Hold the phone on rates! Well as I said in the past, it is going to take a major happening in the world to get rates back to recent levels, and that has happened this week on 2 fronts.
- 1st, we have war or atleast sabre rattling happening. With Trump pulling out of the N. Korea summit and then saying that our military was ready, bond traders jumped into the safety of bonds and parked their money. This nicely improved mortgage rates this week. Although late today, we do have Trump saying the talks are now back on. With the long weekend, traders are leaving their money in bonds, just in case N. Korea or Trump does something stupid over the weekend.
- 2nd, Federal reserve notes came out from their last meeting and 2 items of significance was read. 1st, the Fed Governors are willing to let inflation go over the 2% mark. In past, the Fed was extremely worried if inflation went over 2%, and had indicated that they would do what ever in order to keep inflation at or below 2%.
Now they are saying 2% is ok, and maybe a little more??
This resulted in the Fed indicating that they are down from 4 rate hikes in 2018 to somewhere around 2, there is right now on the betting line a 96% chance of a .25 in June, which means, if history holds true, the next one would not be until December, which would also be a .25 hike. In reading the notes from the Fed, it really looks like they are indicating that instead of the Fed slowing the economy down, Trump is doing a good job on his own with all of these Tariffs and Trade negotiations.
Based on this latest information, we might just see 6% later in the year or maybe off the table in 2018. But who knows.
New programs being released
As refinancing is drying up for mortgage lenders, and home buyers seeming to be less and less, lenders are bringing out more creative financing to fit more and more buyers into different loan programs.
Recent new programs, which have been released and we have added:
- -More manufactured home loans, with lenders willing to do double and SINGLE wide trailers now!
- -Renovation/Remodeling loans for Conventional, FHA, and VA loans now.
- -USDA or Rural Development rehabilitation loans for purchasing homes.
- -One time close loans, for building new homes or remodeling existing homes, where as the builder or remodeler does not have their own line of credit. And this program works with people buying a manufactured home from the factory and placing it on a lot.
- -Bank statement programs, where as we can take 12 months of bank statements and utilize deposits as income, for self employed people only.
- -FHA & VA down to 500 FICO scores.
Really in truly, there is enough new programs available for people, that almost anyone could get a loan now a days. If you ever have a borrower declined from another lender, let us take a looks, odds are we can save the file!
Couple of articles on Zillow this week that peek my interest.
- 1-Zillow being sued by New York due to their Preferred Agent. Now not being an agent, I only kind of follow this, but it goes back to which agent is the original listor of the house. And from the articles I have read, looks like NY has some footing to stand on: https://www.housingwire.com/articles/43440-lenders-goldman-sachs-zillow-entering-fix-and-flip-market-is-a-good-thing?eid=311700059&bid=2114211
- 2-Zillow getting into the Fix and Flip market and the FSBO market, this one goes along with past articles that Zillow is now selling homes in 4-6 markets. It is only a matter of time before a seller will be able to list their home on Zillow, and Zillow will FedEx them a box, and in that box is a listing sign, flyers, marketing materials, and guidance on how to sell their home, all for the low, low price of $99.95. Mark my words, it is coming: https://www.forbes.com/sites/marcgerstein/2018/05/14/is-zillow-a-ticking-time-bomb/#7d41544f17fa
I received a lot of positive feed back with regards to flood zone information I blogged about last week, so much so, I am going to cut and past it again here for those agents that did not get to the blog last week.
FEMA updated flood data for both Ada & Canyon county, and there are more areas that now require flood insurance. I have linked the data map below.
I was recently asked by a Realtor about the difference between a Flood Plain and a Flood way. So I have found a good YouTube Video from the Army Corp of Engineers that explains it.
The reason the Realtor asked, is some clients purchased a home, and it was not disclosed that they are on a Flood Way. The clients wanted to build a shop on their property, but the City told them they could not, AND the existing structures on the property, that were in the Flood Way, and to be removed.
So, do you have to have flood insurance if you are on a flood way? Probably, you have to contact your insurance agent and review a Flood Certificate. Now if you are in a flood zone, you also need to see if you are in a Flood Way also, because if you are in a Flood Way, you cannot build on that area.
So be aware of this for your clients. And a couple words of wisdom:
If you get a loan, we pull flood certificates, on ALL homes, but the flood cert only tells me if you are in a flood zone and that you may or may not have to have flood insurance.
If the lender says you have to have flood insurance, further research would need to be done to see if the home is in a Flood Way.
But what happens if the borrower’s are paying cash for the home. Well call up your friendly neighborhood Mortgage Broker (ME!) and for $15.00 we can pull a Flood Certificate.
Valuable links that will save you from an E & O Claim: