Tag Archive for: mortgage rates

The 2nd Biggest Problem in Real Estate (& It Is HUGE)

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EXPECTED LIFESPAN OF CALHFA’S DREAM PROGRAM: < 90 DAYS This a brief reminder that CalHFA’s Dream For All Program (100% financing/shared equity program) will very likely run out of funds in the near future. Hence, agents and borrowers need to move quickly if they want to take advantage of it. BIGGEST PROBLEMS IN REAL ESTATE […]Read More

Europe Raised Rates by 1/2%, and Rates FELL

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The European Central Bank (ECB) raised its short-term rate (its equivalent to the Fed Funds Rate that the Fed raises here in the U.S.) by a full 1/2% yesterday. It shocked many observers because Europe is facing a banking crisis that is potentially much worse than what we face here in the U.S. (for reasons […]Read More

FHA Rates Even Lower! I Hope Buyers Stay Home :)

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BOOMER ERROR! On Friday, I pointed out how FHA rates are now often far better (by over 1%) than Fannie Mae Rates in this blog: FHA Keeps Beating Fannie Mae! And, I tried to impress everyone with an FHA rate quote – that I got wrong! I quoted 6.125% for a no-points loan, but the […]Read More

Rates Climbed 1% in February! Great Opportunity For Buyers!

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WHY IS MY CLIENT’S RATE SO HIGH? That is a question we have heard from several agents over the last week. The primary reason is usually just a misunderstanding of just how much rates have risen over the last month – almost 1%! I have included a screenshot of The 30-Year Fixed-Rate Mortgage Chart from […]Read More

MBA “Purchase Index” Falls to Lowest Level Since 1995! Panic Time?

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Rates have climbed almost a full 1% point since early February, as this Mortgage News Daily Chart indicates. In direct response to this increase in rates, purchase money mortgage applications plummeted – showing once again how sensitive buyers are to interest rates. And – the Mortgage Bankers Association “Purchase Index” (based largely on mortgage applications) […]Read More

GREAT NEWS! 10 Year Treasury Yields No Longer Track Mortgage Rates

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The 10 Year Treasury Yield is 3.46%, as I am typing this blog. The average 30-Year Mortgage Rate is 6.21%, per Mortgage News Daily. That is a spread of 2.75%. What makes that so interesting is the fact that prior to 2022, the spread between the 10 Year and Average Mortgage Rates was about 1.7%, […]Read More

The Fed Does NOT Control Interest Rates! Follow the Data Guys!

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  The Fed raised “rates” last year at the fastest pace in history! There were 7 “rate” increases in total: 0.25% in March 0.50% in May 0.75% in June 0.75% in July 0.75% in September 0.75% in November 0.50% in December BUT – DESPITE INCREASES TOTALING 1.25% OVER NOVEMBER AND DECEMBER, 30-YEAR MORTGAGE RATES HAVE […]Read More

Why Did Rates Shoot Up 3/8% Over the Last 10 Days?

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Dear Congress, Please stop spending money. I know it helps your careers… but it really hurts the rest of us. Sincerely, Jay That was the letter I wrote to Congress, but they ignored me – again. It was unfortunate too because the $1.7 trillion spending bill Congress just passed is just one of the reasons […]Read More

Surge In Contracts, Pre-Approvals, And Returning Clients

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Rates fell again today, exactly like macro pundits Jeff Snider and Barry Habib have been predicting for about a year now. Once again – they both told us earlier this year that rates would fall in response to signs of economic weakness and slowing inflation. I make such a big deal about this over and […]Read More

Inflation Slows & Rates Drop AGAIN; WHY SO IMPORTANT?

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Rates plummeted yesterday after Fed Chair Jerome Powell made some comments indicating that the Fed will start to slow its rate increases. Rumor has it that he got early notice of today’s delightfully tame inflation reports, and thus decided to back off on his “hawkish” efforts to keep pushing up rates. 10-YEAR TREASURY YIELDS FELL […]Read More

THIS IS HUGE! Inflation & Rates PLUMMET!

