DIRECT MORTGAGE
(800) 309-0585

DIRECT MORTGAGE
(800) 309-0585

Thursday, August 13, 2020
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Market Commentary

Updated on August 13, 2020 10:39:36 AM EDT

This morning’s only relevant economic data was last week’s unemployment figures that showed 963,000 new claims for benefits were filed. This was lower than expected, a decline from the previous week and broke a streak of 20 consecutive weeks of over 1 million new filings. While the decline indicates the employment sector improved slightly last week, the high number also means the sector is still struggling. However, since the number was below forecasts we need to consider the data bad news for mortgage rates.

Yesterday’s 10-year Treasury Note auction went relatively well with the benchmarks showing a slightly above average level of interest in the securities. The bond market did react favorably to the results when they were posted but did not create enough of a move to improve rates. A strong demand in today’s 30-year Bond auction could help boost bond prices and slightly lower mortgage rates after results are posted at 1:00 PM ET.

Before we get into tomorrow’s economic releases, it is worth noting an important announcement last night from the Federal Housing Finance Agency (FHFA). The FHFA supervises Fannie Mae and Freddie Mac, who are the entities that buy a significant number of residential home loans from mortgage lenders to keep the mortgage market liquid. The unexpected announcement was a new fee of .5% of the loan amount added to all refinances sold to either entity after September 1 of this year. While this is technically charged to the originating lender that sells the loan, it will undoubtedly be passed on to the borrower in their pricing. This fee will apply only to refinances (not purchase transactions) that qualify under conforming loan limits. The announcement creates a huge incentive to close and fund any pending refinance loans this month to avoid the fee.

Tomorrow brings us four economic reports for the markets to digest, one of which is considered to be highly important. That would be Julys Retail Sales data from the Commerce Department at 8:30 AM ET. It will give us a measurement of consumer spending, which is extremely relevant to the markets because it makes up over two-thirds of the U.S. economy. Current forecasts are calling for a 1.9% increase in sales. Analysts are also calling for a 1.5% rise in sales if more volatile and costly auto transactions are excluded. Larger than expected increases would be considered bad news for bonds and likely lead to an increase in mortgage pricing since it would indicate stronger economic growth. Ideally, we will see smaller increases that should lead to lower rates.

Employee Productivity and Costs data for the second quarter will also be released early tomorrow morning. It helps us track employee output per hour worked. High levels of productivity are believed to allow the economy to grow without fears of inflation. I dont see this being a big mover of mortgage rates, especially coming on a day with three other releases that include a major report. A sizable increase in productivity and a smaller than expected rise in labor costs would be favorable news for bonds.

The third release of the day will be Julys Industrial Production report at 9:15 AM ET that measures manufacturing sector strength by tracking output at U.S. factories, mines and utilities. It is expected to show a 3.0% increase from Junes level. A smaller rise would be considered good news for mortgage rates because it would show manufacturing activity was softer than thought and broader economic growth will be more difficult.

Finally, the University of Michigan will post their Index of Consumer Sentiment for August at 10:00 AM ET. This report will give us an indication of consumer confidence, which projects consumer willingness to spend. If a consumers confidence in their own financial and employment situation is rising, they are more apt to make large purchases in the near future. But, if they are growing more concerned about their job security or finances, they probably will delay making that large purchase. This influences future consumer spending data and therefore, impacts the financial markets. It is expected to show a decline from July’s 72.5, meaning confidence was softer this month than last and that surveyed consumers are less likely to make a large purchase. Good news for mortgage rates would be a sizable decline.

 ©Mortgage Commentary 2020

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CPU Refinancing Playa Vista

Hi all,

I have been asked over the past 2 years about mortgage refinancing on a CPU in Playa Vista.  I was introduced to CPU condo's in Playa Vista in 2017. 

The refinancing of Controlled Price Units on condo's can be complex.  I have navigated the waters with over 2 dozen successful CPU refinances on condo's in Playa Vista.

I have been able to use the current market value, not the resale value, to help owners eliminate mortgage insurance.

