Colorado Home Mortgage Banking

Colorado Mortgage rates are taking a pounding in the market today.  We have been concerned about the inflationary numbers for some time.  CPI (Consumer Price Index) and Core CPI both came in a lot higher then what the consensus had anticipated.  This increased data on inflation has sent Colorado Mortgage Rates back on an uphill climb.  I am expecting to see Colorado Mortgage Rates to increase about .125% to .25% by close of business today.  That will put the LOCK rate at 6.25%.  CPI is used to gauge changes in inflation and Colorado Mortgage markets tend to be extremely sensitive to unexpected changes to the reported numbers. As inflation and expectations of future inflation rates change, Colorado Mortgage markets adjust interest rates to reflect those changes.  Investors require higher returns on fixed rate bonds in order to justify the risk of holding them long term.  This is why inflation impact Colorado Mortgage bonds negatively.

In tough economic down turns, there are several reasons why inflation will work its way into the system.  Businesses increase prices in order to off set volume issues. Oil prices have hit historically high trading levels, making shipping of goods more expensive.  The level of competition begins to deteriorate as competitors exit the market because they lack the resources to stay in business.  This creates temporary demand for limited resources, which normally yields higher prices.  Colorado Mortgage Rates do not respond well to these pressures and the increases in Colorado Mortgage Rates are inevitable.  So the question I present today is how high will Colorado Mortgage Rates go in the short term (about 2-5 days), Mid-term (8-21days), and long-term (30-60 days).   

The Short term picture is easy to predict for Today.  We will not have a good day for Colorado Mortgage Rates as investors react extremely negatively to poor inflationary news.  The reaction will be exaggerated and some of the losses will be made up during the week.  This being said I expect a .125% Colorado Mortgage Rate increase by the end of the week.  So you are not going to be penalized to bad for not LOCKING in last week, but it will be a bit higher for your Colorado Mortgage closing this week.

The Mid-term picture is the toughest Colorado Mortgage rate trend to predict.  It is heavily impacted by headlines and economic data and does not follow any conventional cyclical terms seen in the Colorado Mortgage Market through out the year.  I still believe that we are over priced in Colorado Mortgage Rates due to investor’s fears of the current financial markets.  This being said inflation will continue to be a heavily watched indicator and it will take a lot of headlines to impact Colorado Mortgage rates enough to come down.  The Headlines we are looking for will be corporate profit issues.  This will be a major topic over the course of the year and will be the biggest influencer combating inflationary caused Colorado Mortgage rate increases.  I don’t see anything this year to indicate that profits will show the gains necessary to increase Colorado Mortgage Rates.  In fact most of profits reported so far have been positive for Colorado Mortgage Rates.  I believe that we will have periods over the next 3 weeks that will allow us to lock between 5.875% and 6.00%.  When this happens I will implement immediate Colorado Mortgage rate lock recommendations. 

The Long-Term picture is a little easier to predict as Colorado Mortgage Rates tend to show cyclical phenomenon’s.  Colorado Mortgage Rates typically peak for the year during summer months when demand is high.  The opposite is true during the winter months.  I expect to see Colorado Mortgage Rates to eventually hit the 5.75% range before the year is done and 5,.875% in the next 60 days. You can easily see that the range for Colorado Mortgage interest rates for the next 60 days will be between 5.875% and 6.375%, about a .5% movement.  The real impact on interest rates will be minimal, and will trend upward for the most part.  It will be important to keep watch so that you can LOCK you loan at the right time.  This is why having a good Colorado Mortgage provider is so important. 

Let me show you the cost savings by going with the right Colorado Mortgage provider.  Let’s say that you are unaware of the market and lock your loan at the worst possible time costing you .5% more on your Colorado Mortgage rate.  If you borrow $200,000 you will be paying about $1000 more a year.  The cost of interest will decrease over time but you can expect that you’re over all cost for locking at the wrong time will be around $22,000 on a 30 year Colorado Mortgage.  I think that this is significant enough to make sure you are working with the right people.

