Rates

Well we almost did it, and Wednesday we actually did do it.  FHA and Conventional Rates dipped to 3.50% on Wednesday for about 4 hours and then the US government had to ruin it with good economic news!

So here what happened:

Over last weekend Greece approved their plan to get the EU to bail them out, in the tune of $119B.  And it almost caused Greece to burn to the ground with protesters. 

But on Monday, the EU said, well let's continue to look at it and delayed the vote for EU approval until 20th.  Which caused Greece to explode and complain that the EU is continually trying to move the bar.

Now remember if the EU doesn't give Greece the money, on March 20th, Greece has about $19B worth of bonds coming due and can't pay for it, so they would default.

This Greece issue is what has kept rates low and almost had us into the 3.50% range, and that is for a 30 year loan!!!

So Monday will be interesting, if the EU doesn't do anything, then they have thrown their hands up and will probably let Greece default, thus causing Recession 2.0, at least in Europe.

But now onto the US news:

All news this week has shown that the US economy is really chugging along and a pretty OK pace, not good, and not great, but OK.

-Business Inventories up .4%, GOOD!  More inventory means they are ordering more, thus creating jobs for manufacturing.

-NY Empire State manufacturing was at a 19.5, anything over ZERO is good, up from 13.5 in previous month. 

-January industrial production flat, but keep components were up quite nicely.

-National Home Builders index, increased from a 25 to a 29, once again ZERO is bad, and a few months ago we were at zero!

-Unemployment numbers for 1st ime filing fell again by 13K to 348K, THE LOWEST LEVEL IN 4 YEARS!!! 

-Housing starts up 1.5%

-January Producer price Index, i.e. inflation, was only up 0.1% inline with forecasts

So what the heck does this all mean, well if Greece get's it bailout on Monday, there really will be nothing to hold the Stock market back, and investors will start to flee bonds and buy stocks.  Thus causing interest rates to start to climb.

Now we are not expecting a huge increase, just slow and gradual.  The 3.75% rates we have right now will be pretty good for about 30 days, and then will start ticking up to the 3.875 to 4.00.  Economy really isn't that good right now to see rates tick into the mid 4's, but I suspect we will see the low 4's by mid summer.

Not a huge increase, but for those people who were predicting and trying to catch the bottom, you MISSED it.  I feel home prices, from what I see in MLS, bottom around Summer, and interest rates bottomed this week

But Greece could go to Heck, and rates will contineu to decline....and so the hands of the clock continue to turn...

FHA tax increase

Well FHA, eventhough they are getting billions of dollars from lawsuits and bailouts, has decided to increase the monthly Mortgage Insurance AGAIN!  Initial read is the MI is going to go from 1.15% to 1.25%.  Exact date has not been established, but I would suspect sooner than later.

Now this will add on $8.34 per month to a mortgage payment for every $100,000 borrowerd on FHA loans.

But there is a solution, don't do FHA!  Idaho Housing announced a GREAT new program for people with over 660 FICO scores, it is called Preferred Program, which allow people to purchase a home, with only 3% down (FHA is 3.5%) and NO MI, that is correct no MI, not Monthly MI, not Lender paid MI, ZIP.

DOWNLOAD the flyer to the right for me details!!!!

Fannie Mae Forbearance Program

Fannie Mae last month released a program that allow for up to 6 months of a persons mortgage payment to be forbeared if they lost their job at no fault of their own, i.e. laid off.  It is a GREAT program, and if they don't have a job in 6 months, FNMA allows an additional 6 months!

Call me for more details.

Lead Generator

Here is my lead generator for the week!

Get you list of past clients that have closed a home with you:

Good Afternoon, this is (insert you name here), I just wanted to call you and see how things are going, and to remind you that you should go online an pull you Annual Credit Report.  You can get your Federally Mandated Credit report at:  www.annualcreditreport.com. 

And the reason you should pull your credit report is not to see if there is anything you did, but to make sure your identity hasn't been taken over.

How is the house?  Did you file for your Homeowner's Exemption?  Is there anyone else you may know of that I can help with finding/selling a house or anying struggling to make their payments?

Simple phone call, and it works!!!