David Haley Mortgage Loan Officer | Fairway Independant Mortgage Corporation

Mortgage Rates Jump Going Into Long Weekend

Mortgage rates jumped rapidly on Friday, with losses among the worst so far in the year. However, as young as the year is, the outright levels are only the fourth lowest in the past twelve months.

It’s no mystery why we’re experiencing such a dramatic upturn. After all, with the prodigious moves toward lower rates we have experienced in the past months, it’s only natural that we should experience a bounce-back. The question that is on many investors’ minds right now is whether this represents the start of a long-term trend, or if this is simply the product of the caution that is so often practiced heading into a three-day weekend, combined with the activity of stock and oil traders covering short positions.

If you failed to lock into rates before this reversal, don’t worry too much. It is entirely possible that rates will recover to their 2016 lows in the near future. However, considering the relative overall strength of mortgage rates, it’s not the worst thing in the world to lock in.

Mortgage Rates Drop to Lowest in Twelve Months

This week opened with a sharp drop in mortgage rates. Most lenders have been offering their lowest quotes in almost a year. While many others have been sticking with Friday’s rates, they have been pairing these with lower closing costs.

Generally, you can’t expect rates to move this dramatically more than twenty times throughout a single year. In this case, the drop can be attributed to MBS, or “mortgage-backed securities”, representing the bonds that are most closely related to mortgage rates. When trading is calm, such bonds behave like you might expect from the interest rate world, but when the rest of the interest rate world is rapidly moving lower, they have a tendency to underperform. Therefore, when ten-year treasuries were down 10bps on Monday, lenders adjusted their mortgage rates accordingly.

Should market trading levels hold their ground, mortgage rates could very well drop even further. Of course, the risk of a significant bounce offset the possible benefits of floating. Locking into the current lows is the best choice for most people.

Home Affordability is Up, but On its Way Down

Blog Lynnwood Loan Officer – Mortgage Loans February 11th, 2016 David Haley Mortgage Loan Officer

Black Knight Financial Services took a close look at trends in home affordability and the recent surge in cash-out refinances, as it applies up through the end of December. According to the data they gathered, there have now been a total of forty-three consecutive months of annual appreciation in home prices. Further, through the use of national medians of home prices and household incomes, they found that the ratios of mortgage payment-to-income remain favorable, according to historic standards.

When the group looked at the median principal and interest payments for October of the last fifteen years, they observed that such payments consumed fully 26% of a median household’s income in 2000, rising to a peak of 33% in 2006, and then falling all the way down to 18% in 2012. In October of 2015, this figure was at 21%, below the median of 26% for the past fifteen years and within the realm of reasonable affordability.

Unfortunately, the trend seems to be upward. The group is projecting that median principal and interest payments will reach 24% of median income in 2016, and surpass the median in 2017

Delinquent Mortgages Down, Prepayment Up

Blog Lynnwood Loan Officer – Mortgage Loans February 1st, 2016 David Haley Mortgage Loan Officer

The good news about the past year’s real estate market continues to come in. According to Black Knight Financial Services, the past twelve months brought us a substantial improvement in mortgage performance. It would appear that there was a 22% decrease in foreclosure inventory nationwide, and a 15% decrease in the number of delinquent mortgages.

The number of mortgage loans that were at least thirty days past due, but not in foreclosure proceedings. At the end of the year, there was a total of 2.41 million delinquent mortgages, representing a drop of about 425,000 from the end of 2014. Meanwhile, there was a total of 689,000 properties in the middle of foreclosure proceedings at the end of the year, representing a drop of about 9,000 from November and 192,000 from the end of 2014.

Black Knight also tells us that the rate of prepayment is also on the rise. In December, this metric was higher than it was in the end of 2014.

Mortgage Rates at Lowest Since April

Blog Lynnwood Loan Officer – Mortgage Loans January 25th, 2016 David Haley Mortgage Loan Officer

This year started out strong and, despite an exceptionally strong jobs report, the trend for mortgage rates has remained favorable. In fact, rates have been plummeting at their quickest pace recently, to the point where most brokers are offering quotes that are approaching seven month lows.

Current downward movement can be attributed to the heavy losses being seen in stocks and oil prices. Investors are currently reacting to the higher risks associated with these assets by taking money out of them. When this happens, they are generally putting their money into the relatively safer bond markets, which results in a dip in mortgage rates.

The big question to ask right now is whether we can expect stocks to bounce back soon, sending mortgage rates up again, or if this is the beginning of an even bigger sell-off, like the ones we saw following the peaks in 2000 and 2007. Since this is difficult to predict, it make it hard to decide whether to float or lock. However, with rates where they are, it’s hard to argue that it’s a good time to be in the market.