Here are some yelp reviews:  (google: CPU Refinance Yelp)

"I just completed a refinance with Dave after he was recommended by several neighbors. Purchased a condo in 2017 and had to initially go with the lender that was recommended by the builder. I was paying PMI, which would be required for a few more years.

Dave was able to help me with a refinance and the process only took 2 weeks. He got rid of the PMI. As a result, monthly payment has decreased
saving me thousands in the long run."

Dave LaRose helped us to refinance our mortgage in Playa Vista this year. He got us out of PMI and lowered our monthly payments by over $500. He has taken the time to really know the ins and outs of the mortgage business and even complicated rules and regulations of CPU purchases. Highly recommend him and his team!

I don't even know where to start with reviewing Dave. He is an incredibly kind and intelligent man and did a wonderful job helping us refinance our mortgage on a CPU! From the first phone call, Dave was very informative and made sure both my husband and I understood every step. He sends over a quick text right before every docusign and is available for questions 24/7. He had us locked in at a better rate than we already had and with some changes in the market and a little time to spare before closing, he got us an even LOWER rate! We did not even have to ask him to do this. He genuinely wants his clients to get the best deal possible and works tirelessly to make sure that happens. We have already recommended him to several of our neighbors and will continue to do so. He made the refinance process stress-free and dare I say it... EASY! From now on, Dave is our one and only broker for all of our mortgage needs!

 

If you are looking to refinance your CPU, please reach out.

Dave LaRose

Direct Mortgage Source, Inc.

800-309-0585 ext. 101


 

CA-BRE # 01357986 NMLS #238291
16955 Via Del Campo #110 | San Diego, CA 92127
(800) 309-0585  Ext. 101 | (858) 487-7179  Ext. 11   | Fax: (800) 834-0799 

This material is not from HUD or FHA and has not been approved by HUD or a government agency.

 

CPU Refinancing Playa Vista

Hi all,

I have been asked over the past 2 years about mortgage refinancing on a CPU in Playa Vista.  I was introduced to CPU condo's in Playa Vista in 2017. 

The refinancing of Controlled Price Units on condo's can be complex.  I have navigated the waters with over 2 dozen successful CPU refinances on condo's in Playa Vista.

I have been able to use the current market value, not the resale value, to help owners eliminate mortgage insurance.

Here are some yelp reviews:  (google: CPU Refinance Yelp)

"I just completed a refinance with Dave after he was recommended by several neighbors. Purchased a condo in 2017 and had to initially go with the lender that was recommended by the builder. I was paying PMI, which would be required for a few more years.

Dave was able to help me with a refinance and the process only took 2 weeks. He got rid of the PMI. As a result, monthly payment has decreased
saving me thousands in the long run."

Dave LaRose helped us to refinance our mortgage in Playa Vista this year. He got us out of PMI and lowered our monthly payments by over $500. He has taken the time to really know the ins and outs of the mortgage business and even complicated rules and regulations of CPU purchases. Highly recommend him and his team!

I don't even know where to start with reviewing Dave. He is an incredibly kind and intelligent man and did a wonderful job helping us refinance our mortgage on a CPU! From the first phone call, Dave was very informative and made sure both my husband and I understood every step. He sends over a quick text right before every docusign and is available for questions 24/7. He had us locked in at a better rate than we already had and with some changes in the market and a little time to spare before closing, he got us an even LOWER rate! We did not even have to ask him to do this. He genuinely wants his clients to get the best deal possible and works tirelessly to make sure that happens. We have already recommended him to several of our neighbors and will continue to do so. He made the refinance process stress-free and dare I say it... EASY! From now on, Dave is our one and only broker for all of our mortgage needs!

 

If you are looking to refinance your CPU, please reach out.

Dave LaRose

Direct Mortgage Source, Inc.

800-309-0585 ext. 101


 

CA-BRE # 01357986 NMLS #238291
16955 Via Del Campo #110 | San Diego, CA 92127
(800) 309-0585  Ext. 101 | (858) 487-7179  Ext. 11   | Fax: (800) 834-0799 

This material is not from HUD or FHA and has not been approved by HUD or a government agency.