Colorado Home Mortgage Banking

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 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 Loan rates will be improving a bit today as the stock market takes yet another hit for the day.  We have seen the equities market take about a 15% decrease in the last couple of weeks which would normally be great for Colorado Home Loan rates.  I stated a couple of days ago that we had a number of economic reports coming out which should impact Colorado Home Loan rates.  Consumer Sentiment, Core PCE, and Personal income reports all came out today.  I will discuss those reports and yesterdays reports at www.coloradohomemortgageloan.net/news right now just know that the economic data today was for the most part positive news for Mortgage Backed Securities.  When the price of Bonds goes up Colorado Home Loan rates tend to dropJ 

So the battle rages on with investors on which direction our economy is headed.  Investors are faced with a very difficult decision in their investment strategies.  If the Economy continues to spiral downward then equities will be a poor choice.  We are seeing that in the stock market right now.  Colorado Home Loan rates should have had huge improvements while the stock market dropped.  The improvements we should have seen were halted by the continued threat of inflation.  Inflation is the second obstacle facing investors today.  If investors invest in long-term fixed rate bonds, and inflation gets out of control, investors will loose value in their portfolios.  So the question is what should investors do.  If in fact investors choose fixed rate investments over equities, Colorado Home Loan rates will improve. 

In the short run it certainly appears that poor economic conditions remain a bigger concern then inflation.  The Federal Reserve continues to push its actions toward improving economic conditions, while talking about inflationary pressures.  This tactic is used to stimulate the economic activity, while trying to hold off inflationary pressures.  We are still facing some major obstacles in the next 18 months and will not be able to really account for the aftermath until a recovery in our financial system begins.  We can see the impacts of inconsistency in Colorado Home Loan rates already.  Based on our current Economic condition there is no reason why the 30 year fixed Colorado Home Loan rate should be any higher then 5.0% flat.  This is a huge difference from where we are at now.  We are pushing the envelop on anything below 6.25% for any Colorado Home Loan program.  Even though we are above the 6.00% range we believe that some relief is in store.

Colorado Home Loan rates should continue to see relief despite the current inflationary pressures seen in Oil.  Colorado Home Loan rates will improve, because the economic issues are out weighing the cost increases that contribute to inflation.  Though Colorado Home Loan rates will improve, they will not improve as much as they should.  $142 a barrel of oil, COME ON!!! Can anyone who promised to protect the American people from foreign threats not see that this is a threat to our financial system?  Of course not, we have a bunch of talkers in the senate that would rather debate each other to death versus actually doing something.  At least when the Republican Party had control of congress things got done, mind you it was not always the right decision, but at least something happened.  We have now experienced a two year downward turn since the democratic lead Senate took over and so far NOTHING has happened.  I guess as most of you can see I am a Republican, but I am also honest enough to know that there is good to both parties, regardless of your political affiliation you have, something needs to be done.  Colorado Home Loan rates will continue to be in a state of confusion until we fix some of the variables impacting our markets from abroad.  Colorado Home Loan rates like any other interest rate instrument would stimulate our economy back if in fact rates were low enough.  Inflation already has several momentum building influences when money supply becomes less expensive.  When we add the unsustainable cost increases of oil to our inflationary numbers, it becomes very difficult to combat economic issues.  The tools used by the Federal Reserve to help stimulate the economy are limited by the constant treat of inflation.  When inflation presents itself without Federal Reserve intervention we are limiting what can be done to help stimulate our Economy.  Oil needs to be address and it needs to be addressed now, otherwise we will be in this economic rut longer then we need to be.

Sorry about that tangent.  I do want to quickly express my appreciation for Ben Bernanke I have criticized him a bit in the past, but I believe he is doing all he can to help our economic systems.  He is faced with many difficult obstacles never seen in our economy before and so far he has done everything he can to ensure that our situation does not get any worse.  Regardless of what you think about President Bush, his economic stimulus package that gave Americans additional funds late April and May showed that at least he is willing to do something.  I am maintaining a FLOAT recommendation today and so far the MBS markets appear to be favoring Colorado Home Loan rates.  We have not seen any substantial decreases over the last few days, but we do not foresee any major reports that will drive Colorado Home Loan rates up.  Every time I watch Lender activity it appears that they are moving Colorado Home Loan rates up quickly and bringing them down slowly.  Right now we are seeing the momentum for Colorado Home Loan rates coming downward. 

Please give me a call about your Colorado Home Loan rates, and hopefully I did not offend anyone.  I really enjoy everyone’s perspective and can sometimes be opinionated.

God Bless and have a great weekend.

Daniel