I would love a chance to earn your business and the business of anyone you might know in need of a Colorado Mortgage Loan.  I will have an article about FHA Loans and the Power that they have on the market today.  FHA Colorado Mortgage programs have been bailing the financial markets out of trouble for years.  It is very evident that they are doing it again.  Check that article out at www.colordaohomemortgageloan.net/news

Have a great day, Daniel

Colorado Home Loan Rates took a hard hit on Friday.  If you had a chance to lock your loan on Wednesday or Thursday you would have done well for yourself.  Colorado Home Loan Rates had been dropping for most of the week and if you haven’t heard yet the market took some hard hits on Friday.  Colorado Home Loan Rates jumped up about .375% to .5% in a single day washing away much of the Colorado Home Loan Rate gains experienced earlier in the week.  The reason for such a drastic increase in Colorado Home Loan Rates came from two different banking institutions.  Freddie Mac and Fannie Mae are the biggest Home Loan providers in the country.  They were established by the government to warehouse mortgage loans that are bought and sold on the Mortgage Backed Securities market.  Both of these wholesale lending institutions have come under fire recently as more and more mortgages have gone into default.  Investors became very concerned that the MBS market would also come under fire as a result of the instability facing these companies.  Colorado Home Loan rates responded accordingly late Friday by increasing their Rates.

The increase in Colorado Home Loan rates may have been a bit exaggerated on Friday and so far the market is re-adjusting itself.  The re-adjusting should fair pretty good for Colorado Home Loan rates, so we are implementing a FLOAT recommendation until about 4:00pm Mountain Standard time.  It will be important to check in with me during the next 4 hours if you are looking to lock today.  Eventually fears for what PPI will indicate tomorrow will work its way into the Colorado Home Loan rate market.  When this happens the gains we are seeing so far will start to go away.  We will want to LOCK at the right time, which should be sometime this afternoon.  The reason for the double recommendation today is that we still have some concerns about the inflationary reports due to come out on Tuesday and Wednesday.  CPI and PPI are the biggest movers of Colorado Home Loan rates stemming from economic data.

Economists pay the most attention to the PPI’s for finished goods, intermediate goods and crude goods. The PPI’s measure inflation of prices on the producers’ end and often that inflation gets passed onto the consumer and CPI. Inflationary pressures seen in PPI can help predict future pressures on consumer products’ prices.  When inflation runs high the value of a fixed rate bond decreases.  The decrease in value requires a higher interest rate premium to sell the bond.  Future bonds will also require higher interest rate premiums to attract new demand, and as a result Colorado Home Loan Rates increases to accommodate this demand.  CPI is used to gauge changes in Consumer paid inflation and Colorado Home Loan markets tend to be extremely sensitive to unexpected changes to the reported numbers. As inflation and expectations of future inflation rates change, the markets adjust Colorado Home Loan interest rates to reflect those changes. The effect of these changes is seen across all markets, equities, bonds and mortgage backed securities.

The final piece of information to be aware of is the failure of Indy Mac the 3^rd largest banking institution to fail in U.S. history.  The financial crisis is still in full force and Colorado Home Loan lenders are very aware of these issues.  Lenders are tightening up on their qualifying measures and though Colorado Home Loan Rates appear to be low, qualifying for that Colorado Home Loan programs has never been tougher.  Most realtors and mortgage providers that have been in the business for some time have found it difficult to understand the magnitude of these changes.  If you are in this category please let me know and I will be happy to answer your Colorado Home Loan questions.  Getting back to Indy Mac, late last week they experienced the same run on the bank that several Savings and Loans institutions felt in the 1980’s as the market collapsed on similar economic pressures seen today.  The Federal Reserve has jumped in again to reaffirm that federal depository insurance will cover losses from this bank.  The scary thing on this is that they will only cover $100,000 for each depositor.  People will loose money from this collapse. The full impacts of the mortgage crisis will not be felt until sometime next summer.  So it is more important then ever to work with people who understand the market and who actively participate in the market in order for you to get the best Colorado Home Loan available.

Please give me a call and allow me a chance to earn your Colorado Home Loan business. I have also written an article today that answers the question facing many Americans “What should I do when my Colorado Home Loan Rates is set to adjust.”  You can view that article at www.coloradohomeloanmortgage.net/news

Have a Great dayJ Daniel

Colorado Online Mortgage Rates may have hit its bottom end for the week.  I have had a Colorado Online Mortgage lock recommendation in place all week and no matter when you locked this week your Colorado Online Mortgage rate should have been pretty good.  We have had a lock recommendation at 6.0% and that is exactly where we have been locking in our clients. 

