Have a blessed Easter weekend;
Mortgage Rates: Time is Now
– DON’T MISS OUT–
Markets – anticipating improving Co-Vid numbers – is showing needed calming, as fears of the great turbulence, quiets. Yet, let us remain aware and informed, regardingour real estate economy and those bits of information that influence it.
While we watch from home, consider the rapidly accumulating world debt. Absolutely needed to keep the gears of our markets well oiled, the question is: How will it all be digested?
HAPPENINGS:
Forbearance and Caution: The issue is under the direct influence of the Federal Housing Finance Agency – FHFA. They oversee both Fannie and Freddie, and then some. Please note: As, or if a mortgages goes into forbearance, the Servicer – the company you write your check to – still must make the payment – even if you don’t. The Good News: They have the needed capital on hand, for standard market swings.Butthey can be overwhelmed by too many, to fast.
In response, Mr Cordroy of FHFA, offers the following, “we should be able to do just fine, with expected forbearance numbers’. However, “If there is a problem, we will simply take over the mortgages”. This suggests it is possible FHFA may take over private companies. For me, this sound like a warning, hoping it’s little more than a mere stop gap suggestion. Keep watching.
SBA for Small Business: Two helpful programs.
1) A $10 K grant that comes directly from SBA – under the SBA -EIDL program.
2) PPP funds. Current estimates: 20 % of the PPP funds have been applied for. The Good news:80% remains available. We will keep watch to see how well the program works, and how fast it can be implementation. Speed is important and critical for many.
If you are one of these small businesses in need, please call. Why? Because not all banking institutions are participating and many in the brokerage business, shy away due to the lack of compensation. That said, we are here and ready to help – in any way we can. Let’s talk.
Wells Fargo has all but run out of money to help their clients. Give a call, we have other lending partners willing to step in.
Helpful information: For businesses and sole-proprietors – with payroll – you can receive about 2 1/2 months of salary, as a loan. Good News: There are provisions whereby such a loan, can become forgiven. Let’s talk and carefully review the small details.
Be sure to call. Let’s make sure you know how best to move forward.
MARKET SEGMENTS:
US Federal Reserve: The waiting is done, actions are happening:
Actions:
– Fed Funds rate are now effectively zero (target rate now 0.25 %)- Adding / pumping liquidity into the market
– Buying both Treasuries and Mortgages, doing so in ways to best stabilize andmaintain a healthy balance within the financial system.
Goal:Provide greater confidence in the banking system – their ability to act as needed and to act now, not later. This injection of liquidity – directly or by lowering interest rates – should keep the wheels of our economy turning and people confident.
Federal Government actions:
Good News: Removing liquidity restrictions put in place by Dodd-Frank. In short, banking money – frozen by this law – is now available. Amount: $1.5 Trillion.
Mortgages:
Underwriting– Priorities have shifted. Non-QM loan products are mostly gone. Funding sources utilized Wall Street, has all be vaporized. Wells and Chase may both be pulling out of Jumbo loans, due to uncertainties. Many of our mainstream
sources are gone.
However, We DO HAVEsources remaining. Please know as we have lenders ready to lend. Keep your eyes on this blog for updates. Or Call Us. Details matter.
Staffing, appraisals, signing.. Thankfully, technology is allowing most staff to work from home. At the same time, some appraisal companies are closed, locally.
Good News: ManyStates allow are allowing electronic signing of papers. Washington DC is looking to make it legal Nationwide.
We are getting it done!
Pricing:Hats off to the Federal Reserve. After initially dumping too much money in the market, they are now active daily. The Good News:10- year treasury market has not seen a 1/4 % or higher dailyswing in rates since March 27. Our Mortgage Backed Securities market is also benefit. Earlier, we talked about swings of 100 to 300 basis points. Today, swing range up to 50 bps have become the working norm, since April 1.
Stock Market:
After bottoming out late March, the market has been trending upward. For traders, numbers are above the 25-day moving average. Stay cautious for 30 days or more.
STRATEGIES YOU CAN USE:
Potential Strategies:
Refinance Strategies:
A) Debt consolidation reduces overall payments, puts cash in the bank, and builds a safety net. Home improvements can also increase home value and salability.
B) No Cash out / Lower rate loan. Get into the system now. Then let underwriting, appraisal, all.. do their thing, while you watch / wait / execute when interest rates hit a low point.Good News: Appraisals are good for 4 months, with a simple update. So too, all the paperwork with a quick update. Start today.
Purchases:
A) Fear creates opportunity, storms can create deals. Those ready are in the driver’s seat. I am a long-term Bull with California real estate market. The fundamentals remain the same – lack of Supply + one of the best places in the World to live, and home to high tech. These will continue to drive demand.
B) With rates this low, consider a low down payments options. Keeps you in control of your cash and remember, cash is king during an economic slow down. Even better, when the market kicks back in gear and rates double from here, you will be smile at your low rate, while enjoying your cash for other investments.
CAVEAT: UNAVOIDABLE DELAYS
Being an SBA lender, as well as Commercial and Residential, our phone is ringing. I will return any missed call as quickly as I can. Sadly I have no crystal ball, nor does anyone else. Instead, ours is to make some sense of the market, the day you call. But predicting tomorrow is impossible. So finding safe and secure lending is critical and what we do best.
Key to success: Being diligent in gathering up all your information. This has become a time-sensitive market and your extra effort will help assure the success, we both desire. Like you, we are doing whatever is needed, to get it done. Being prepared, we can be the team that wins.
We Believe in You and You Matter to Us
Thank you for trusting me with yourself, your friends and family. Referrals are appreciated.
We are working hard in these stressful time, and are doing our best to keep things moving smoothly. Sadly, I am only human, with human and life limitation. But my motivation for you to succeed, has not diminished. :-)
Call me. Your success is my priority.