Tag Archive for: mortgage

Rates Shoot Up On Hot Jobs Report! Uh Oh – Huge Mortgage Bank Starts Clothing Line?

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I have concrete proof that mortgage banks are getting absolutely desperate – and I will explain why below. But First – Uh, Oh – The Economy Is Hot! On Wednesday, I blogged about how the economy might be much hotter than we realize – and how that will put upward pressure on rates. And sure enough, we got a very hot jobs report today, and it pushed rates way up again. It was a BLS report (so not particularly trusted), and many jobs were in government and healthcare (less healthy growth), but it still contained many reasons for optimism. I say “uh oh” above because a hot economy and strong jobs reports push rates up. And this was not on any mortgage bank’s bingo card earlier this year – when I predicted rates would fall to 5.5% (right before Iran and oil price spikes pushed rates up by almost 3/4%).Read More

Hidden Data That Proves Our Economy Is BOOMING – Bad For Rates & Good For Rates; GREAT For Real Estate

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Rates are UP again today because of increasing tensions with Iran, and - because our economy is booming (darn it!). Iranian tensions push up oil prices, sparking inflation fears that push up rates. But a booming economy also pushes up rates, as bond investors demand higher yields when they expect strong growth (because they think it will foster inflation and/or Fed rate increases, and because bonds have to offer higher yields to compete with booming stocks).Read More

Rates Are High, But Not THAT High; Perspective; Solutions?

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Today’s average mortgage rate hovers around the 6.75% mark - a full 3/4% higher than the 5.99% we saw prior to the Iran War. The mortgage industry, which had ramped up for what they thought would be a banner year with steadily falling rates, is in panic mode. High rates are why there has been and will continue to be a wave of mergers and acquisitions, as many mortgage companies are simply giving up. The real estate industry is feeling the pain too, as rates heavily influence buyer activity.Read More

Stock Market Crash Is Coming FOR SURE; Preventing It Will Push Rates Higher

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We are going to see a 1987-style stock market crash (only worse) for sure, and it is only a matter of when. I have blogged about this many times, but investing guru Mike Green was just on this Julia La Roche podcast - Why A 1987-Style Crash Is Now Almost Inevitable – explaining why. So, I am hitting it again for two reasons: (1) the podcast is very short – so every investor should listen to it; and (2) I am adding another twist to explain why this threat will lead to higher rates.Read More

Oil & Rates Plummet; Why “Portable” Mortgages Are A Really Dumb Idea

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Oil prices plunged last night on credible rumors that the U.S. and Iran are close to an agreement to end the war. And, as I’ve been noting since the war started, as goes oil, so go rates. Rates fell sharply Portable mortgages are loans that homeowners can transfer from one home to another. Naïve housing analysts often float portable mortgages as a great way to free up “locked down” inventory (homes with very low rates that owners do not want to lose – so they refuse to sell). Homeowners with very low rates also often get excited by the prospect of portable mortgages.Read More

Iran Tensions Push Rates Up Again; Dead Boomers – Good or Bad? Appraisal Waivers Saving Deals!

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Mortgage rates bottomed out at 5.99% on February 27th – the day before the Iran war started. Rates peaked one month later on March 27th – hitting 6.625%. Rates then fell steadily into April but have since been rising in response to escalating tensions and rising oil prices. I share all this because rates shot up again today in response to Trump’s latest action, called “Project Higher Interest Rates.” OK – actually it is called “Project Freedom.” It is an effort by the U.S. to restore freedom of navigation through the Strait of Hormuz and free stranded commercial vessels. This action escalated tensions and pushed oil prices (the main cause of higher rates) higher again. Today’s average mortgage rate is 6.52%. We’re still below the peak we saw in March, but we’re getting close.Read More

Why Did My Mortgage Payment Go Up? Escrow Shock Explained

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Your mortgage payment just went up and you have a fixed-rate loan. Nothing changed in your contract. So what happened? You are not alone. Average escrow amounts rose 45% between 2019 and 2025, and roughly 4 in 10 borrowers do not realize their monthly payment can increase even on a fixed-rate loan. The culprit is almost always rising property taxes and homeowners insurance catching up in your escrow account. Here is exactly what happened and what you can actually do about it.Read More

Uh Oh!! Fed Says No More Rate Cuts This Year!! Panic Time?