A variety of economic reports come out today, but none of these reports are real market movers.  Consumer Sentiment, which came out today, is used to gain insight into possible future consumer spending. It is almost identical to consumer confidence but it has two readings per month, preliminary and final readings. The consumer expectations portion is used for the leading economic indicators index.  The data pulled from this report gives investors a good indication on consumer spending behavior.  Colorado Online Mortgage rates tend to do a little better when spending predictions are down.  Likewise Colorado Online Mortgage rates tend to go up when Consumer confidence is high.  The reason Colorado Online Mortgage rates are affected is that investors believe that if spending is high, Corporate profits should also be high.  When profits are high investors tend to invest more in equities (stocks), which decreases the money available for bonds.  The movement seen in Colorado Online Mortgage Rates greatly depends on how high or how low the demands for bonds are.  Today’s report came in near historic low levels, but not as low as expected.  Colorado Online Mortgage rates should have reacted negatively, but so far it appears that the bond market is holding its own.

Another Economic Report released today was the current Trade Balance figures.  This report does not impact Colorado Online Mortgage rates severely but investors do look at this report for potential investment decisions.  The volatility in the monthly trade balance can play an important role in forecasts of GDP. Net exports are a relatively volatile component of GDP, and the trade report provides early clues to the net export performance each quarter. There are many complex links between the Trade Balance and MBS markets, and some work in opposite directions, so the net effect is difficult to predict.  Because of these inverse relationships it becomes a good report to monitor.  I monitor this report to help predict future Colorado Online Mortgage Rate movement.  However over the last year or so I have not seen any major movement, and normally headlines take center stage over this report as it relates to Colorado Online Mortgage Rates.  The Trade Balance did not come in as poorly as expected so we should have seen a little bit of negative movement in the market for Colorado Online Mortgage Rates.

The Final piece of data comes from the Headlines as the Stock Market appears to be plummeting into its worse closing in 3 years.  Investors see this as a very negative sign and they tend to reinvest in safer investments like bonds.  Colorado Online Mortgage rates will have very positive reactions to this, and did so this morning.  However, over the last couple of hours we have seen a drastic negative movement in the bond market as well.  I am not seeing exactly why yet with the data sources I have, but can only assume that we are seeing major news leaking into the Market that has investors scared to invest.  Colorado Online Mortgage rates will come up a bit if this trend continues through today.  Fannie Mae and Freddie Mac are the biggest two mortgage companies in the U.S. and account for about 50% of the total mortgage business.  Over the last 24 hours major fears have hit the stock market that these companies may have to file for Bankruptcy protection.  This is probably the biggest influencer in the Colorado Online Mortgage market, and has been the reason for the drastic 500 point drop in stocks over the last 24 hours.  The Federal Reserve came out late yesterday to state that they would intervene and will not allow these companies to fold.  This is good news for investors, but because of the magnitude of influence these companies will have on the financial markets it is clear why so many investors are running scared.  This should be a really good thing for Colorado Online Mortgage rates, but since it deals with companies tied to bonds it is playing havoc on both markets. 

I still believe that Locking your rate today will be the best Colorado Online Mortgage decision you make.  If you LOCKED a few days ago and lost out on the 1/8^th of a point you might have saved on your Colorado Online Mortgage Rate, don’t be alarmed you still got in at the right time.  The writing is on the wall and locking would be a good idea.  Please check out my other site www.coloradohomemortgageloan.net/news for information about how Colorado Online Mortgage rates are established.  Until then have a great weekend and give us a chance to earn your businessJ

Daniel

Colorado Home Loan Rates appear to be moving in the right direction today.  Pending home sales came in lower then expected which created some excitement in the Mortgage Backed Securities market.  So far we have seen some improvements in Colorado Home Loan Rates, but not enough to indicate a price improvement.  The good news is that Colorado Home Loan Rates will probably not have any increases on today’s headlines.  We implemented a LOCK recommendation yesterday, and we will maintain the LOCK recommendation today. 

