The big economic news: the Fed surprised many by choosing to continue their QE3 program.
They said they needed to see stronger signs in the economy before stopping or even cutting back the $85 billion per month in purchasing of their own debt instruments.
They said growth looks flat for this year and even deep into to 2014. So on that news, rates dropped .25% in 1 day and the stock market rallied to new highs. A relief after all the rate increases we’ve seen in the last few months.
What next? We will probably see slightly lower rates but the newest Washington deadlock (and influence on the market) is the raising of our debt ceiling.
So as a family (congress) we have sit around the kitchen table and decide whether to raise our debt ceiling or just not pay our bills with the consequence of hurting our credit.
Now you and I would probably cut back some spending, but apparently our family members in Washington DC are having trouble with that… we’ll wait and see. in the meantime don’t gamble, LOCK IN!
If you have a client who is close to having an offer accepted and is nervous about rates, don’t worry because interest rates can be locked in over the weekend.
Remember we also have the float down: if rates improve more than .25% after lock-in the client gets the lower rate.
All rates are quoted at a 45 day lock in and assume a 720 credit score with 20% down except for FHA.
1 point is 1% of the loan.
Programs quoted as having 1 point also have the option of 0 points and the option of the 0 cost loan.
Jumbo loans are loans that have a loan amount of $625,501 and above on conventional programs.
Conventional is also known as Fannie Mae and Freddie Mac financing.
If you have any questions or comments, please contact me at firstname.lastname@example.org. or call 310-218-6855.