Posts

Rates Keep Falling & Will Fall More; Timing The Market

Rates fell again primarily in response to negative economic data, including revised data that showed the economy shrunk more than we thought in Q1 along with more recession indicators and predictions. The 10 Year Treasury, which correlates closely to mortgage rates, hovered near 3.5% only a few weeks ago – but it is now under […]Read More

Good News! Recession Coming Soon; Rates Continue to Fall After Fed Raises “The Rate”

A week ago, I pointed out how the recent 0.75% increase in the Fed Funds rate resulted in LOWER long-term rates. I highlighted three reasons for this: (1) The markets perceived the news as effective inflation fighting; (2) the markets expected the news and had priced it in already; and (3) the Fed Funds rate […]Read More

Why The Fed Desperately Wants to TANK the Housing Market!

One of my favorite macro pundits, Alfonso Peccatiello (former $20 billion fund manager who goes by “Alf”) recently tweeted this: “The biggest group of consumers in the US owns houses, not stocks. And this is why taming the animal spirits in the housing market is paramount important for the Fed. And they will succeed…” He […]Read More

Fed Raised Rates & Mortgage Rates Fell – Before Rising Today

The Fed raised the Fed Funds Rate 75 basis points (0.75%) yesterday, and mortgage rates largely fell in response to the news.Read More

High Rates; Softer Market; ARMs; Housing Shortages; Recessions; Refis

Highest Mortgage Rates Since 2009 Last week’s sky-high inflation numbers have pushed 10-Year Treasury rates to levels we have not seen since 2018. While mortgage rates are at levels we have not seen since 2009. Beating A Dead Horse – Again The fast-climbing rates and media rumblings continue to spook buyers – so I am […]Read More

What If Rates Don’t Fall? WRAP-AROUND MORTGAGES

“… I remember my first mortgage back in 1982, when my rate was 15%!” said every boomer ever… “… I remember my first mortgage back in 1982, when my rate was 10%!” said my law school professor… The above two comments are huge reminders that homes still sell in even the highest of interest rate […]Read More

Barry Speaks! Fed Disdain; Recession & Low Rates Coming; Housing Will Be Fine

Barry Habib reminds us that it is inflation that is driving higher rates, but that it will peak in October and start to fall for two reasons: (1) today’s higher rates are destroying demand across the board (I again suggest watching the video for his full explanation); and (2) supply chains will be untangled and working by then, eliminating shortages.Read More

Why Housing Prices Will Double In 6 Years; No Bubble Here…Part 37

Interestingly, Barry Habib (MBS Highway Founder), Ken McElroy (famous real estate investor), and some dude on Reddit all recently made the case for much higher housing prices – DESPITE HIGHER RATES. And all of them were responding to all of the housing bubble fears we see everywhere now on social media and in the press. […]Read More

History of Interest Rates; Some Perspective

Are Rates High? Yes, rates are 2% higher than they were when they bottomed out after COVID hit and they are back to the 2009 levels, but are they “high?” No. Not even close when we look at the history of rates over the last 50 years. Here is a link to an excellent interactive […]Read More

Points, Discount Points, & Origination Fees – Avoid Them In 2022!

Even though distinctions can be made, Points, Discount Points, and Origination Fees are effectively the same thing, and they are used interchangeably. A “point” typically represents 1% of the loan amount. So, a 1/2 point is 1/2% of the loan amount, and so on. Paying a full point will typically “buy down” an interest rate […]Read More

Why There Is Still No Housing Bubble

Everyone Thinks Higher Rates Will Kill The Housing Market We shared this blog, Higher Interest Rates Did Not Slow Housing Appreciation; Why?, with our database in our monthly newsletter a few weeks ago, and I got this response from a past borrower: “You really think that if the Fed raises rates seven or eight more […]Read More

Why Heejin & I Turned Down $10 Million

We know a loan officer with a large team who does about half of JVM’s volume – and he was offered a $6 million “signing bonus” to move to another mortgage bank. He turned it down, however, and remained where he was (I will explain why below). With higher rates and refis all but dead, […]Read More

How High Will Rates Go Before Falling? What Will Be The Catalyst?

