Mortgage Market Volitility This Week- As I read the news…

Mortgage Market Volitility This Week- As I read the news…

scoop-it-baby-227-x-320.jpgAs the mortgage market continues it’s volatility I saw in not one but two papers this morning and then on the “business news” radio, “30 year fixed rates holding at 5.875%”.  A strong surge in the stock market on Friday due in part to Google’s earnings, oil prices and the 10 year Bond heading to a 4 week high, the 30 year fixed rate easily pushing 6% over the past three days.

What does this mean? A good guess is those borrowers who didn’t lock in at 5% while waiting for 4.5% probably missed the boat. When we did have a drop a couple of weeks ago from 6% to 5.5% did our borrowers choose to lock their interest rates in then? Are you ready to lock your loan or put your purchase client with someone who knows how to position their clients for that time? It looks like most of the market waited for rates to continue lower based on the backlog of stale loans with lenders.  What will our clients choose now that rates have climbed over the 6% mark?

 

How do you get your clientele off the fence? A magic spray potion would be nice, but try a little history of what has been going on in the market.

 

Show them the trends since the first of the year, mostly up, pull back and up again.  (Not much different than gas prices) Show them the programs that have “vanished” that would have made their transaction easier, almost all investors have discontinued “income waiver” for DO/DU/LP findings and they will now need to go “actual full doc” to get that “lower” rate if they don’t move on something soon. If they need out of that option arm, or want to move from the adjustable to a 30 year fixed, 6% or al little over that is pretty low when you look at the last 30-40 years of rates.

 

This is a great place to start with your clients. Start the discussion- shrinking loan liquidity and restriction in loan guidelines make now better to buy than later.

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