This week will be a light week for economic data and it will not take much to send Colorado Home Loan Rates back up.  Investors are anticipating more bad news circling around unemployment, which means Thursdays Jobless Claims, should have some impacts on Colorado Home Loan Rates later this week.  Tomorrow we have no scheduled economic data to be released.  The Lack of data will force investors to monitor the equities market before making their buy/sell decisions for MBS. 

Ben Bernanke spoke in Virginia yesterday and he continued his tough talk about additional regulation in the mortgage lending markets.  His comments indicated that the shady practices used by lenders over the last few years, has been the biggest influencer in our current economic downturn.  He is proposing additional regulations on mortgage lenders to help improve the current performance of Mortgage Backed Securities.  Ben will present his recommendations to a senate sub-committee for review sometime next week.  Investors have not reacted negatively to the news and so far we have not seen any major impacts in the Colorado Home Loan markets.  Reform is needed and lenders do need additional regulation, but to what extent still needs to be debated. 

Colorado Home Loan Rates have always been impacted by risk.  Underwriters are the banks authority when assessing risk.  They are in charge of assessing what the risk is and whether the risk on the file should be considered for approval.  Colorado Home Loan Rates are influenced by the entire mortgage portfolio and the history of that mortgage portfolio.  In the past underwriters approved just about any Colorado Home Loan, which has drastically deteriorated the current performance of these mortgage portfolios. The result of loose lending practices has created a higher then normal risk premium being added to Colorado Home Loan Rates today.  Today underwriters are taking a tougher approach in approving Colorado Home Loan programs, which should return better performing portfolio’s in the future.  The risk on today’s loans is considerably lower then the risk premium being added to Colorado Home Loan Rates.  We are still paying for mistakes made over the last few years, and will not see the risk premium reduced for some time.  If the Federal Reserve implements additional restrictions and Colorado Home Loan Rates don’t improve, Lenders will ultimately reap the benefits in higher profit margins.  This is ok but eventually the savings should be passed back in the form of lower Colorado Home Loan Rates.

I am hoping that Lenders recognize the spread between Risk and current Colorado Home Loan Rates, but so far it appears that the spread is still fairly large.  In short you are paying more now because of the losses created by poor lending decisions 2 or 3 years ago.  We will not see any significant changes in the risk premiums added to Colorado Home Loan Rates until the portfolios perform better over time.  With all the restrictions currently put into place, we should see Colorado Home Loan Rates improve its risk premium over the next 12 to 18 months. 

Though the portfolio will improve its performance, it should be noted, that we have many other factors influencing the direction Colorado Home Loan Rates will go.  The biggest factor affecting Colorado Home Loan Rates is inflation.  This topic has been discussed in great detail here, but I want to remind you that it will be the biggest driver of Colorado Home Loan Rates over the next 6 months.  I have some real concerns about how much of an impact inflation will have and we have already begun to seen the impacts over the last 2 months.  The impacts have not come from actual inflationary reports, but from speculation of what is to come.  The real affect will be felt when economic reports begin to report the higher inflationary numbers.  Colorado Home Loan Rates are certainly expected to go up from its current levels.  We see some pockets of hope where Colorado Home Loan Rates drop or show some stability and that is the best time to LOCK.  We are experiencing that in the market right now, and should for the remainder of the week.  Next week on Tuesday and Wednesday, we will have our inflationary report numbers.   So if you can get into a good Colorado Home Loan Rate today, then LOCKING is a good idea.

Over the Last couple of months our inflationary numbers have been in line.  Most of that is not due to lower prices, but to lower spending.  Eventually people will spend again and prices at its current levels will create higher then expected inflationary pressure.  When this happens inflationary reports will come out high, which inevitably creates havoc on the Mortgage Backed Securities Market.  Colorado Home Loan Rates hate anything to do with inflation and rates will go up.   Next week if PPI or CPI comes in worse the expected, Colorado Home Loan Rates will climb.  Stay tuned to this site daily as updates are made on a regular basis. 

For your Colorado Home Loan decision it’s easy to find someone to help you, however it can be difficult to find someone who knows what they are talking about.  Please allow me a chance to work with your Colorado Home Loan; I have the knowledge to get you the best Colorado Home Loan available.  I have also written an interesting article about Brokers or Bankers at www.coloradohomemortgageloan.net/news let me know what you think.

