Mortgage Financing is Definitely Available!

Houston is known for its hot weather, but days like today make it all worthwhile! No wonder our New Year season is always labeled as the kick start to the home buying season. Is it the crisp weather, or the sense of starting with a ‘clean slate’ that motivates buyers to put off buying until the Spring each year? Whatever the reason, this year I have surely seen an increase in buyers. And financing is definitely available! Take for example, the fact that I am in the office on a Saturday, and was last Saturday. In fact, after I wrote my newsletter to you last week (on Saturday!), I received 4 new referrals, all purchases, and had to come in Sunday. My husband has just resolved to the fact dishes and laundry are now on his honey do list! If your prospective buyer roster has not filled up yet, my prediction is that it will, and fast. So enjoy the silence. Use your time wisely to get recharged and organized.

What about these rates? With the Fed announcing this last week their plans to buy mortgage backed securities, a partial approval of the stimulus plan for the economy, and the news that national home sales ROSE 9% in December, you would think the rates would have gone down. Well, except these are different times. Unchartered territory. The stock market is manic (really). Nothing seems to make sense or follow basic economic principles anymore. After this weeks’ news, the bond market (where mortgages most closely relate) did not fare well, as yields , or rates, of bonds lowered because (1) the bailout plan shows flaws, and had not Republican support (2) The FED did not announce ‘specific’ plans for purchasing securities and ( c) 100,000 layoffs that were announced. So you see, the news is never good enough! Never specific enough!

Despite what you may hear, the government cannot directly control the rates . They can purchase the mortgage backed securities in an attempt to push the rates down, but what if that doesn’t work? What if ‘other’ pressures on the bond market cause their plan backfire? It could very well happen, and some critics of this strategy are anticipating it. So my point here is that borrowers (whether purchasing or refinancing) need to take what they can get NOW. Enjoy these low rates now. Waiting on the sidelines for 4.5% or lower, may be about as reasonable as me hoping to win the lottery tonight – when I didn’t even buy a ticket.