Mortgage Rates Defy Jobs Report Again

Blog Lynnwood Loan Officer – Mortgage Loans January 14th, 2016 David Haley Mortgage Loan Officer

Last week’s monthly jobs report proved to be quite strong, adding 292,000 jobs. This exceeded the predicted 211,000, and makes for a grand total of 2.65 million for the ear. At this point, we can see that 2015 was the second best year since 1999.

Usually, economic data like this is likely to send mortgage rates higher. In fact, a report this exceptional should have been a sure bet for a significant uptick. However, once again, mortgage rates are defying expectations. On the Friday following the report, rates actually moved down to achieve a two-month low.

Much of this can be attributed to weakness in other areas of the economy. Specifically, investors are concerned about the lack of income growth, the losses in global stock prices, the downturn of oil prices, and continued concerns about the implications of the Fed rate hike. They are therefore moving away from risky stocks to buy bonds, which moves mortgage rates lower. There is no telling how long this can last, though, so locking into current lows may be advisable.

American Warrior Initiative – Giving Back in 2015

Blog January 12th, 2016 David Haley Mortgage Loan Officer

13 Months of Giving Back with AWI

By Louise Thaxton

“For the past 13 months, Fairway entered into an entirely different season of giving back to the wounded heroes of America. Dozens of local initiatives were funded by the Fairway branches across the nation which took the American Warrior Initiative to an entirely new level.

As the AWI team traveled the nation, real estate agents became excited about giving back and asked for a way to get involved. This lead to the development of the “Lead the way 5K” to be led by Ben Lunak who was actually a recipient of a grant for his fitness business.

The “Red Friday” campaign kicked off challenging thousands of individuals to wear red on Friday to “remember everyone deployed” and the donation of $22.00 for each shirt to go to the funding of local initiatives and to honor the 22 veterans who take their own lives every day.

More than just changing lives in 2015, AWI became about SAVING lives as several veterans testified that the gift they received – whether it was a service dog or 12 months of rent paid on their behalf – actually SAVED their lives.

Now – onward to 2016 – making a difference in the lives of the people we serve!”

READ ORIGINAL ARTICLE HERE

Looking Back at Mortgage Rates of 2015

Blog Lynnwood Loan Officer – Mortgage Loans January 5th, 2016 David Haley Mortgage Loan Officer

Looking back at the last year, we can see that 2015 was an interesting year for the mortgage market. Going into the year, nearly everybody was expecting a move towards higher rates. However, Europe’s new bond buying program and various other factors made conditions right to instead see strong, long-lasting moves downward. Later on, the market saw some more turbulent moves in anticipation of the Fed’s rate hike.

The final word is that, on average, 2015 was a stronger year for mortgage rates than 2014. However, compared to 2014, 2015 saw more of an upward trend. Part of this can be attributed to the fact that 2014 ended on the very lowest rates of the year, while 2015 ended on rates that were close to the year’s highest.

We can likely expect rates to continue to rise for a while until the economy starts to show signs of stagnating. This could very well take months, or even years. Fortunately, any upward movements should be less dramatic than they have historically been.

What to Expect in the End of 2015

Blog Lynnwood Mortgage Loan Officer December 30th, 2015 David Haley Mortgage Loan Officer

We’re going into the final week of 2015, which means that there are only four more days to close loans this year. With fears about what to expect in the coming year, including fines, unsaleable loans, and UDAAP violations, many people are having to make tough decisions as to whether to lock in now or wait until after the start of 2016. So, what’s the best choice?

Fortunately, both Christmas and New Year’s Day fall on a Friday this year. This makes it easier to predict market activity. At the moment, the momentum continues to be fairly flat. For the next few days, we’re looking forward to the 5 year Treasury Auction, the 7 year Treasury Auction, the Case Shiller Home Prices, and Consumer Confidence reports. Any of these could have a powerful effect on mortgage rate activity, up until the markets close early on Thursday and remain closed throughout the New Year celebration. However, we’re not expecting much activity from this cycle of auctions. All things considered, the current flat trend may very well continue into 2016.

Volatile Movement in the Holiday Season

Blog Lynnwood Mortgage Loan Officer December 23rd, 2015 David Haley Mortgage Loan Officer

Mortgage rates were already near 2015 highs going into the Christmas holiday. On the 23rd, activity in mortgage-backed-securities only made this problem worse. Though the movement in MBS was a relatively small one, and one that would usually translate to a very slight change in mortgage rates, rates moved up to their highest level in the past five months.

This unusual fluctuation can be attributed to the volatile nature of the holiday season. Lenders are considerably more conservative about adjusting their rate sheets when market activity dies down during the holidays. The previous day was a far weaker one for MBS activity, but many mortgage lenders were not adjusting their rate quotes as much as they may otherwise have. Therefore, the 23rd started off on a much weaker foot than rate sheets indicated.

If you are trying to decide whether to float or lock, it would seem that the odds are in your favor. Should MBS prices linger where they are, mortgage rates could experience a significant improvement as we head into 2016.

13 Months of Giving Back with AWI

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