Rates
Well we started off this week with rates heading for the better after a week of improvements, but then the “Words” started to play with the bonds.
These words were from the Federal Reserve, and once again, we are getting conflicting information from the Fed. This time their meeting notes were released and it indicated that the Fed is more likely to reduce their QE3 sooner rather than later.
If you look back last week, it was assumed QE3 would stop sometime in March to June. Now we are talking about sometime before March.
I do want to preference this, when they do start the QE3 tapering, rates are expected to shoot up 1 to 2 points. Remember this phrase “6% interest rates are not bad rates”
Although we did have a bunch of economic news, the only news that matter this week was the Federal Reserve and Unemployment numbers.
Unemployment numbers came in pretty good with the estimate of 334,000 but came in at 323,000.
This information caused bonds to sell of Tuesday and Wednesday in dramatic fashion. We had a slight recovery on Thursday and a little more today.
So at this time, it is really not worth the gamble, lock them.
Rates and the media
I had a client come to me and state that according to USA Today, rates were in the 4.22%, and she was concern when I locked her rate at 4.50%.
Couple of things to keep in mind:
By the time the media reports something, it is more than likely a week old, rates change, sometimes dramatically, on a day by day and even minute by minute basis.
Also FICO scores play a role, typically when media advertise rates that is with a 800+ FICO score, and you have to walk on water.
Text Messaging
Do you do business over Text Messages, seems like today a majority of us text. But doing business is not recommended.
How do you print that text message for your records?
Does your company have a Text Message policy…???
Something to think about, because the CFPB is looking for Social Media and Text Messaging company policies.
Personal items in a purchase and sales agreement
It is highly recommended that when you write up a PSA, and there are personal items included, such as a hot tub, swimming pool, playground equipment that those items are stated as “no value”
Underwriters are being pushed harder and harder to watch out for “enticements” from the sellers to the borrowers. And personal items of value can be seen as enticements.
Please consult with your brokers, but from what I hear, most brokers recommend personal items be disposed of outside of closing.
But be careful not to double contract, jail is bad.
New GFE and TIL
Well the CFPB dropped the bomb again on us on Wednesday. But atleast they are giving us some time to think about it.
The new Good Faith estimate and Truth in Lending forms will be implemented August 1st , 2015. Yep, over a year from now.
The forms are, in my opinion quite a bit better and more understandable.
But here is the kicker!!!!!
From the reading right now, once a person signed all of their closing documents, there will be a 3 day “cooling off” period, or right of rescission time. This means that the borrowers will have 3 business days to review the documents and cancel the transaction.
This is very similar to refinancing loans, where you have 3 business days before it can fund.
So no more same day funding’s!
Idaho recognizes Saturday as a business day.
But no matter what, this will need to be accounted for when figuring out closing dates.
Lead Generator for today
If you are not sending out birthday cards to your clients and Christmas cards, you are missing out on a HUGE marketing tool.
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Real Estate CE Class:
Due to demand, title has asked me to do 1 more class on Lending before the end of the year, if you haven’t taken this class it would be well worth it:
https://www.titleonecorp.com/productsandservices/continuinged_registration.aspx?class=76