If you can't think of a word or phrase, say, "I forgot the English word for it." That way people will think you're bilingual instead of an idiot. It is not hard to remember the phrase, “Rates are going higher.” While independent mortgage banks continue to compete with the intermediate ARM offerings from depositories in the 3 percent range, and originators shift their sales techniques, on a larger scale the Federal Reserve acted yesterday confirming its desire to slow inflation down by raising the target overnight Fed Funds rate by 75 basis points (.75 percent). (For a primer, MCT had a post, “How Does the Federal Reserve Affect Mortgage Rates”?) Forget worrying about lack of growth, or its market guidance credibility (Fed officials were talking about 50 basis points for weeks), the 75 “bps” helps the Fed’s inflation-fighting credibility. And remember that the Fed hasn’t even started the selling pr
Recently in Reno I overheard someone predict, “Forget Wikipedia. How about someone create ‘Liquorpedia’ with an encyclopedia of alcohol and drink recipes?” Remember when many “experts” predicted that a) Amazon was going to enter the lending biz and trample everyone, and b) Costco, after announcing it was offering mortgages to members, was going to drive any remaining lenders out of business? Neither has happened, and in fact, Costco has ended its mortgage “perk” for members. (There’s even some Costco humor in the joke section.) Meanwhile, Zillow, which has ended its iBuying business, is watching its stock hit multi-year lows, mimicking nearly every lender’s stock price. And why not? We’re seeing the highest 30-year mortgage rates since 2009, firmly in the 5s, and little inventory for sale. Rate and term refis have nearly vanished, and last week’s move by our Fed has short term rates predictably moving h
My friend David had his id stolen and now he’s just Dav. Having anything stolen is not a laughing matter, and since we’re in the money business, lenders and vendors are often the target of cyber-attacks. If you want the FBI’s take on them, the Texas MBA is hosting the “Anatomy of Cyber Attacks” webinar next Wednesday, April 13th. (More upcoming events below.) Some MLOs think that interest rates have stolen their livelihoods, but really, did you think 30-year mortgage rates were going to stay in the 2s forever? Or overnight fed funds near 0 percent? As of Friday’s close, the market has priced in a 70 percent likelihood of a 50-basis point hike versus 30 percent for a 25-basis point hike. The question remains whether the Fed will be able to achieve its desired soft landing whereby inflation eases back towards their target without impeding economic growth. Rising prices continue to put pressure on all areas of the supply chain which will likely me
While brokers have taken note of UWM suing America’s MoneyLine for sending loans to Rocket and Fairway (remember UWM’s policy plainly stated last March), this week I head to Florida, which retirees humorously refer to as “God’s waiting room.” The state has its share of expected hot markets for 2022 per Zillow, as does the rest of the Sunbelt. Apparently, people in the northern climes are weary of the yearly weather cycle, and, as usual, expect to establish residences to the south. Throughout our lives we go through many cycles. And who says we’re not in a cyclical business? Remember in the not-too-distant-past when lenders were pricing rates to “shut off the volume spigot” due to low rates? Last week U.S. Treasury prices fell with the 10-year yield briefly topping 1.93 percent, jumping from about 1.5 percent at the start of the year, and the 2-year Treasury is up 58 basis points since 1/1, as the Federal Reserve has signaled a mor