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Interest rates shot higher yesterday after the Fed signaled there would be no further interest rate cuts this year. And because 99% of Americans mistakenly believe the Fed is all-powerful when it comes to all interest rates, I am going to dispel the Fed myth one more time. We share these blogs with clients who insist on “waiting for the Fed to cut” before buying homes or locking in rates. SIDEBAR: This post explains that for every $1 rise in gas prices, the sitting president loses 6% of his support – meaning Trump has now lost 15% of his support. A) It is super interesting. B) You can be damned sure Mr. Trump is aware of this, so it will be interesting to see him pull out all the stops to push oil and gas prices lower. And that bodes well for rates.Read More

Expect Higher Rates In The Near Term; Two Huge Takeaways

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I predicted mid to low 5% mortgage rates later this year several times in blogs and talks – but I did not expect three things: Ukraine to get so good at attacking Russian oil facilities. The Iran war, and its continuance. And Too fast of an increase in the money supply. As recently as two weeks ago, I discussed energy analyst Doomberg’s reminder that oil producers always overproduce in response to high oil prices, which always results in gluts later on. Doomberg predicts that oil will drop to as low as $30 per barrel (from $105 today). But that could take several years to play out. High oil prices push up all other prices, sparking the inflation concerns that have been pushing rates way up since the Iran war started. Iran’s resistance and Trump’s escalatory language pushed oil prices up to a new high today, and rates are up again as a result.Read More

Seller-Financing Horror Show; Know When To Walk Away, Know When To Run…

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One of our seasoned listing agents just received a seller-financing request that is so crazy, brazen, risky, and awful – that I had to blog about it. Fannie Mae and Freddie Mac guarantee mortgage financing scenarios that no commercial bank would ever offer. These include low-down-payment scenarios (10% or less), weak-credit scenarios (scores under 680), and high-debt-ratio scenarios. This enables cash-starved and less-established borrowers to buy homes – but it also, of course, artificially inflates demand and housing prices (a topic for another blog).Read More

Buy vs. Rent: This ONE HUGE REASON Makes All Other Reasons Almost Irrelevant

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I have blogged numerous times about “rent vs. buy” comparisons, illuminating the many reasons buying beats renting. But – there is now one reason to buy that looms so powerfully over all the others – that all the others are almost irrelevant. And don’t get me wrong, as the other reasons remain very powerful – and they include the following: Buying fixes your housing payment. We’ve seen rental rates double in many markets over the last six years, and we’ll see them shoot up again with the inevitable inflation we’ll see again.  Owning allows you to build equity with your housing payment.  Owning allows you to benefit from appreciation.  Owning allows you to do whatever you want to your home. In a survey several years ago, this reason ranked among the top reasons homeowners said they were happy they bought. It was not the financial reasons. It was the emotional, and all too many financial analysts discount this factor. I also often share this “Rent vs. Buy Calculator” from Freddie Mac – which pretty much always proves buyers will be better off in 5 to 7 years, no matter how conservative the assumptions are.Read More

“Dear Buyer, The Market’s Not Soft; Please Don’t Lowball;” Cockroaches Kill Deal; 10 Day Closes Reign Supreme!

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Many of the markets we serve are, in fact, very cool, with inventory builds and price discounts (mostly across the Sunbelt). It’s fascinating to see how some very hot markets are only a few miles away from some very cool markets, too – in all states. The crash bros are constantly posting about the soft markets alone while ignoring the many very hot markets. Homebuyers are seeing this onslaught of housing doomerism, firmly believing they can find “deals” in every market, and insisting on either lowballing or underbidding in the face of fierce competition. I bring this up because we are seeing our buyers get outbid over and over. This is one more reason we should all teach buyers to ignore the crash bros.Read More

What Does PITI Mean? A Mortgage Payment Guide

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Lots of borrowers are unsure what “PITI” means when it comes to their home loan. PITI is a common term used within the mortgage industry to describe the four factors that impact a loan. PITI (pronounced “pity”) stands for:Read More

Rates Fall Back to the Sweet Spot After Oil Crash

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Oil Prices (WTI) Plummeted To $92 Per Barrel From $104 Per Barrel On Monday. Interest rates followed and are now almost 3/8% LOWER than they were a few weeks ago. This unprecedented plunge in oil prices indicates again that very astute oil traders believe the Iran war will not escalate (again, huge investors with money on the line are often more accurate predictors of world events than “expert” pundits).Read More