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Inflation Came In Cool – Exactly As Barry Habib And Jeff Snider Predicted! In 2021, I told a group of mortgage bankers at a lunch how and why rates were going to shoot past 7% in 2022 – and NONE of them believed me. Despite their pushback, I remained very confident in my position because […]Read More

How Interest Rates Impact Home Values (Not What You Think)

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“Jay, How Naïve Are You?” That was the response I got from a past client last spring when I was noting how higher interest rates had not yet impacted home values. I made the further mistake of saying I was not sure how much higher rates would impact values too, in light of all the […]Read More

The Fed Did NOT “Raise Rates 3/4% Yesterday” – Deflation/Lower Rates Coming Soon Part II

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The Fed raised rates 75 basis points or 3/4% yesterday – so my rate quote at the bottom of this blog went from 6.0% yesterday to 6.75% today. FALSE!! THAT DID NOT HAPPEN! My rate quote today is the same rate as yesterday’s even though the Fed “raised rates 3/4%” yesterday. I typed the top […]Read More

It’s The Inventory, Stupid! (Why Values Are Not Crashing)

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Before I explain who I am calling “stupid,” I want to touch on numerous comments I received in regard to Monday’s Blog: Why Everyone Needs A House As An Inflation Hedge Now More Than Ever. All of the comments reminded me that it is NOT just the house that is the inflation hedge, but it […]Read More

Lenders Pushing “Stated Income” & 100% Financing; Return of 2008?

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A Few More Notes On Rates Dropping By March I got a bit of pushback from yesterday’s blog (Why I Am Convinced Rates Will FALL By March) and I wanted to touch on it quickly before hitting my main blog points today. The Fed Is No Longer Buying Mortgage-Backed Securities (MBS). Yes, the Fed is […]Read More

Why I Am Convinced Rates Will FALL By March

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I have myriad acquaintances in the mortgage industry (mortgage bank CEOs even) who insist rates will continue to rise throughout 2023. They tell me I am crazy to think they will fall as early as March – with inflation surging and the Fed on the warpath. They further tell me that the Fed cannot get […]Read More

Everything Lags…Making The Media & The Fed Wrong (AGAIN)

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In 1992, the rock band R.E.M. released the annoying song, Everybody Hurts. And, sensitive Gen Xers everywhere played it loudly and proudly on their Sony Walkmans and boomboxes to prove just how sensitive they really were (and they were sensitive!). But, fortunately for us, Michael Stipe retired from R.E.M. so he could watch macro videos […]Read More

Are Rates Really Over 7%? Not Really; Rates Up 2% Since August; Surveys Lag Market

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Today’s average interest rate is 6.82% per Mortgage News Daily (about 1/2% higher than where they were last week). The average is up almost 2% from early August when it bottomed near 5% – amazingly. The average rate was in fact over 7% yesterday, but they plummeted today (and I will explain why below). The […]Read More

Rates at 2008 Levels! When Will Rates Fall?

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Mortgage Rates Top 6% for the First Time Since the 2008 Financial Crisis The above is a WSJ headline for this article. Rates are also back to where they were … way back in June and somehow we survived July and August 😊 Rates shot up this week in response to higher than expected inflation […]Read More

Inflation Drives Interest Rates – Except When The Fed Gets Involved

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As most people know, inflation drives interest rates because investors do not want to accept yields that are lower than the inflation rate because they will effectively be losing money if they do. If you loan somebody $1,000 for one year at 5%, and inflation is at 8%, at the end of the year, you […]Read More

Rising Housing Payments – In Perspective!

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The below chart was circulating on Twitter recently – and it of course made potential homebuyers unnecessarily apprehensive.   Yes, payments have surged, but I want to put this in perspective. Interest Rates: While rates have risen sharply from the lows we saw during the COVID crisis, they are only about 2% higher than where […]Read More

Rates Went Way Down Because Rates Went Way Up (AGAIN)

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The Fed raised the Fed Funds rate by 0.75% yesterday as expected, and long-term rates have been falling ever since. I would not beat this dead horse again but for the fact that rates are continuing their slide downward as I type, and because of how important this all is for housing and mortgages. As […]Read More

The “Fed” Does NOT Control Mortgage Rates

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The Fed controls the short-term “Fed Funds Rate,” or the overnight rate that banks charge each other. The Fed does NOT control long-term rates like the 10 Year Treasury or 30-year mortgage rates. The Fed can influence long-term rates with its comments and by raising the Fed Funds rate, but it does not have the final say.Read More

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

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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

Fed Raised Rates & Mortgage Rates Fell – Before Rising Today

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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

Huge Opportunity From High Rates!