Daniel     

Colorado Home Mortgage rates appear to be off to a rough start this morning.  The Mortgage Backed Securities market has lost some ground over the weekend and Colorado Home Mortgage rates are expected to be a bit higher today.  We implemented a lock recommendation last week and for those that locked your Colorado Home Mortgage rate it now appears that you made the right choice.  The market will be light this week which means the headlines will dictate the direction demanded on Colorado Home Mortgage rates.  Tomorrow we expect pending home sale figures to be reported and so far the consensus has indicated another decrease in home sales for the 2Q for 2008.  This is a drastic decreased expectation from what was reported last month.  If the report comes in better then expected Colorado Home Mortgage rates will jump up a bit.  Because there is such a huge difference in the Consensus and what was reported last I believe that the report will beat expectation.  So we will continue to hold up on our Lock recommendation.  Some Lenders may have put to much cushion on the Colorado Home Mortgage rate sheets in anticipation of a bad week.  Luckily we have access to all the lenders and we will ensure you do not get high with that Colorado Home Mortgage rate premium. 

The Pending Home Sales index measures housing contract activity. It is based on signed real estate contracts for existing single-family homes, condos and co-ops. A signed contract is not counted as a sale until the transaction closes. Modeling for the new index looks at the monthly relationship between existing-home sale contracts and transaction closings over the last four years.  This is important for Colorado Home Mortgage rates because It is designed to be a leading indicator of housing activity. Greater housing sector activity indicates a stronger economy, which is generally negative for Colorado Home Mortgage markets.  We are expecting a -3% increase versus a 6.3% increase reported last time the report came out.  Because of the 10% gap from one month to the other and the fact that we are still in our selling season, I believe the report is a bit to pessimistic.  This will result in an increase of Colorado Home Mortgage rates by late afternoon tomorrow, if investors have not already priced that in today.   The only other reports to look for this week will be the trade deficit report and the consumer sentiment.  Both reports are expected to come in poorly. 

It is interesting that with the dismal outlook being portrayed in the market that Colorado Home Mortgage rates appear to be higher then they should.  I have talked about the economic conditions many times in previous blogs, but we need to remember that this is not new territory for the Colorado Home Mortgage market.  We have seen this before.  We are experiencing many pressures in the inflation category due to the oil price shock, and we are experiencing a bad economic turnaround.  Both these indicators took place in the late 1970’s and early 1980’s.  What makes this go around so much better is that our Federal Reserve members are better prepared to handle the economic stimulus needed to get us back on track.  If we did not have the current pressure from oil causing un-needed inflation fears in the market, we would probably see Colorado Home Mortgage rates in the low 5% range on the 30 year fixed.   However inflation is devaluing the bonds and investors are demanding a higher return to buy them.  This is the biggest reason we see Colorado Home Mortgage rates higher then they need to be. 

We can’t blame ourselves for the higher oil prices; it is simply demand that has caused oil to increase to its highest levels ever.  The demand for oil is not even a domestic issue it is a global issue.  We are experiencing inflationary pressures that are out of our control.  The pressure is a direct result of global demand not domestic demand.  So the only way we can combat the issues is to understand where the pressures are coming from. The U.S is no longer the market movers in the global market place.  Because we are not the market movers we need to work on understanding and forecasting based on the pressures experienced in global activities versus domestic activities.  Colorado Home Mortgage rates will probably not see the low 5% range for some time to come.  Instead we need to prepare ourselves for the up and down cycles that will result from the continued global demand.  Like the U.S. other countries like China will slow down demand as prices go up.  We need to identify the cycles demanded in the global market to understand what the pricing cycles that makes its way into the domestic bond markets.  Once that is identified, we can then begin to accurately predict Colorado Home Mortgage rate trends.  In the meantime I will continue to monitor both the domestic and global influencers that affect our bonds markets before making any real Lock/Float recommendation. 

Please contact me with your Colorado Home Mortgage questions.  I have also included a piece on foreclosures that you can read at www.coloradomortgagebanking.com/news.

Daniel