Rates
Well when all was said and done this week, rates ended up pretty much where they began, still sitting in the low to mid 4’s and government sitting in the high 3’s.
So what happened this week, well the big jump up in rates happened on Tuesday, when inflation raised its ugly head. Bonds hate inflation and it is the one item that will make rates jump the fastest.
For some of you, you will remember back in the 80’s when interest rates were in the 15-20% range and inflation was HIGH, thanks Jimmy Carter!
Well bond traders are really worried about inflation and any sign will cause bonds to sell off and mortgage rates to go up.
But Wednesday came along and the Federal Reserve indicated they were not really too worried about inflation, so rates improved on Wednesday.
And then for the last 2 days, rates have been trading in a narrow range, not doing much.
So we are in a neutral to locking stance right now, really nothing to cause rates to dip down to their 2014 lows we had back on May 28th. But also nothing really to cause rates to jump higher.
Stuff to watch out for:
-Ukraine and the war mongering going on there.
-Iraq and the war mongering going on there.
New Deposit rules.
Back in January Fannie Mae came out and said that all deposits into a borrowers account over 25% of income deposits had to be documented. Which means if a borrower makes $1500 a paycheck, and they had a deposit of $500, we had to know where it came from and document it.
This was REALLY a PIA!!! And caused lots of delay in lending.
Well Fannie updated their policy, and now it is 50% of income, which is quite a bit better, but we are still needing to source and season those deposits.
So for clients, they need to be aware that any deposits could be required to know where they got the money and will need documentation.
Why you ask??
Purchasing a home and refinancing a home is the #1 way of laundering drug money, so we have to be sure that all source of funds are coming from legitimate sources.
And to put my conspiracy theory hat on, I believe the government isn’t liking that 2 states are now legalizing Pot and that those proceeds are being used to purchase home loans, backed by the Federal Government. Just a thought!
Down Payment Assistance & IMLS
Idaho MLS has a pretty cool new feature which allows Realtors and Buyers to see if a home is eligible for down payment assistance, cool article here:
http://www.imlsmembers.com/Newsletters/114_Intermountain_MLS_Newsletter_for_June_11_2014
MLS & Zillow
And speaking of MLS, attached here is a VERY good video with regards to MLS and Zillow.
http://thenationalrealestatepost.com/will-zillow-start-taking-listings-and-selling-homes/
They bring up some GREAT points, and if change does not occur with MLS across the US, they will most likely die a painful and horrible death.
And this further to questions, if Zillow can do this, what prevents them from doing more, i.e. Flat fee listing.
It is super important that Realtors right now, prove why they are important.