“The 10 Year Treasury yield will be north of 4% by the end of the year.” So says Joseph Wang, a former Federal Reserve insider and monetary expert, who was on today’s Forward Guidance Podcast. The 10 Year Treasury yield is around 2.6% as of the writing of this blog. 10 Year yields dipped as […]Read More

Make Sure You’re Offer-Ready! Check In On Rates & Your Pre-Approval Before Making An Offer

We like to periodically remind homebuyers to reach out to their lender to check their mortgage pre-approval before making offers, as interest rates are changing rapidly in today’s hot market. Many homebuyers are caught off guard during their homebuying journey when they realize that the interest rate lenders quote during the pre-approval process is not […]Read More

Why Higher Rates Could Save The Housing Market

One of the biggest issues facing the housing market today is a lack of inventory. And, ironically, the very rate increases that many fear will tank the housing market may actually save it. Redfin reported that investors purchased 18.4% of all residential real estate in Q4 of 2021. 3/4 of those purchases were “all cash.” And 3/4 of those purchases were for single-family homes too.Read More

Recession Coming Soon – Will It Bring Down Rates?

Barry Habib of MBS Highway fame was recently on the National Real Estate Post, discussing interest rates because that is what he does. Once again, I love quoting Barry because he has been one of the most accurate prognosticators in the vast realm of economic punditry. Also, his 20-minute interview is not behind a paywall, […]Read More

Why Did Interest Rates Fall After The Fed Ostensibly Made Them Rise?

The Fed recently raised rates, but interest rates fell in response. This is something we see so often that I had to blog about it – to again allay some of the confusion about the Fed’s rate increases. Rates are way up now, but recently they fell at least 1/8% AFTER the Fed announced the […]Read More

Why Do We Quote Rates With Points – When We Dislike Points?

On Tuesdays, we send out an email to our entire database that says “What’s Going On With Rates?” And – in that email, we share numerous rate quotes – and several are quoted at the cost of 1/2 point. In response to that email though, an agent we have known for years asked me why […]Read More

Higher Interest Rates Did Not Slow Housing Appreciation; WHY?

A surge in home prices continues despite the fact that interest rates have climbed significantly – and will likely continue to climb at least in the near term. So, the question is, why do prices continue to surge in the face of higher rates? Two Reasons: (1) High demand because of demographics; and (2) Low inventory.Read More

Inflation & Rates Increase But Industry Experts Still Bet On Low Rates

The current surge in commodity prices such as wheat, nickel, copper, and oil is fostering doom and gloom predictions – of mass shortages and runaway inflation. So, in light of that, why is Raoul Pal, the founder and CEO of “Real Vision” buying bonds in a bet that interest rates will fall? Pal thinks higher prices will crush demand and that a recession is looming.Read More

Rate Match Guarantee! Beware of POINTS! Rates: Sticky Down/Slippery Up

We now have a Rate Match Guarantee at JVM. If borrowers bring us a valid rate quote on a formal Loan Estimate before their rate is locked, we will match that quote. Our only exceptions will be for some portfolio jumbo loans offered by some of the major commercial banks.Read More

How The Ukraine/Russia War Is Impacting Rates

I wrote a blog last week about the potential impact that a Russian invasion into Ukraine would have on rates, and it was one of my most viewed blogs ever. In light of that interest, I am doing a brief follow-up blog to review what actually happened in light of the invasion yesterday. IMPORTANT NOTE: […]Read More

Attention Nervous Homebuyers: Rates Likely to Fall! Dr. Lacy Hunt Explains

Even though rates are still lower than where they were in 2018 (and for much of the last 10 years), homebuyers are still often very upset that rates have climbed so much in recent months. We frequently remind readers that homebuyers stress too much about rates in any case because so few of them keep their loans as long as they think they will (usually less than 7 years).Read More

$40,000 Dog! Rates Hit 3-Year High! Mortgage Stocks Might Be A Buy – Now :)

Rates Hit 3-Year High! That was the headline in the WSJ today – so I want to remind agents and borrowers alike to get “Re-Approved” because higher rates mean higher payments. Read More

When Will Rates Fall?

