning Your Home

The Cost of NOT Owning Your Home | Simplifying The Market

Owning a home has great financial benefits, yet many continue to rent! Today, let’s look at the financial reasons why owning a home of your own has been a part of the American Dream for as long as America has existed.

Zillow recently reported that:

“In reality, buying or renting a home is an intensely personal decision, with emotional and even financial considerations that go beyond whether to invest in this one (admittedly large) asset. Looking strictly at housing market numbers, there is a concrete point at which buying a home makes more financial sense than renting it.”

What proof exists that owning is financially better than renting?

1. We recently...

Mortgage Rate News 11-27-2017

By James Brooks

The bond market is unchanged from Friday?s early close (2.34%), which should keep Raleigh area mortgage rates at Friday?s levels.

The week started with a relatively minor economic release late this morning. The Commerce Department gave us October's New Home Sales data at 10:00 AM ET, announcing a 6.2% rise in sales of newly constructed homes. This was much stronger than expected and pushed sales to their highest level since October 2007. The unexpected rise indicates the new home portion of the housing sector was stronger than many had thought. That makes the data bad news for bonds and mortgage rates.

In addition to this week's five more economic reports, there are two relatively important Treasury auctions that may also influence bond trading enough to affect mortgage rates. There will be an auction of 5-year Treasury Notes today and 7-year Notes tomorrow. Neither of these sales will directly impact mortgage pricing, but they can influence general bond...

Black Friday Mortgage Rate News 11-24-2017

By James Brooks

The bond market is down 2/32 (2.34%), which should keep Raleigh area mortgage rates unchanged.

Wednesday?s afternoon release of the minutes from the most recent FOMC meeting gave us some bond-favorable information. They showed that Fed members are growing more concerned about inflation running well below their preferred level. There was also some talk of the fact the Fed may have raised key rates prematurely because inflation has not strengthened enough. What was in the minutes doesn?t derail a December rate hike though. Still, they gave us favorable results and the bond market strengthened after their 2:00 PM ET release, causing some lenders to improve rates before closing.

There is nothing of relevance being posted today. In fact, it should be a pretty calm day for mortgage rates because many bond traders are home for the holiday weekend. The stock markets will close at 1:00 PM ET today while the bond market will close at 2:00 PM as part of the Thanksgiving holiday....

Bubble Alert! Is it Getting Too Easy to Get a Mortgage?

Bubble Alert! Is it Getting Too Easy to Get a Mortgage? | Simplifying The Market

There is little doubt that it is easier to get a home mortgage today than it was last year. The Mortgage Credit Availability Index (MCAI), published by the Mortgage Bankers Association, shows that mortgage credit has become more available in each of the last several years. In fact, in just the last year:

  • More buyers are putting less than 20% down to purchase a home
  • The average credit score on closed mortgages is lower
  • More low-down-payment programs have been introduced

This has some people worrying that we are returning to the lax lending standards which led to the boom and bust that real estate experienced ten years ago. Let’s alleviate some of that concern.

The graph below shows the...

Mortgage Rates Improve 11-22-2017

By James Brooks

The bond market is up 6/32 (2.33%), which should improve Raleigh area mortgage pricing by approximately .125 of a discount point.

October's Durable Goods Orders report was released at 8:30 AM ET this morning. The Commerce Department announced a 1.2% decline in new orders for big-ticket products. This was weaker than the 0.4% increase that was forecasted. Even a secondary reading that excludes more volatile and costly airplanes and related products came in slightly lighter than anticipated. This data is known to be volatile from month to month, so the large variance isn?t as important as it would be if it came in other reports. Still, it points towards a softening manufacturing sector, making the data good news for bonds and mortgage rates.

Last week's unemployment figures were also released early this morning. They showed that 239,000 new claims for unemployment benefits were filed last week, down from the previous week's revised total of 252,000. The decline in initial filings...

Access is an Important Factor in Getting Your House SOLD!

Access is an Important Factor in Getting Your House SOLD! | Simplifying The Market

So, you’ve decided to sell your house. You’ve hired a real estate professional to help you with the entire process, and they have asked you what level of access you want to provide to potential buyers.

There are four elements to a quality listing. At the top of the list is Access, followed by Condition, Financing, and Price. There are many levels of access that you can provide to your agent so that he or she can show your home.

Here are five levels of access that you can give to buyers, along with a brief description:

  1. Lockbox on the Door – this allows buyers the ability to see the home as soon as they are aware of the listing, or at their convenience.
  2. Providing a Key to the Home –...