Mortgage News

How can you harness that valuable resource of home equity without jeopardizing your low mortgage rate? The United States is currently experiencing a record level of home equity, surpassing $27.8 trillion.

Traditionally, accessing your home equity while maintaining a low mortgage rate would involve providing comprehensive documentation, such as paycheck stubs, W2 forms, or tax returns. However, there are alternative options available that leverage the equity in your property. These are referred to as low doc or no doc loans, also known as SIVA (Stated Income Verified Assets) loans.

With low doc or no doc loans, the emphasis is less on extensive documentation and more on the value of your property’s equity. These loans enable borrowers to state their income without extensive verification, while the focus shifts towards verifying the assets they possess.

By opting for a low doc or no doc loan, you can tap into your home equity effectively, allowing you to access the funds you need without disturbing your low mortgage rate. These loans provide flexibility and convenience for borrowers who may have unconventional income documentation or prefer a streamlined application process.

It’s important to carefully consider your financial situation and consult with a qualified mortgage professional to determine the best approach for leveraging your home equity while safeguarding your low mortgage rate.

Have a great rest of your week.

The Global PMI (Purchasing Managers Index) report came out this morning showing evidence of a global slowdown.

Below we are specifically looking at the orange line showing14 months of contraction. We are also seeing a slowdown in the US, as evidenced by the Leading Economic Indicators repot

Rates are still stubborn as always as we look towards July and August for relief. Have a great weekend.

Existing Home Sales showed sales rose 0.2% in may at a 4.3M unit annualized pace. This is stronger than the estimated 1.0% decline.

Inventory levels increased slightly to 1.08M but are still very low. There is a 3 Months’ supply of homes. to put this into perspective, 4.6 months is considered normal.

I thought this was interesting given I am currently on the internet and never actually thought about the dominance of the English language.

Have a great rest of your week.

It’s possible that you find yourself living in a home that simply doesn’t suit you anymore, either because you have outgrown it or were compelled to purchase it within the past two years.

While it’s true that the interest rates have increased significantly compared to two years ago, it’s worth noting that once the rates reach the 5% range, the monthly payment only rises by approximately 20% compared to the existing total payment.

Have a great rest of your week.

Housing Starts in May rose by 21.7% to 1.63M Units, Which is much stronger than estimates.

Single Family starts rose 18.5% last month to 997k units. The key to future activity is the Housing Permits, which were up 5.2% last month at 1.49M units.

Completions also increased by 9.5% last month of which 3.9% were single family homes. We need inventory in a very bad way. This is a good start but not out of the woods yet.

On Friday, the Teamsters union with over 340,000 UPS workers, voted to overwhelmingly strike.

Have a great rest of this short week.

The Consumer Sentiment shows greater optimism as inflation eased and policymakers resolved the debt ceiling crisis. This is a 28% increase from the historic low of 51.5% in July 2022.

Anecdotally I have been seeing multiple offers on almost all of my clients purchases. This is backed up by Redfin recent report showing 33% of transactions have been sold over asking price.

If you are not fully underwritten by your lender, ask why and if you don’t get a good answer, let me know. The key to an accepted offer is a fully underwritten file with no conditions except the appraisal.

Have a fantastic weekend. 100 degrees in Palm Springs CA tomorrow but its a dry heat…

Below is the graph from http://www.federalreserve.gov showing Inflation projections. Yesterdays positive inflation numbers hit the bond market hard in a very odd way. We expected better rates but got the exact opposite. Today we are seeing recovery from those lows.

To put life into perspective. see below Picture from Voyager turning around to take a Pic of the Earth. Location just past Saturn.

Inflation has decreased, yet the rates appear to be persistently resistant to change, like the adhesive nature of a sticky substance.

To illustrate this, imagine tugging on an elastic band, only for it to inevitably recoil and snap back towards you. This analogy may offer a glimpse of what could potentially occur during the upcoming summer months.

Back on the road this morning for the final leg of my trip.

Half way through my road trip and the pillows are just not the same.

CPI – Consumer Price Index year over year as expected and down significantly from last year. This is favorable for the bond markets and more importantly the Mortgage rates.

Back on the road, have a great rest of the day and week.

The CPI Consumer Price Index inflation report for May will be released.

Here are the technical bits. last year 0.9%, this year (Y/Y) should come in at 0.2% showing inflation dropping from 4.9% to 4.2%. This will be a significant drop.

Wednesday the Producer Price Index report will also be released. This is the wholesale inflation number. We anticipate an already low 2.3% to go down to 1.5%.

Feds are kicking off a 2-day meeting with their rate hike decision on Wednesday 2:00pm ET. They will have the benefit of seeing both the CPI and PPI numbers before deciding on a pause or rate hike.

Driving from University of Washington (daughter) to Palm Springs this week. Love road trips but maybe not necessarily in a 20 foot U-Haul.