I had an acquaintance who was a very successful regional homebuilder in the 1990s and early 2000s. By early 2005, he was so certain we were in a housing bubble that he started to short the major homebuilders (Lennar, Toll Brothers, Pulte, etc.). By “shorting,” he was betting that stocks would fall.Read More

How Much Have Rates Risen? Will They Fall?

Last year at this time, the average conforming 30-year fixed-rate was about 2.7%, per Freddie Mac. Currently, the average conforming rate is over 3.7%. So, rates have risen a full 1% now over the last 12 months.Read More

The Fed Does Not Set Interest Rates! I Got Slapped Down Twice!

This is a quick reminder that the Fed does not set long-term interest rates! The Fed only sets the short-term “Fed Funds” rate– or the rate that banks charge each other to borrow money overnight. The Fed can influence long-term rates with its comments, with its partial control over the money supply, and with its […]Read More

Eliminating PMI – With Appreciation, Paying Down Loan, or Refinancing!

A client who bought in 2019 emailed me this week, asking how to get out of PMI. Because appreciation has been so massive over the last few years, there is no reason anyone should have kept their PMI in place for more than two years.Read More

What Are Current Mortgage Rates In Texas?

What Are Mortgage Rates Today You can view JVM Lending’s current mortgage rates for Texas loans on our website here. Our team updates these mortgage rate scenarios daily; however, our team is also available seven days a week for any questions or custom interest rate scenarios you may need as you plan your homebuying process. […]Read More

Jumbo Rates – Almost 1% LOWER Than Conforming; Going For Jumbo!

I actually blogged about why jumbo rates are so much lower than conforming rates in April, and here are some of the other reasons: (1) Jumbo loans have stricter guidelines so they are less risky; (2) Jumbo loans have tighter appraisal requirements – again impacting risk; (3) Big banks that fund or buy jumbo loans are desperate for yield and will take what they can get; and (4) Jumbo lenders want to establish relationships with well-off borrowers and will fund loans at a loss in pursuit of those borrowers.Read More

Rates Hit a Two-Year High – And We’re All Going To Die!

Rates shot up again yesterday – in response to increased concerns that the Fed is going to more aggressively try to push up rates in March in an effort to fend off inflation. Perspective, Baby! As a result, rates hit a two-year high! So, I want to put this in perspective. And – no, I […]Read More

Why You Can’t Get Yesterday’s Rate, Stock Price, or Bitcoin Price

My Angry Phone Call With Jeff Bezos! I recently called up Jeff Bezos last week and that he sell me Amazon stock for $6 per share because that was the price in October of 2001, when I wanted to buy 10,000 shares … but didn’t. I then explained to him that my $60,000 investment at […]Read More

How Much Do Higher Rates Affect Payments?

Recently, I facetiously wrote a blog about why rising rates would crash the housing market, pointing out that they actually won’t 😊. So – because of yesterday’s blog and because rates shot up again this morning – I wanted to remind everyone of just how little rate increases of less than 1% affect someone’s payment. […]Read More

A Second Home Vs. An Investment Property

Looking to purchase a second home? Or maybe your goal is to buy an investment property. It’s important to know the difference between an investment property and a second home. Especially because obtaining mortgage financing for each of the two is a very different process where the costs can vary dramatically.  Differences Between Second Homes And […]Read More

Insanely WRONG Predictions! More Coming Soon; Please Ignore Them :)

CoreLogic predicted home prices would decline by 6.6% in 2021 – and they were off a little. Home prices appreciated by almost 20% in 2021! What makes this enormous error so fascinating is the fact that CoreLogic is considered to be the granddaddy of data collection and analytics when it comes to the housing market. […]Read More

Fed Announces 3 Rate Hikes… And Rates Dropped! WHY?

The Fed sent the markets into a tizzy recently, finally admitting that inflation is now a serious problem and that there would likely be as many as THREE RATE HIKES in 2022. The bond and mortgage-backed securities (MBS) markets reacted negatively, and every lender announced a series of mortgage interest rate increases as a result. […]Read More

Mortgage Rates Do Not Equal 10-Year Treasury Rates

The 10-Year Treasury Yield dropped almost 4/10% recently – so why didn’t mortgage rates drop that much? The 10-Year Treasury yield (interest rate) is a reflection of what it costs the government to borrow money and is perhaps the most influential interest rate/yield in the world. Hence, when the 10-Year yield drops, the media will […]Read More

Why Are Rates Not HIGHER – With Inflation, Fed Tightening, & Economy Improving?