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Grizzled Escrow Officer Sets Me Straight! While aimlessly wandering the hallways lamenting the industry slowdown, I ran into a very grizzled escrow officer who runs the title company next door. She is one of those utterly fearless women who has been around forever and has literally seen it all. She handled George Washington’s escrow when […]Read More

Save Money With Seller-Paid Rate Buydowns Instead of Price Reductions

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A “rate buydown” gives borrowers lower interest rates in exchange for higher fees or “discount points” paid up front (when they close). We discourage rate buydowns in general because borrowers rarely hold onto their mortgages long enough to make the extra points or fees worth the added expense. But – if sellers are willing to pay for the rate buydowns, my opinion changes quickly.Read More

Goldman Sachs Still Buying Homes; Rates Dropped The Most In 2 Years Last Week – Why?

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Goldman Sachs-Backed Funds Bought Entire Housing Development I saw this recent New York Post article on Twitter yesterday and thought it would be another nice share for any potential buyers who might have cold feet. TLDR: Two Goldman-backed ventures just spent $45 million to buy up an entire housing development in Florida. The big funds […]Read More

Adjustable Rate Mortgages Hit 14-Year High

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ARMs now comprise 11% of all mortgages, up from only 3% at the start of the year. And the reason is obvious: consumers can knock 1% or more off of their mortgage rate by taking an ARM instead of a 30-year fixed.Read More

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

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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

Is The Fed Trying to Tank The Housing Market – Or Just Slow It Down?

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Agents in many of the markets we work in are telling us that they are now finally seeing a slowdown in the market. One agent who lists high-end homes in the Bay Area told me that he “used to tell sellers to remodel their kitchens, update flooring, repaint walls, and spruce up landscaping before listing […]Read More

Rates Back to 2009 Levels; Time for ARMs!

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Mortgage rates have climbed to their highest level since 2009! One way to combat the rise in rates is to take an ARM instead of a 30-year fixed-rate loan.Read More

Pyramid Lending = Death of Mortgage Banks

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During boom times, when there is excess business and margins are fat, “pyramid lending” can work. But – when business slows and margins compress like what has been happening this year – pyramid lending not only does not work, it will kill off many mortgage banks. This is because borrowers can shop for rates and apply for loans more easily than ever nowRead More

17 Day JUMBO Financing – With No Contingencies & Super Low Rates!

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I often blog about how jumbo rates are as much as 1% LOWER than conforming rates and explain why too. This recent blog is just one example. Our Jumbo Niche I obsess with jumbo financing not only because it offers astoundingly low rates, but also because it comprises as much as 75% of all financing […]Read More

Why There Is Still No Housing Bubble

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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

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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

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

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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

The #1 Most Terrifying Factor Pushing Rates WAY UP!

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We have all been hearing about Quantitative Easing (QE) and the Fed’s Balance Sheet for years now – without really understanding what it is or its effect on the market. QE is where the Fed buys up both Treasuries and Mortgage-Backed Securities (MBS) in an effort to keep rates lower than they otherwise would be […]Read More

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

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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

Why Russia/Ukraine War Drums Impact Mortgages & Real Estate So Much!

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Interest rates were trending upward before news surfaced that NATO believes Russia is still likely to invade Ukraine (because so many Russian troops are amassed at the border). When the news surfaced, rates dropped sharply in response.Read More

How Much Have Rates Risen? Will They Fall?

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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!

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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

What Are Current Mortgage Rates In Texas?

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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

Fed Comments Push Rates Up; Re-Casting Problems!

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Interest rates shot up again yesterday, as the Fed indicated that it may increase the Fed Funds rate faster (as much as 1% this year) than previously anticipated. The Fed also implied that it would stop buying mortgages and bonds (via “Quantitative Easing”) which would put further upward pressure on rates. Read More

What Is A Conventional Loan?

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What Is A Conventional Loan Conventional loans are a favorite for homebuyers with decent credit scores and who have a fair amount of funds for a down payment. Conventional mortgages should not be confused with “Conforming Mortgages.” Conventional mortgages are institutional mortgages that are not insured by the FHA (Federal Housing Administration) or guaranteed by […]Read More

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

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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!

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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

Will We See Negative Interest Rates In America? (Hint: We Already Are)

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Mortgage Rates Are More Of A Gift Than Ever! I often write that the market’s very low interest rates are a gift because they are so low by historical standards! (and it’s true) And, they are more of a gift than ever before now, despite the fact they have risen by 1/2% since last summer, […]Read More

How Much Do Higher Rates Affect Payments?

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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

Why Rising Rates Will Not Crash The Housing Market!

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Rates rose another 1/8 to 1/4 percent over the last few weeks and are now almost 1% higher than 2020’s lows. (as a sidebar, they are about where they were last March…so they are not THAT high) But, whenever rates do start to rise in a hurry, I invariably see pundits explaining how rising rates […]Read More