HORRIFIC SPACE SHUTTLE CRASH On January 28th, 1986, the entire world watched the Space Shuttle Challenger explode and crash to the earth – on live TV. Seven people lost their lives, including school teacher Christa McAuliffe, right in front of our eyes and – everyone wondered what the hell happened? The talking heads in the […]Read More

Rates Have Not Been This High Since… 2021

RATES HAVE NOT BEEN THIS HIGH SINCE 2021! I thought I would put interest rates in perspective again, given that they have risen so much (1/4% to 3/8%) since last summer and that there is so much concern! But – they are still slightly lower than where they were on April 1st of THIS YEAR! […]Read More

The 6 Forces Driving Interest Rates

  THE THREE FORCES DRIVING RATES The mortgage industry’s primary voice/blogger, Rob Chrisman, recently wrote this: “There are three forces driving mortgage rates these days: uncertainty about the effects of the pandemic drives money to the safety of fixed income securities (mortgage bonds) moving rates lower; inflation fear backed by data moves rates higher, and […]Read More

Why Lenders HATE Jumbo & Why JVM’s Jumbo Rates Are SO LOW

JVM FHA OFFER ACCEPTED OVER CASH OFFER As a brief aside – one of our clients recently had his 14-day-close FHA offer accepted over an all-cash offer – at the same price. Why? The listing agent knew our reputation and knew the appraisal would not be an issue (b/c of comps and b/c our buyer […]Read More

Rates Shot Way Up Yesterday; Why? Will They Come Down Again?

Interest rates shot way up yesterday – catching most of the industry by surprise (again). This is because rates have held amazingly steady for the last several months – but now rates are back up to levels we have not seen since early July. WHY DID RATES GO UP? The primary reason is a “Taper […]Read More

Are China’s Woes Good for Mortgages and Real Estate? Yes, and No

CHINA LOWERED OUR INTEREST RATES Rates opened up lower today, partially because of the issues China is having with some of its more debt-laden companies such as Evergrande (the huge Chinese Developer teetering on bankruptcy, that was all over the news last week) – according to Barry Habib of MBS Highway. Mr. Habib reminds us […]Read More

Still No Housing Bubble – Because Rates Are 3% Lower Than In 2006!

MBS HIGHWAY HITS HOUSING BUBBLE AGAIN Barry Habib, Founder of the MBS Highway, hates it when the media spreads irrational fear about a housing bubble. He also shares marketing materials that subscribers to his content are allowed to share without attribution to him, but that is anathema to me. Below is a script he recently […]Read More

Inflation Up; Rates Up; Explained In Terms of Porsches; All About “Buying Power”

THE REFI BOOM THAT WASN’T When rates plunged a few weeks ago in response to renewed COVID concerns and weak economic news, the entire mortgage world was gleeful b/c we thought we had another refi boom on our hands. But alas, it was not meant to be, as strong employment numbers AND INFLATION crashed the […]Read More

Using PMI To WAIVE Appraisal Contingencies

Many homebuyers do not realize that PMI can be an option for those who might want to make offers with no appraisal contingencies. This, of course, is a great idea, but with a HUGE CAVEAT: BEWARE OF JUMBO! PMI is always a great way to cover appraisal shortfalls on the conforming front. Example: Borrower intends […]Read More

Why Housing Is Actually More Affordable Today Than In 1980!

WHY HOMES ARE MORE AFFORDABLE TODAY In the midst of my daily excursion into the bowels of Twitter, I saw a great tweet from the Center for Human Progress. It had a link to this excellent article, titled U.S. Housing Became Much More Affordable Over The Last 40 Years. It was fascinating to say the […]Read More

Beware of VACATIONS :) Rates Way Down Again; Why? Stimulus Will End

HOLY LOW RATES, BATMAN! (Wallowing in Wrongness) For months now, I have been repeating the warnings of various pundits about runaway inflation and rising rates. But rates seem to continually fall despite inflation concerns, and this week was another example as rates fell precipitously again. I and many others (like Barry Habib) thought we’d see […]Read More